A great location has an abundance of natural light.
Sunshine feels good. It’s warm. It’s inspiring. It’s relaxing. People like sunshine and natural light. So why not invest in real estate markets or specific locations where the rays of the warming sun are plentiful?
Outside of our major U.S. urban cores, some of the greatest retail and restaurant volumes are found in warm, sunny climates. San Diego, Denver, Honolulu, Los Angeles, Las Vegas, Miami, Dallas, Houston, Phoenix are all examples of places where the sun dictates specific segments of the local and state economy. We can debate dry heat versus hot oppressive heat. We cannot debate that people around the world are aware of these cities, in part, due to the relatively abnormal amounts of sunshine that can be enjoyed within them.
The frequency of sunny days means more natural light is available each day. There have been studies completed that measure human happiness or depression relative to the availability of, and exposure to, natural light. In the workplace, productivity trends higher when natural light and open windows are used in lieu of light bulbs. In the world of retail and restaurants, people love the ‘open-air bazaar’ or ‘al fresco dining’ experience where light encompasses all.
People are drawn to these types of environments and will pay more to visit, linger and experience something grand or even nothingness within them. Of course, ideal real estate investments are harder to find in these markets for potential owners. The same holds true as it relates to high rental rates and low vacancy rates for tenants in search of available space. As natural light makes locations great, so too must one’s patience be in finding one.