Which of the following is an indicator of market demand for commercial real estate?

Population growth in an area serves as a significant indicator of market demand for commercial real estate because it reflects an increasing number of potential tenants and consumers who can support various businesses. As the population rises, demand for commercial spaces, such as retail stores, offices, and service venues, typically increases as well. This growth can lead to higher occupancy rates in existing properties and incentivize new developments.

An increase in population often correlates to more jobs, higher spending power, and an expanding local economy, all of which create a fertile environment for commercial enterprises. Consequently, real estate developers and investors pay close attention to demographic trends as they indicate where to focus their investments and how to gauge future demand in the commercial market.

While other factors like average rent prices, property tax rates, and the number of properties listed for sale can also provide insights into the real estate market, they are often reflections of current conditions rather than direct indicators of future market demand. Population growth offers a more fundamental basis for assessing and predicting demand dynamics.