COMMERCIAL REAL ESTATE REBOUNDS FROM PANDEMIC RECESSION BY MICHELE LERNER
T
he impact of the shocking spread of COVID-19 and accompanying economic shutdown beginning in March 2020 continues to reverberate through commercial real estate markets more than a year after it began. Virtual schooling, social distancing, and remote work changed lifestyles and habits—some of which are expected to continue for the long term.
While the pandemic’s impact was swift and deep, commercial developers and investors were well-positioned before the pandemic, which made them better able to handle the crisis, said William Pattison, head of the real estate research and strategy team within the risk, research, and analytics group of MetLife Investment Management in New York.
“It’s an interesting time for commercial real estate in New Jersey,” said Adrian Ponsen, an economist and director of analytics with the CoStar Group in Philadelphia. “Prior to the pandemic, the market was slow moving for most property types. Now there’s a big divergence depending on the region and property type.”
“Investors were better prepared than they were before the dot-com bust in the early 2000s and the 2008 financial crisis,” said Pattison. “The construction pipeline was already a little depressed because of the tariffs that raised the costs of materials and high labor costs, so the pipeline of projects was slow. Vacancy rates were low, and rents were
10 | NEW JERSEY REALTOR® | July/August 2021
