Pipeline entries are real estate development projects that have entered the pipeline (have acquired a building permit and / or had their plans approved, but that have not yet become “starts” / broken ground.
Knowing the total rentable area (RA) involved in pipeline entries in a real estate market (for a specific real estate asset class, in a defined geographic area) is foundational for estimating new construction (real estate supply).
New construction is the most critical and important supply concept driving real estate markets.
The term new construction refers to completions. The new supply of real estate has three stages, commonly referred to as the “pipeline.” These are marked by three project milestones:
1. Permit (or pipeline entry): the development receives the permit or permission of the authorities based on approved plans.
2. Start or startup of construction, which usually means that “shovels are in the ground” but can be more complicated.
3. Completion: the property is given occupancy certification.
