2020 The Year of COVID, or Year of the Pivot?
Gadens looks ahead to how the world and the property industry will be changed by COVID-19.
The COVID-19 pandemic has affected society and business more than any event in recent history. It has not spared any industry or sector, creating immense opportunity for a lucky few and decimating many others.
In response, Gadens have seen businesses pivot, whether by expanding their service offering, changing their method of delivery or reallocating their workforce. In part, this has been allowed through the quick actions of Governments at all levels, and financial institutions, to meet the now very different needs of business. Obvious examples are:
- JobKeeper and JobSeeker payments
- Leasing code of conduct
- Relaxation of planning and land use requirements to allow operational changes
- Land Tax relief
- Payroll tax relief
- Government backed cash flow boost loans
- Deferral of loan repayments
These are terrific short-term assistance packages, but the real impact or opportunity will come as we move out of the COVID-19 era into whatever is beyond. The changes people have had to make during the COVID-19 pandemic are now being analysed to inform what our workplaces and residences could look like in a post-COVID-19 world.
Gadens are seeing several key themes emerge and evolve. As a starting point, due to the international impact of COVID-19 and the likelihood of ongoing tough international travel restrictions, we believe that a local focus will be critically important. Further, there is an increased focus on health and family time, support of local and Australian businesses, a desire to travel domestically (until international borders are reopened) , and reliance on home delivery solutions.
As a legal services provider to clients in all areas of property, Gadens are already seeing our clients look at how those themes will impact and drive the property sector post-COVID-19. It seems to be commonly understood and accepted that the current norm is unlikely to continue to apply and that as society and business pivots, so too will their use of property.
This means that we are likely to see the following trends:
- a continuation of the recent trend in mixed-use, and/or place making developments, allowing residents and businesses to create community driven micro-economies
- the rejuvenation of suburban high streets.Suburban Centre Improvement Projects, funded by local government, will greatly assist with this
- CBDs continuing to play their role as business hubs, and aspirational places of visitation for shopping and socialising
- a proliferation of flexible working spaces, including reconfiguring of existing office environments.There may also be a push for a de-intensification of use of office space for health and safety reasons.It will remain to be seen what impact this will have on co-working environments
- neighbourhood shopping centres with a curated offering attracting locals who want to support their local businesses
- a shift of focus by the operators of local tourist attractions to meet the needs of domestic travellers, rather than international visitors
- increased demand for warehousing and logistics-based assets to allow for prompt delivery
- a continuation of health and well-being based development, bringing together all aspects of the health industry
- an increase in the use of parks and recreational areas
These trends will provide opportunities for development and redevelopment of property by private enterprise with the support of Government. Government has shown its agility in dealing with the current crisis. That same agility, and willingness to work with private enterprise to put in place mutually sustainable solutions, will help us pivot into what will hopefully be a very different, but improved, living and working environment for us all.
John Nicolas | Partner | gadens
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