How the Pandemic is Affecting Commercial Real Estate
It’s safe to say that the COVID-19 pandemic has affected us all. People can no longer meet, work, eat, shop, and socialize like they used to. The working world has moved from business as usual to cautious travel and remote working. The pandemic has not just sparked health and personal financial concerns – but has impacted just about every industry and commercial interests.
Most real estate players have been smart to begin with decisions that protect the safety and health of all employees, tenants, and other end users of space. The smartest will now also think about how the real estate landscape may be permanently changed in the future, and will alter their strategy. It is clear that things cannot resume and go back to normal, but that the commercial real estate sector must strengthen their position through the crisis and adapt.
Real estate owners are also considering the potential longer-term effects of the pandemic and the required changes that these shifts are likely to bring to the market. For example, commercial office space is often built with open-plan layouts to keep with the trend of free-flow thinking and collaborative work. However, public health officials may increasingly amend building costs to limit the risk of future pandemics, such as alerting square footage per person and limited the amount of enclosed space.
At the same time, just as baby boomers age into the sweet spot for independent and assisted living, fear of viral outbreaks like COVID-19 may prompt them to stay in their current homes longer.
Before the pandemic, consumers were already shifting their spending away from physical stores. This trend may accelerate even faster after the crisis. As the drive to improve e-commerce excels during this time, we may see closed malls and fewer independent businesses returning to their stores.
At Fidelity Mortgage Lenders, we are here to help during this troubling time. If you have questions or concerns about your commercial property loan, give us a call today.