COVID-19: Implications for real estate
Neil Bullen
Global Managing Director, Real Estate
COVID-19 poses an unprecedented challenge to all sectors within real estate. Despite bricks and mortar being immovable by nature, the real estate industry has become more agile in recent years, moving towards shorter leases, diverse portfolios and accelerated cycles of innovation, giving it better tools to deal with the current crisis.
Even in times of difficulty, there is still opportunity. While some sectors, particularly hospitality and retail must adapt to a scenario where they may have little or no short-term income, we are seeing demand increase for sectors providing critical goods and services, such as food and grocery, ecommerce, life sciences and data centres.
Specific action plans for real estate clients are essential to mitigate the impacts of COVID-19.
Dynamic action plans for real estate clients:
- Establishing (and sustaining) new ways of working remotely – collaborating better across teams, using digital, social media and communication platforms to drive projects forward.
- Getting continuity plans in place – able to adapt rapidly to changes in people, delivery plans and market shifts.
- Re-shaping their portfolios and capital investment – whether increasing or shrinking, rapidly assessing scenarios, impacts, risks and opportunities.
- Keeping construction going – while considering the safety and welfare of those involved, keeping the build going is key to progress. Where projects do have to stop for a period, supporting them to manage and assess the impacts of demobilisation and planning/managing the re-start.
- Navigating the risks – challenges with materials, labour, supply chain and logistics are all areas that require close scrutiny, management and resilience to deal rapidly with change.
- Using this window to ‘get fitter’ – many clients want to catch up on those things they should have done, invest in research and development (R&D) and gain competitive advantage.
- Horizon scanning – looking at markets and trends, and using these to help clients navigate through COVID-19.
- Planning for the ‘bounce back’ – COVID-19 is finite; it will pass; things will start to return to normal. Help clients plan and get ready – there will be pent up/strong demand as markets start to return.
Further resources
Please visit our COVID-19 response page for all of our resources relating to the impact of COVID-19 on the construction sector.