Flexibility Holds Key Nov25

Flexibility Holds Key...

COVID-19 has had a jarring impact on commercial real estate in the form of health risks, stunted growth prospects, permit and construction delays, reduced income for property owners and the acceleration of e-commerce at the expense of physical stores, among other disruptions. The pandemic precipitated what global management consultant firm McKinsey & Company calls “an unprecedented crisis for the real estate industry.” What will the CRE landscape look like when the pandemic fades? For one thing, new building codes designed to limit the risk of future pandemics could affect standards for HVAC, square footage per person and amount of enclosed space. Office building tenants will almost certainly be driven “to look beyond their traditional building preferences. In this new environment, tenants will gravitate towards the properties that best solve for flexibility, adaptability, and well-being,” according to Erin Saven and Evan Danchenka of Gensler, a global architecture, design and planning firm. Maria Sicola, a founding partner of real estate planning services provider CityStream Solutions and sales and training consultant Integrity Data Solutions, believes tenants will likely make their space “more personalized and less communal – we will likely not return to all-private offices and fancy conference rooms. But all space – personal and meeting — will need to be viewed with more breathing room.” And, of course, cleanliness will command more attention than ever. Commercial Property Executive predicts that “some products and techniques that have been used in medical office buildings and in hospitals are going to be brought to the office sector,” such as microbe-resistant door handles and elevator buttons and sanitation with ultraviolet light. Amenities as differentiators Building owners and developers, for their part, would be well advised to explore “new real estate design strategies that can differentiate them from the competition and...