In a matter of weeks, lives across the U.S. have changed in ways we could have never imagined. People can no longer work, eat, shop, travel, and socialize as they had before. Instead of traveling, shopping, and going out to restaurants, many consumers are tightening their wallets to only spend on essentials.
Physical distancing has changed the way people interact and inhabit space and could potentially lower demand for certain types of spaces. This has created an unprecedented challenge for the real estate industry. The longer this pandemic continues, the more likely we are to see lasting changes in behavior.
Most property managers have been able to adjust their operations to protect the safety and health of both staff and tenants, but it’s important for real estate leaders to think about how the real estate landscape could forever be changed and adjust their strategies accordingly.
Americans have never before spent this much time in their homes; because of this we expect consumer preferences to shift. We’ve highlighted three primary shifts below:
Working from home
You can almost be certain that one result of this pandemic will be more working from home. Even once social distancing standards have been lifted, we suspect many people will continue to work from home at least part of the time. We’re curious as to how many people dislike their work space at home, or didn’t even have a space – you know, the ones that had to turn their kitchen table or living room into an office. Some consumers prefer a more separate office – a room at the front or even back of the home. In addition, the concept of at-home school spaces will be closely aligned with home office spaces. This includes quiet, dedicated environments that have easy access to technology such as a strong Internet connection.
In recent years, this has been one of the fastest-growing trends in home building and community design. Think: the rise of community gardens, energy-efficient appliances, and smart living amenities. Expect the pandemic to speed up these trends. New homes and commercial real estate projects have an advantage over resale in this category. Builders or property managers can sell the benefits of the smart living technology they implement into their projects moving forward.
“Surban” over Urban
“Surban” – a mix of urban and suburban living – is a recent trend that is expected to continue to attract millennials and young families looking for more privacy and open space. Since having to social distance, individuals are likely to continue to move to the suburbs. Some may refer to these areas as “mixed use.” Examples of these areas would include:
Downtown Naperville, Illinois, in the suburbs of Chicago
A-Town in Anaheim, California, in the neighborhood around Angel Stadium of Anaheim
Legacy Town Center in Plano, Texas, in the suburbs of Dallas
Downtown Tempe, Arizona, in the suburbs of Phoenix
In the post-pandemic age, customer-focused sensibility will be vital to best position existing assets in a competitive landscape. COVID-19 is likely to shape us in a way that will require our buildings and operations to be reshaped as well. Real estate owners and operators who are able to adjust and serve tenants’ needs on-site will help your community stand out among competition, positioning it to perform optimally in the new normal.