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Press Release: Real Estate Forecast 2022

November 17, 2021

Photo By Meredith Edlow

ULI and PwC Release Annual Emerging Trends in Real Estate® 2022; Leaders Share Best Practices for Developing a Resilient Region and Industry at ULI’s Annual Real Estate Forecast

Hundreds of real estate and planning leaders convened at 22nd Annual ULI Philadelphia Real Estate Forecast; Embracing change and despite challenges, experts and leaders optimistic about the year ahead.

On November 16th, real estate experts, ULI members and industry professionals met to share strategies and best practices on developing a more resilient region in the face of compounding challenges, and discuss Philadelphia’s position among national trends detailed in the Emerging Trends in Real Estate® 2022 report released by ULI and PwC on October 14th. Hundreds of ULI members and public and private industry leaders joined ULI Philadelphia for its 22nd Annual Real Estate Forecast, delivered both in person and virtually. Key local leaders across sectors addressed unprecedented vulnerabilities including climate change, public health, cybersecurity, infrastructure, and supply chain challenges. Despite these concerns, practitioners remained optimistic about the year ahead provided strong market fundamentals.

The report noted of the past year “The theme that emerged more than any other during the Emerging Trends interviews with industry leaders was the surprising resilience of the economy and of property markets generally, inspiring greater confidence in the industry’s collective capacity to adapt to changing market conditions and future unknown risks,” a theme consistent in this year’s local discussions.

Former Mayor Michael Nutter, during a fireside chat with John Grady of Wexford Science and Technology discussed the need for cross-sector collaboration, noting “Leadership does not only reside at City Hall, in Harrisburg, or in Washington… All of this disruption creates opportunity for people to step up.” Nutter and Grady went on to discuss how the public and private sectors can work together to set and achieve bold goals to create a more resilient city.

Later, a local panel of experts, moderated by Saleem Chapman, Chief Resilience Officer of the City of Philadelphia, explored resilience from the perspectives of supply chain, cybersecurity, and climate change. The panel discussed the need for a systemic approach to building resiliency, noting that focusing on just one piece of a system will not create the desired outcome.

Bill Staffieri, Partner, PWC presented the findings of the Emerging Trends in Real Estate 2022 Report. In recognizing industry optimism for the year ahead, including at higher levels in the Philadelphia region compared to the national average, Staffieri noted “84% of survey respondents have said [2022] is going to be good to excellent for their businesses, and that’s the best we’ve seen since 2016.”

“Developers see things as they can be, not as they are and work with architects, engineers, planners, public officials, capital markets experts and the community to shape the world according to a vision of what can be. We certainly do not have the ability to solve [all of] these challenges on our own.  But, our industry is a part of the problem so we must be part of the solution. ULI is a place for us all to gather to discuss potential solutions and chart a course forward. At a time when public discourse around difficult problems is sometimes brought to the lowest common denominator, we can create a safe place to talk about creative solutions based on shared values and mutual benefit.”

Anne Cummins

Chair of ULI Philadelphia and Chief Operating Officer at Gattuso Development Partners

Trends highlighted in the report include the following:

  • A brief and muted real estate downturn. The overall economy has seen a rebound far exceeding expectations. Not only has economic output already recovered to pre-pandemic levels, but also growth is forecast to be at its highest rate in decades in 2021 and 2022.
  • The housing affordability crisis. Housing affordability worsened during the pandemic. With housing production falling far short of new household formations, affordability will likely continue to deteriorate in the absence of significant public- and private-sector intervention.
  • Working from home may mean less need for office space. Industry leaders predict that the need for office space will likely decrease 5 to 15 percent within the next three years. Office tenants will look to redesign the space they have and do more with less to accommodate new ways of hybrid working.
  • The great relocation? The number of highly paid office workers making the move away from their workplace has been relatively limited. Potential employee moves could rise as firms delay the return to work or formally make remote work a permanent option.
  • Investment in alternative sectors. Real estate investment trusts (REITs) and private investors have been much quicker to embrace a broader variety of “alternative” sectors, ranging from niches such as student housing, to life sciences, data centers, and cold storage.
  • The maturation of proptech. The pandemic provided new impetus and scope for adoption of property technology as the need to better assess and allocate investments and to understand and manage properties accelerated sharply.

The final panel of the main program, moderated by Lauren Gilchrist of Longfellow Real Estate Partners explored how these trends are playing out locally in various asset classes. In particular, Gilchrist noted the striking similarity between the growth of industrial over the last five years, and the growth of Life Sciences today, with an emphasis on the need for housing that meets the needs and preferences of those workforces.

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About ULI Philadelphia

The Urban Land Institute (ULI) is a nonprofit education and research institute whose mission is to shape the future of the built environment for transformative impact in communities worldwide.  Established in 1936, ULI today has more than 45,000 members around the globe representing the entire spectrum of land use and development disciplines. The Philadelphia District Council (ULI Philadelphia) includes nearly 900 members throughout the Philadelphia metro, Central Pennsylvania, the Lehigh Valley, Southern New Jersey, and Delaware. For more information, please visit philadelphia.uli.org.

About Emerging Trends in Real Estate ®

Emerging Trends in Real Estate® is a trends and forecast publication now in its 43rd edition, and is one of the most highly regarded and widely read forecast reports in the real estate industry. Emerging Trends in Real Estate® 2022, undertaken jointly by PwC and the Urban Land Institute, provides an outlook on real estate investment and development trends, real estate finance and capital markets, property sectors, metropolitan areas, and other real estate issues throughout the United States and Canada.

ULI Philadelphia Real Estate Forecast 2022

  • ULI Philadelphia Real Estate Forecast 2022

    Photo By Meredith Edlow

  • ULI Philadelphia Real Estate Forecast 2022

    Photo By Meredith Edlow

  • ULI Philadelphia Real Estate Forecast 2022

    Photo By Meredith Edlow

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