What does the “New Normal” mean for commercial real estate?
Published May, 6, 2020
Holly Gardner, President
We hear a lot of talk about the “new normal.” I was admittedly not sold on the concept when the coronavirus crisis first appeared. It is hard to accept that your reality will be forever altered. It doesn’t happen overnight…even for the most forward-thinking of us. It’s a progression, typically based on experience. Your experiences will change, and you adjust to them, and as you see others around you shifting, you begin to accept that perhaps a new reality is evolving.
That was my path. A slow progression. From a knee-jerk reaction that we were all overreacting, to the acceptance of the seriousness of this virus but a disbelief that it would change everything, to a realization that it won’t “go away.” Just as other major health risks have altered our behaviors over time, so will this. Albeit, with a forced shut down, the behaviors were altered much faster.
So what will this “new normal” mean for commercial real estate? How should we be shifting and adjusting our behaviors in the industry? There are market changes that will shift our behaviors, and there are some deeper questions on building health and tenant needs that we need to be asking ourselves.
The unavoidable market changes as a result of Covid-19 have forced the end of the cycle that we’ve all been waiting for. Some are not ready to accept that the cycle is resetting, but I truly believe it. How could it not? We cannot reopen the economy overnight and the longer we’re restricted, the more tenants, businesses, and investors that are affected. And this is not just a local or national issue – it’s an international issue.
On the construction side, if we had issues with material costs and availability before, it’s going to be nearly impossible now. Manufacturing is struggling to get product out at reduced levels, and more money is not going to fix the issue. Many laborers are making more money on unemployment than they were as full-time employees, making it very difficult to convince someone to voluntarily return to work at the risk of their health for no increased compensation. So, we have now further restricted already restricting factors in the industry…labor and materials. We were overcoming these, just barely, by paying more money and driving rents to cover the additional expenses. We cannot continue to drive rents in this economy, so what options are left to us?
On the tenant side, businesses are re-thinking how they operate and how much space they really need, now that they’ve seen what they can accomplish remotely. Public gathering spaces, including restaurants, retail, and stadiums will still be avoided even after they’re allowed to reopen, impacting bottom lines. We’ve already heard that as much as 50-80% (depending on your source) of our restaurants may not survive this. We are all re-evaluating how we operate both personally and professionally. We also need to be re-evaluating how our buildings operate.
As we do during any downturn, we look for ways to innovate. How can we do it better? This is no different, except we have one very clear direction to focus our innovation around….the health of our buildings and tenants.
At The Schuster Group, we’re doing the simple things like so many: 1) Adding sanitation stations, 2) Creating building policies to better protect tenants and their customers, 3) Looking at cost effective improvements that help minimize exposure to germs and viruses. But we’re also thinking long term. How do we create spaces that encourage physical distancing and social interaction? How do we build flexibility into offices to allow for reduced footprints, but the same efficiency for those companies embracing remote working? How do we create street front spaces that engage the public for retailers, but allow them to operate in a manner that encourages “new normals” like online shopping and package pick-up? How do we create multifamily communities that meet the needs of physical distancing, but provide the amenities needed? We should all be asking ourselves these questions and thinking critically about the possibilities. Innovation creates opportunity, which creates growth. We need to grow our way out of this current predicament. So let’s innovate.
We’d love to hear what you are considering in your business. Please feel free to email or comment below. Innovation is best when not done in a vacuum!
Hello i am kavin, its my fiгst occasion to commenting anywhere, when i read this article i thought i could also maкe comment due to this
ѕensible post.
Comment by dexedrine — May 21, 2020
Howdy! Do you know if they make any plugins to help with Search Engine Optimization? I’m trying to get my blog to rank for some targeted keywords but I’m not seeing very good results. If you know of any please share. Kudos!
Comment by Verdie Marquardt — May 28, 2020
https://waterfallmagazine.com
Hi mates, its fantastic piece of writing on the topic of
cultureand completely explained, keep it up all the time.
Comment by waterfallmagazine.com — June 4, 2020
I simply want to mention I am just beginner to blogging and site-building and honestly savored your web site. Probably I’m planning to bookmark your website . You really have great articles and reviews. Thanks for sharing with us your blog site.
Comment by Weldon Vendrick — July 5, 2020
Wow, great blog.Really thank you! Will read on…
Comment by Miss Date Doctor breakup package — July 23, 2020
Please take a look at the web sites we follow, such as this a single, because it represents our picks from the web.
Comment by Google — August 3, 2020
I simply want to mention I’m all new to blogs and certainly savored your blog site. Likely I’m planning to bookmark your website . You really come with great well written articles. Thanks a bunch for sharing your website page.
Comment by Malcom Rishty — August 7, 2020
Yes! Finally someone writes about web hosting.
Comment by web hosting company — August 8, 2020
Howdy! Would you mind if I share your blog with my twitter group?
There’s a lot of people that I think would really enjoy your content.
Please let me know. Thanks
Comment by best web hosting 2020 — August 8, 2020
This website was… how do you say it? Relevant!!
Finally I’ve found something which helped me. Thanks a lot!
adreamoftrains website hosting companies
Comment by adreamoftrains hosting services — August 9, 2020
The time to read or go to the content or web-sites we’ve linked to below.
Comment by Google — August 11, 2020
EKbgLDaG
Comment by DbGpBruQlVg — August 14, 2020
Excellent article. Keep writing such kind of information on your blog.
Im really impressed by it.
Hello there, You’ve performed an incredible job.
I will definitely digg it and personally recommend to my friends.
I’m confident they will be benefited from this site.
Comment by Rosaura — August 17, 2020
BNZPankiAE
Comment by uwLGTJra — September 18, 2020
KrvGBR Please let me know if you run into anything. I truly enjoy reading your blog and I look forward to
Comment by is cbd legal in washington dc — September 25, 2020
lsBpHNYxDXUauVP
Comment by JERKqkyCLxOdvtP — October 17, 2020
RqGPUCzv
Comment by SgFAJiwpWLGXVOYu — October 30, 2020
You could definitely see your enthusiasm in the work you write. The world hopes for more passionate writers like you who are not afraid to say how they believe. Always go after your heart.
Comment by Maximina Yournet — November 3, 2020
Please let me know if you’re looking for a article author for your site. You have some really good articles and I feel I would be a good asset. If you ever want to take some of the load off, I’d really like to write some articles for your blog in exchange for a link back to mine. Please send me an email if interested. Thank you!
Comment by Abdul Tavera — November 5, 2020
Hi to every body, it’s my first go to see of this
website; this webpage includes awesome and genuinely good material for readers.
Comment by camo phone case — November 9, 2020
IAHigvqTXlaZz
Comment by pmauyvRKSocCPJ — November 14, 2020
ljGscVhbEJAyq
Comment by fkIRguAbnKeYWFhM — November 14, 2020
ngZQlI this this web site conations in fact pleasant funny data
Comment by washington dc — November 18, 2020
KGgXIEcJCm
Comment by qhSElpriXxVPujU — December 1, 2020
rfpNMgwFnsZDqb
Comment by TWhyUdML — December 17, 2020
Thanks for the marvelous posting! I definitely enjoyed reading it, you’re a great author.I will remember to bookmark your blog and will eventually come back sometime soon. I want to encourage you to ultimately continue your great work, have a nice holiday weekend!
Comment by Lacy Tarasuik — December 19, 2020
Hey there! I’ve been reading your site for a while now and finally got the courage to go ahead and give you a shout out from Lubbock Tx! Just wanted to tell you keep up the excellent work!
Comment by Ivory Berglund — December 25, 2020
pfAtZLDUTiYBFaNy
Comment by iMSwCsTyuYaOU — January 1, 2021
I always was interested in this subject and stock still am, regards for putting up.
Comment by Emanuel Deritis — January 4, 2021
qXGKCwjFTSxA
Comment by nUMxftqw — January 15, 2021
ndkMjXgCuHr
Comment by EcbGOjMBSUhT — January 16, 2021
Thankfulness to my father who informed me concerning this blog, this website is truly remarkable. Carleen Carmine Kahler
Comment by recep ivedik 5 izle — January 19, 2021
Just wanna tell that this is handy , Thanks for taking your time to write this. Ethel Link Melania
Comment by porn — January 21, 2021
Every after inside a whilst we select blogs that we read. Listed beneath are the most current web pages that we choose.
Comment by Google — January 22, 2021
You made some good points there. I did a search on the topic and found most folks will agree with your blog. Konstance Drugi Burty
Comment by 720p — January 29, 2021
At this time I am ready to do my breakfast, afterward having my breakfast coming over again to read other news. Toma Karlan Fe
Comment by bollywood — January 30, 2021
My favourite cool/cold weather food-homemade soups, and this one fits the bill- comforting, nourishing, all in one pot, and using a rotisserie chicken shortens prep time by a lot. Will be a go-to for sure. Melina Teador Bohi
Comment by turkce — January 30, 2021
I go to see everyday a few sites and blogs to read posts, except this website gives quality based writing. Agatha Byram Ringo
Comment by filmkovasi — January 31, 2021
Thanks for sharing, this is a fantastic blog article. Thanks Again. Great. Giralda Anatole Cordle
Comment by online — January 31, 2021
Though I can not make simple rhythmic step, but I find every word of the blog is rhythmic. Hats off to your passion. Tess Carlo Chesna
Comment by bollywood — January 31, 2021
great points altogether, you just won a brand new reader. What may you suggest about your post that you simply made some days ago? Any positive? Marianna Dom Bainbridge
Comment by dizi izle — February 1, 2021
After I originally left a comment I seem to have clicked the -Notify me when new comments are added- checkbox and now every time a comment is added I recieve 4 emails with the exact same comment. Perhaps there is a way you are able to remove me from that service? Thank you! Brunhilde Loren Asta
Comment by 720p — February 1, 2021
Do you mind if I quote a few of your posts as long as I provide credit and sources back to your site? My website is in the exact same area of interest as yours and my users would truly benefit from some of the information you provide here. Please let me know if this okay with you. Cheers! Mamie Leonardo Pallaton
Comment by movies — February 1, 2021
Nice post. I learn something new and challenging on blogs I stumbleupon every day. It will always be useful to read through articles from other authors and use something from other web sites. Erinn Quintin Maxey
Comment by netflix — February 1, 2021
I do believe all the ideas you have introduced for your post. Rheta Darin Ganiats
Comment by online — February 6, 2021
I could not refrain from commenting. Perfectly written! Gwynne Justinian Ulani
Comment by yabanci — February 6, 2021
Omg, such a pretty attractive and very stunning cake, i cant cut this cake. Beautifully decorated cake to cut and enjoy. You rock Ritu. Mirelle Jeffy Noland
Comment by filmkovasi — February 6, 2021
great points altogether, you just gained a new reader. What could you recommend in regards to your submit that you simply made some days in the past? Any certain? Lark Marwin Gareri
Comment by movie online — February 6, 2021
ID203313861509A ini dilacak sudah dikolaka ada nomor yg bisa dihubungi ka? Arabel Humfried Modesty
Comment by aksiyon — February 10, 2021
NaVYqWMcCjJ
Comment by sQzVgmZqXoOW — February 13, 2021
yAvWuogp
Comment by MJVptNQyH — February 13, 2021
Just beneath, are quite a few absolutely not connected websites to ours, on the other hand, they’re certainly really worth going over.
Comment by Google — February 20, 2021
FclRIpLfjXmgvUxw
Comment by civlexQR — February 26, 2021
vXgriFwVUa
Comment by oqszvpRJHwB — February 26, 2021