The Continuing Impact of COVID on Commercial Real Estate
How the pandemic continues to affect the real estate market. Businesses that own office buildings and hotels, or those that lease space to bars, restaurants and other retailers have been the hardest hit area of ââcommercial real estate, as the pandemic has forced many businesses to be closed temporarily or to operate on a limited basis.
Commercial real estate trends may take longer to recover as businesses reassess their needs after the pandemic. We spoke to Danny Court, director and senior economist of Elliot D. Pollack & Company.
It explains why and what is impacted the most. He said more people were leaving spaces than signing in new places. They see a lot of vacancies. He said they are even close to 20 percent.
Working from home is here to stay, so they think it will be a hybrid come in person at home. He said they will likely see more space for employees. He said just before the pandemic they were seeing very, very crowded office spaces.
Nowadays, some areas may not be at the top of people’s lists such as gyms and fitness areas. He told us it’s too early to tell with much of this.
We looked at the retail area. He said they’ve been struggling for a while now because people buy things from home.
He said retailers are being pushed to industrial markets and warehouses instead of physical spaces. The court also said that retailers were not investing in new locations as in the past. Arizona has a “pretty strong retail market here.” he said.
We talked about solutions and what a good balance is for those areas. He said it is important to introduce residential areas to help commercial areas.
We are also talking about this area has changed for good. He thinks so and that a lot of formats are here to stay.