The concept of what is going to change in the real estate industry is always a challenge Understanding the change itself isn’t necessarily the difficult part — but how to adapt to that change is tough.
As an example, in trying to anticipate how the industry will change in the industrial asset class, Hamid Moghadam pointed out that industrial—or more specifically the distribution facility—“is where people store their mistakes. In other words, in a perfect market the supply and demand of product would not have this inventory and there would be no need for distribution buildings to store inventory. The users of this product need short term flexibility in terms of space and lease term. Owners of the facilities need and want long term commitments to space. The property owners who can figure out how to meet this ever changing demand of the user will have adapted well. To make this change is difficult.