Closing out the program, ULI Philadelphia concluded the Annual Real Estate Forecast 2022 with a panel discussion titled “Local and Regional Trends”. The panel was moderated by Lauren Gilchrist, Managing Director of Research at Longfellow Real Estate Partners. She was joined by panelists Howard Freeman, Senior Vice President and Investment Office at Prologis; Anish Kumar, Managing Director at Pennovation Works; and Lizann McGowan, Executive Managing Director at Newmark.

This panel focused on national emerging trends that our local experts are seeing in our region by asset class. With panelists representing the life sciences, multifamily, and industrial asset classes, this discussion covered the Philadelphia metros and surrounding suburbs’ supply and demand trends and the quickly evolving key users.

We are seeing changes in the industrial space, as explained by Gilchrist. Further delivery hubs have increased the costs of supply chains as the reliance on them has increased. Efficiency is increased where delivery hubs are migrated to urban cores via industrial acquisitions. As the industrial asset class shifts, urbanized blended work-play facilities are as well.

Kumar details that Pennovation Works originated as an innovation ecosystem whose key role is provide a framework by which innovation is converted into actual business. 5 years ago, the majority of Pennovation Works’ resident companies were robotics and businesses. This comes in stark contrast to today’s largely biotherapeutics and research lab business tenants. To better support the social structures needed in innovation zones, Kumar notes Pennovation’s strength in their curation process. Every company that applies for membership or space in the Pennovation center goes through a curation process ranging from business formation, investor readiness, public programs, and engagement opportunities with the local communities and schools.

Innovation and industrial are not the only asset classes quickly changing. Lizann McGowan provides insight on the multifamily sector’s rapid amenity space expansion, particularly in new development in the suburbs, Delaware, and the Lehigh Valley. Large amenity space popping up in new developments is incentivizing a demographic of people approaching retirement to sell their homes and move into multifamily alternatives. She emphasizes the importance of large amenity spaces, particularly during this pandemic, as a resource to keep residents connected and engaged with one another.

In examining workforce, Howard Freeman explained that industrial jobs are stable, long lasting, with increasing hourly wages, despite there being a stigma about this work. Warehouse, shipping, and transportation jobs are in demand and are a stable sector fueled by e-commerce and a struggling labor market.

The workforce issue drives Pennovation’s search in finding housing for the workers who are the engine behind the research. Kumar maintains that workforce is at the core of the continued growth of the life sciences.

To close us out, Lizann McGowan commented on national and local sentiments around affordable housing. Affordable housing is a growing trend and there is currently a strong desire to find housing products that satisfy both workforce demand and add value to primary and tertiary markets. We can expect to see more investors coming to Philadelphia!

Contributed by Sigourney Young. Sigourney Young is a student of Business Management at Jefferson University. She is an associate at ULI Philadelphia.