September 3, 2020 – From new cleaning regimens to increased property tours to rent collections that exceed 90 percent, the commercial real estate sector is easing into a new and reasonable version of normal.
During a recent Baltimore Business Journal real estate webinar, Sean Doordan, Senior Vice President, Leasing & Acquisitions at St. John Properties; Jim Lighthizer, Principal and Managing Partner at Chesapeake Real Estate Group and President of NAIOP Maryland; and Kristen Schrader, Business Development Manager at Harkins Builders discussed how the sector is recovering in the midst of the pandemic.
“Our team has implemented a range of new protocols to address the safety concerns of our clients operating in multi-story office buildings, with highlights including additional day porters, improved HVAC filters and directional signage that helps control the flow of people,” Doordan said.
“In the early stages of the pandemic, we witnessed extreme creativity and resiliency among our clients in the ways they found to remain operational and now, by observing the parking fields at our buildings, we believe a sense of normalcy is beginning to return,” Doordan added. “This is also reflected in the volume of our showings which, for June and July, were on par with activity in previous years.”
Those efforts to establish a new normal are fostering stability, even optimism, in CRE.
“Although behavior remains frozen in certain sectors of the real estate industry, we detect little to no distress among landlords and tenants, and owners of commercial real estate are doing whatever it takes to keep their tenants happy,” Lighthizer stated. “Everyone remains cautiously optimistic about the short- and long-term prospects and, from speaking to my colleagues nationally, industrial tenants are paying their rents in the high 90 percentile, office in the low 90 percentage range, with retail hovering around 70%. And, these figures continue to rise across the board as the economy strengthens. Everyone feels extremely positive about the Baltimore-Washington, D.C. region, with the challenge consisting of the lack of developable land to build industrial space.”
Schrader agreed that the volume of business has ticked up considerably of late. She added there has been little to no slowdown in the industrial, laboratory and self-storage sectors.
“Everyone, by and large, has made the best of things and we are anticipating an active 2021,” Schrader said.