On November 15, 2021, President Biden signed into law the Infrastructure Investment and Jobs Act (IIJA), which is commonly known as the “infrastructure bill.” This wide-ranging piece of legislation allots $1.2 million in spending to address the nation’s fragile infrastructure system. Among the areas addressed in the bill are traditional transportation concerns such as roads and bridges, railways, and public transit, but the bill also earmarks money for such newer areas of focus as broadband, electric vehicles, and climate change planning.
Although the infrastructure bill does not directly address commercial real estate, it is already having a strong effect on all aspects of the industry, including building, planning, and commercial real estate appraisals. The legislation is expected to spur growth and largely benefit the industry.
Here are a few major areas affected by the infrastructure bill:
1. Improved Transportation Will Improve Overall GDP. With better networks of transportation established across the country, goods can be delivered more efficiently, helping to maximize profits. Although this may have a more direct benefit for the industrial sector, increased growth will also spur commercial development and improve the prospects for the CRE industry as well. A better infrastructure will also increase property values.
2. Environmental Benefits Will Allow Commercial Developers to Save Money. Renewable energy is not only better for the environment but a more efficient and less expensive power source. Although switching to a more sustainable energy source can be expensive, the infrastructure bill offers plenty of assistance for developers looking to “go green.”
3. The Infrastructure Bill is Unlikely to Cause Inflation and May Even Lower It. Although many pundits were concerned that the bill was likely to cause inflation, this does not appear to have been the case. Simply put, the additional funding provided by the infrastructure bill does not amount to enough to drive inflation. There is also a significant time gap between when the money leaves the treasury and when it enters the real economy. In addition, since some of our current wave of inflation is related to supply chain issues and consumer demand, the bill may actually help by getting goods moving faster through the country’s roads.
4. Skilled Commercial Appraisers are More Important than Ever. With plenty of new commercial development expected to take place soon, the importance of a reliable appraiser has never been more significant. With properties adopting new green infrastructures, you need to make sure you have a knowledgeable professional who knows the ins and outs of the contemporary market and its latest developments.
If you’re unsure of how the infrastructure bill will affect commercial real estate appraisals, the professionals at Appraisals Unlimited can help. Our commercial appraisers have been providing top-of-the-line appraisal services for over 25 years.
Contact us today to find out more about our services.
If you’re interested in learning more about these solutions or need an appraisal today, don’t hesitate to contact Appraisals Unlimited, either by calling 781-449-7600 or emailing us at firstname.lastname@example.org.