Flood Costs in Several States’ Commercial Real Estate Set to Soar

According to a study published by the First Street Foundation, flood damage from climate change could cost the commercial real estate industry $ 16.9 billion annually through 2052.

The research group prepared the report together with the Arup engineering office. Both companies are based in New York.

“A total of 729,699 retail, office and apartment buildings in the adjacent United States are threatened by flood damage,” says the study.

“The annual cost of repairing or replacing damaged buildings could increase by about 25% from $ 13.5 billion in 2022 to over $ 16.9 billion in 2052 due to climate change.”

Florida, Pennsylvania, California, New York, Texas and Virginia will suffer the worst next year, the report said.

The negative impact on the local economy could be $ 63.1 billion in 2052, up 27% from $ 49.9 billion in 2022.

“Flood damage to commercial buildings could lead to 3.1 million business days lost due to repairs in 2022,” the study says. That could increase 29% to 4 million days by 2051.

“Damage to commercial buildings has both revenue and downstream consequences for metropolitan areas and states,” the report said.

In other real estate news this month, Dana Anspach, President of Sensible Money, on TheStreet.com, explained how financial advisors can incorporate income-generating real estate into a financial plan.

“Many rental property portfolios are cash flow positive but tax negative or neutral,” she said in an interview with Robert Powell of TheStreet.com. “And that’s not easy to model with most financial planning software packages.”

Vanguard real estate ETF (VNQ) – Get the Vanguard Real Estate ETF Report 33% year-to-date through Friday, according to Morningstar, compared to 27% for the S&P 500 index, including dividends.