Decision in Election Year

We often see businesses, large and small, reluctant to make major decisions regarding real estate during an election year. And while this is the case for some, we also see many others who, by way of necessity or opportunity, are compelled to decide a course of action regarding their real estate. While businesses must consider the outcomes and impacts of pending elections, short-term and long-term risk-reward calculations are made when evaluating whether a company or individual should proceed with a certain real estate transaction, or not, in an ‘election year.’ These decisions should be made with careful consideration and interpretation of available research and market data, coupled with a clear outlook of strategy implementation. Here are a few examples of compelling reasons to make a deal in an election year. ​

Strategic Planning: 
The longer-term strategic plan that a company is pursuing can result in timely decisions needing to be made in “election year(s).” Dealing with specific expansion goals or savings initiatives, capital improvement projects, or business market share opportunities are examples of compelling reasons to forge ahead with a real estate transaction, even with the uncertainty of the election outcome pending.  Elections can bring changes to economic policies which can impact both the occupying business and the landlords through the numerous ways that real estate is taxed and regulated.  Being informed of the implications of potential changes to policy will place decision makers in the best position to adapt and ensure operational continuity.
 
Market Opportunities:
Many real estate decisions are made in an election year, as the lead up can create opportunities through market fluctuations and sector by sector volatility.  Furthermore, central banks may adjust interest rates based on economic conditions and political developments, as they seek to impact behavior and decision making. Changes in interest rates can affect borrowing costs, which in turn can impact the decisions being made by both sellers and buyers of real estate, and by business owners looking to sustain or grow their business. Additionally, these changes may affect a business’ Strategic Planning, as noted above.  Those with longer term outlook see this volatility as creating opportunities, motivating real estate decisions as they search for favorable conditions in certain types of transactions. 
 
Lease Expirations and Renewals:
One of the most compelling reasons for real estate transactions in an election year is pending lease expiration dates.  Businesses with leases set to expire may need to make decisions about renewing or relocating their industrial space. Ignoring these time-sensitive matters could lead to operational disruptions and negatively impact the bottom line. 
 
There are other unique reasons for making a real estate decision in an election year, but it first starts with understanding your objectives and talking with an experienced real estate agent who specializes in the property type you are working with.  From there, a course of action will begin to be uncovered for your unique situation. Contact us today to make this year as opportunistic for you as possible.