The US Commercial Real Estate market is valued at $2.5 trillion dollars. Do you think post Covid it will be the same -back to normal – the way it used to be?
Nope, neither do I.
Even before Covid struck its nasty hand into our world, companies like Microsoft, Google and many financial institutions were looking to hire talent, not necessarily find and move someone, who will report to an office 1,000 miles away and have to uproot his or her family…especially when they can work from home or a satellite office or even from a Starbucks?
NO, my friends. Not anymore. Yes, parents want their children to go back to school. People want to go out and socialize to go to dinner or a sporting event or bowling or visit places they have postponed.
And they want to go back to work, just not the way they went to work before.
They don’t want an hour commute. They don’t want to be stuck in traffic. They don’t want the gasoline expenses or the parking expenses and frankly, big companies are looking at smaller satellite offices where employees can go in some days; part of the day; or perhaps once every two weeks depending on when they are really needed to be there,
According to a recent article (some excerpts) in the NY Times of January 5, 2021:
It’s not hard to imagine, after working from home for almost 9 months, that many will once again prefer to work within walking or biking distance of home rather than live in suburban enclaves where their commute can be upwards of 90 minutes EACH WAY.
Residential areas, street retail shops and hotels may have to accommodate more daytime workers. Signs of this shift are already visible. The nation’s largest multifamily operators, Avalon Bay Communities and Equity Residential, have been adding work and meeting spaces to their buildings for a few years now.
Common, the largest co-living operator, is partnering with local governments to develop new types of live/work communities. Hospitality brands like Starbucks, CitizenM and Mandarin Oriental have been experimenting with converting local coffee shops and hotel floors into work spaces that can be booked by the hour or day. And city governments are working to redistribute jobs and services across residential neighborhoods.
Some large employers are already experimenting with satellite offices in the suburbs of cities in which they already have a downtown headquarters. The main office will remain important for most companies, but fewer employees will be expected to be there all day, every day.
Similar to the “retail apocalypse” that led to multiple bankruptcies and the closing of tens of thousands of stores which was a result of less than 12 percent of all activity moving online, over a period of two decades, while total sales were still growing, the transformation of the “main office” will probably happen faster and to an industry that is far less prepared.
How prepared will you be to see the opportunity in these changes?
How will you adjust to building company leagues or inviting people into your center for office parties, fund raisers and special events?
How will you repurpose your party rooms into work spaces for daily weekly or monthly rentals?