Investing in the Heartland: The Case for More Exposure to Mid-America’s Commercial Real Estate
Westrock Coffee Company - Conway, AR
The heartland of America is swiftly emerging as an investment hotspot that cannot be overlooked. This region, which was once underestimated by investors, is currently experiencing a boom in interest due to the population distribution triggered by the pandemic. This movement has brought global influencers from their coastal habitats to ignite new centers of innovation across the bountiful landscape. But, how does this lifestyle and innovation trend convert into a viable investment strategy for commercial real estate? In this discourse, we delve into the reasons that make mid-America a highly attractive proposition for commercial real estate investors today.
Decoding the Heartland Phenomenon
The past decade has brought about a significant shift within the investment playing field. Over the past decade, what began as a small trend has evolved into a significant movement, with an increasing number of individuals flocking to America’s heartland, drawn by a future as promising as its rich history. This movement was fittingly referred to as the 'Rise of the Rest' by tech pioneer Steve Case, the driving force behind AOL. He advocated the concept that succeeding waves of technological advancement wouldn't be confined to frequent tech centers like Silicon Valley or New York City, but would instead be disseminated across the nation, with an emphasis on the heartland. Much akin to his prescient views on the internet's potential back in the 1980s, his forecast for the heartland, bold as it might be, could potentially be an understatement.
The Allure of Investing in Middle America’s Real Estate
Commercial real estate in the heart of America has surfaced as an appealing investment prospect. It's common knowledge among property investors that flourishing economies fuel the growth of property values. Those who are convinced that the rise of the rest portends a multi-year shift in the epicenter of economic growth, see commercial real estate as an excellent means to leverage these trends.
This shift towards the American heartland has been in motion for approximately a decade, causing some who aspire to seize this opportunity to question if the chance to profit from this transition has already elapsed. However, the pace of commercial real estate is considerably slower than that of individuals or even corporations. While individuals may determine within weeks or months to relocate, and corporations may take a year or two, real estate generally takes a couple of years to react to this expansion and several more to truly meet the demand. This lag can be exasperating for those eager to instigate change but it offers a significant opportunity for those who identify a well-established trend with plenty of remaining room to run.
Stay tuned for Part 2 of our expoloration into the trasnformative opportunities in the heartland of America. In the next post, we will dive into uncovering the value of mid-America’s commercial real estate.
Dan Andrews
CEO