Is Pop Real Estate A Thing?
I don’t think the term is acceptable in the real estate industry yet, but I know it’s important for you to be aware of the concept. People are lacing their wallets, purses, and financial portfolios with cash flow from real estate daily. The technical jargon they use may sound foreign, but at the end of the day real estate is about popularity and profitability. Real estate is that hot girl or guy that everyone one wants a piece of. Yes, real estate can be shallow, but the goal is for you become aware of the lucrative game happening around you, so that in time you can play the game too. Below are a few of the characteristics that help me identify popular real estate.
Sexy: Beyonce is one of the most popular superstars of our generation and obviously very sexy. The architecture firm, Elenberg Fraser, has designed a building that will mimic her umm…. womanly curves that she displayed in her music video for “Ghost”. Unique architecture and design can set a building apart from the competition. Just as every person is unique in their own way each building can have its own unique features and variations. A sexy design will stand out from the rest, and you can be sure that buyers, investors and potential tenants take notice, especially if it’s shaped like Queen Bey.
Charisma: Looks can only get you so far but a good story and personality is like finding someone with brains and beauty. What’s the hype around exposed brick, intricate mosaic tile floors, or the original cornerstone dated 1863? Through detailed craftsmanship they can tell a story of history, love, and sometimes scandal. The beauty of the architecture supported by the stories it tells makes it one of a kind, and there is value in owning something that can’t be replaced or easily duplicated.
It’s tough to gauge how much a good story affects the value of a property, but one of the most important things it does is evoke emotion. Buying and selling can sometimes be and emotional process. If a building can produce a profit a good story can close the deal. A great example of this is Urban Outfitters’ decision to locate their headquarters in a restored navy yard in Philadelphia, Pennsylvania.
Q: Where do you live?
A: Beverly Hills
Q: Where do you shop?
Q: Where’s your new studio?
A: Miami Design District
Get my point? Location is usually your first point of reference when analyzing real estate, and it can add or drop the value instantly. For instance, a live-work studio in Jackson, Mississippi will not sell for the same price as a live-work studio in San Francisco, California. On the other hand, the very same live-work space in the heart San Francisco will likely be worth less if it is located in a less desirable area outside the city limits. The point is that every building has a value, but in real estate value is relative to location, location, location!
“You can’t sit with us!”: The phrase isn’t just for mean girls at a high school lunch table. Real estate is just as petty, especially in retail. When setting up shop in a new location most businesses want to be seen in cool buildings with other cool brands. It’s called co-tenancy, and real estate developers have to play musical chairs to get all the cool kids to show up to the party at once. For example Chanel may not sign a lease unless Louis Vuitton agrees to locate in the shopping center as well. Louis Vuitton may not show up if Cartier and Bvlgari aren’t coming. Companies like to be next to other brands that have a similar customer base so that they can cherry pick some of their clientele. Hotels and restaurants also choose their location based on who and what they will be surrounded by. In the above photo of the Miami Design District, those buildings were just warehouses, but now they are inhabited by luxury brands that will likely turn more profits because they are located near each other.
Now you can identify a few of the characteristics that can influence real estate’s desirability, value, and ultimately its sale price. If you choose to invest in real estate your homework doesn’t stop here. Keep reading commercial real estate content so that you can analyze the profitability of a piece of property. As the saying goes “If it doesn’t make dollars it doesn’t make sense”. People are out there winning in real estate daily, and if you get serious you’ll find yourself sitting at the table with cool kids and owning a piece of pop real estate!
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