Why smaller US cities are emerging as commercial real estate hotspots

Manhattan skyline during sunset, from the Top of the Rock observation deck, at Rockefeller Centre, in New York, US (Picture credit: Reuters) South Carolina ranks first among US states for future potential demand for commercial real estate, according to a new index by the National Association of Realtors (NAR) that tracks economic indicators linked to demand across the sector.The index covers more than 300 metropolitan markets and assesses future demand across four commercial real estate segments, office, industrial, retail and multifamily.Rather than focusing solely on current property prices or investment returns, the index uses economic and demographic indicators to identify markets where demand could be building.“It doesn’t say, ‘OK, go there and just buy property,’ but it says … where the data shows that the momentum is building, the demand is building,” Nadia Evangelou, principal economist and director of real estate research at NAR, told CNBC.How the NAR index measures future demandThe index uses government data from the Bureau of Labor Statistics and the Census Bureau, including information on employment, population growth and migration.For the office sector, NAR tracks grow...