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N EW HAM PSH I R E B USI N ESS R EVI EW
REAL ESTATE & CONSTRUCTION
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N H B R.C O M
SPONSOR E D BY
What happens after Covid-19?
For commercial real estate, there are many outcomes that could happen NORTH COUNTRY
LAKES REGION
NASHUA REGION
One concern is that we fail to learn all this is not a one-off. There will be more the appropriate lessons from this. So we of these. With 7.5 billion people on the do not want to bounce back so quickly Earth, we are forcing Mother Nature to I am sitting in our 3,000-square-foot that we ignore the facts and fail to make the limits. Hopefully, there will be a vacoffice all by myself as I begin writing this all the changes needed. cine for Covid-19 soon, but we go through TOP ROW: BUSINESS TECH, ARCHITECTURE, ENGINEERING, HOSPITALS, BANKING, PERSONAL FINANCE, ENERGY column — that is social distancing. My son One guest on NPR, a professor of flu season every year. Every year we can SECOND ROW: FEATURE STORY AND JUMPS, IN BRIEF, FLOTSAM, LAW, OPINIONS, THE LATEST, ABOUT TOWN is working from home (my home) and, as “Homeland Security” at Boston UnivergetMORE the flu shots — some work and some THIRD ROW: REAL ESTATE + CONSTRUCTION, EDUCATION, HEALTHCARE, TOURISM, NEWS, CHARITABLE GIVING, ONLINE heFORTH has three computers going simultanesity,CALENDAR, stated that we have lost March and don’t. ROW: AREA GRAPHICS, another TOURISM choice, LAST WORD ously with team members in Europe, the April (and now maybe May and June …) This past winter, we had the choice of Middle East and throughout the U.S — it So, we (businesses) will lose two to three a “single” flu shot or a “triple” flu shot, is pretty hectic. months of revenues but will still have neither of which anticipated Covid-19. The I am taking part in a NH Business Re12 months of expenses. The longer the Covid virus includes the common cold. view webinar on April 30 to discuss the “stay-at-home” order lasts, the deeper Covid-19 has not mutated yet, but it likely effects of the virus on commercial real the hole we have to climb out of. will. It is unclear if we develop antibodies estate. I presume that is what readers are The virus was the trigger, the catalyst or not. So we have lots to learn. most interested in having me opine upon. which toppled the dominoes. It is beThe reopening of the economy will be First, it is too early to see when and how coming apparent that the economy was slow and deliberate. I spoke with a hotel this is going to resolve itself. It will not be pretty shaky before Covid-19 appeared owner who said they do not plan to open quick or soon. We are in recession, and it on our shores. back up until Labor Day (at the soonest). could be a long and deep one. The feds This is especially the case for lowerMany restaurants are trying to negotiate will continue to throw lots of dollars at income households and, ironically, big the Paycheck Protection Program regulathis — $2.7 trillion and counting as of this companies that rely on a global supply tions, which is very challenging without a writing. The banks will likely reduce their chain. timeline for opening up to the consumer. cost of funds (from the Fed), perhaps Globalization and globalism are both For commercial real estate, there are here to stay, but there will be some cormany outcomes that could, or may, hapto zero! The question is — where is the rections, and there needs to be, because pen, but it is too early to tell or forecast. bottom? BY BILL NORTON
The recovery could be a “V,” a “U” or a hockey stick. Whichever it is, retail will look different in a year or two. Local and regional warehousing may prosper, as we decide to dial back from “just in time” inventories. Manufacturing will move to more robots — they don’t get sick and can be run remotely! Will people move out of the big cities? Will “work from home” get real traction and, thus, demand for office space shrink? Will the hotel sector shrink — if so, what or how does one repurpose these properties (housing for the homeless)? As I said to my son and daughter, we will weather this event, but there are many who will not fare so well. We cannot lose track of them when we come out the other side. Be safe and be well. Bill Norton, president of Norton Asset Management and an honorary member of AIANH, is a Counselor of Real Estate (CRE) and a Facilities Management Administrator (FMA). He can be reached at wbn@ nortonnewengland.com.
