In an era of economic uncertainty and evolving consumer behaviors, the American real estate landscape is undergoing profound changes. The recent report by PwC highlights challenges such as rising interest rates, declining GDP, and reduced deal flows, signaling a temporary downturn in the real estate market. However, Quattro Development, led by founders Rob Walters and Michael Liyeos, is no stranger to navigating such challenging terrain. In fact, they’ve embraced these challenges as opportunities to innovate and reshape the future of commercial real estate development in the United States.

Rob Walters and Michael Liyeos founded Quattro Development in 2008, a bold move amidst the Great Recession. Their resilience and visionary approach have propelled Quattro Development to new heights. With decades of combined experience in commercial real estate, they possess the insight and expertise needed to adapt to the ever-changing market dynamics.

The aftermath of the pandemic has brought about seismic shifts in the industry, prompting Quattro Development’s founders to reflect on the future of commercial real estate in America.

One of the pressing issues they identify is the continually rising construction costs. According to CBRE’s report, construction costs in 2023 are predicted to remain high, with a projected 5.4% increase. Michael Liyeos observes that tenants increasingly demand spaces tailored to their specific needs, making retrofitting existing structures less viable. This, combined with soaring construction pricing, makes starting anew from the ground up a more attractive option.

However, the challenges extend beyond cost considerations. The complexity and time involved in construction are also significant factors affecting the industry’s direction. Liyeos emphasizes that municipalities and governing bodies responsible for permitting have become bottlenecks for development due to understaffing and intricate zoning codes. Even for ground-up construction, subject to heightened scrutiny and approvals, the process remains complex.

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