There are some submarkets within real estate that Paul Larson, CEO of Larson Financial Holdings, just didn't want to go near last year — hospitality with hotels, for example, as well as retail. But there were also some incredibly bright spots.

So, Larson Financial Holdings focused mainly on three categories. One was industrial. There, company name was selling its stabilized industrial because it felt as if the market was at all-time highs.

"The profit that you can get out of that is crazy," Larson says. "There were things that we bought in the front end of the pandemic in industrial and by the time we got midway through 2021, the value of that investment had already doubled and sometimes even tripled, and we did nothing to it. We just held it for a year. And so, anytime you see that kind of a run up on the market, we're big believers of take your chips off the table and redeploy."

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He says the redeployment from the industrial investments went back to new construction. For example, he says they're building a $300 million warehouse facility in Albuquerque for a company that's coming in from out of the country, and they'll own their headquarters.

Another are of focus is multifamily. He says it was difficult to buy apartment buildings that were already built, leased up and ready to buy, as investors were paying extremely high prices where those existed.

"There are transactions that we saw in Phoenix and Austin and Nashville that we're in the threes, and that's just absurd to me that people are willing to invest in something and they if they paid cash, they would be willing to get a 3 percent rate of return on their money," Larson says. "That just is mind-boggling. So, for us, we went back into development. We went to buy the land. It's a two-year process to get there, and there's a little bit of a headache but we felt like, that's where return opportunity was."

Among the main macroeconomic factors that are expected to affect the real estate market in 2022 is a movement from the coasts inward towards a couple of key markets.

"And as the businesses follow the employees that have moved there, I think you're going to find that that growth begets more growth," Larson says.

Another trend he expects to play out is office tenants are looking for a specific type of experience in office as they come back. He says they recognize that they have to do things a little differently. Prior to the pandemic, offices were like cube farms, packing in as many people as possible. That just isn't going to cut it anymore.

"With The Great Resignation, people want to be taken care of," he says. "The employees want a better work experience. What we're seeing is our newer buildings that have more common space and a lot more cost put into the amenities, those are driving up significant amount of interest from tenants."

Larson spoke on the Smart Business Dealmakers Podcast about his company's 2021 in real estate, the trends that affected the market then, and how he sees it playing out in 2022. Hit play above to catch the full conversation.