{"id":1004403068,"date":"2020-03-25T10:25:52","date_gmt":"2020-03-25T18:25:52","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004403068"},"modified":"2020-03-26T08:07:49","modified_gmt":"2020-03-26T16:07:49","slug":"looking-beyond-covid-19","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/","title":{"rendered":"Looking Beyond COVID-19"},"content":{"rendered":"<p><img loading=\"lazy\" decoding=\"async\" data-attachment-id=\"1004391974\" data-permalink=\"https:\/\/www.commercialsearch.com\/news\/you-can-develop-on-formerly-federal-owned-land-maybe\/lew-photo\/\" data-orig-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2020\/02\/Lew-Photo.jpg\" data-orig-size=\"369,369\" data-comments-opened=\"0\" data-image-meta=\"{&quot;aperture&quot;:&quot;0&quot;,&quot;credit&quot;:&quot;&quot;,&quot;camera&quot;:&quot;&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;0&quot;,&quot;copyright&quot;:&quot;&quot;,&quot;focal_length&quot;:&quot;0&quot;,&quot;iso&quot;:&quot;0&quot;,&quot;shutter_speed&quot;:&quot;0&quot;,&quot;title&quot;:&quot;&quot;,&quot;orientation&quot;:&quot;0&quot;}\" data-image-title=\"Lew Photo\" data-image-description=\"\" data-image-caption=\"\" data-large-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2020\/02\/Lew-Photo.jpg?w=369\" class=\"alignright size-medium wp-image-1004391974\" src=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2020\/02\/Lew-Photo.jpg\" alt=\"\" width=\"300\" height=\"300\" srcset=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2020\/02\/Lew-Photo.jpg 369w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2020\/02\/Lew-Photo.jpg?resize=150,150 150w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2020\/02\/Lew-Photo.jpg?resize=300,300 300w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/>There\u2019s nothing funny about the pandemic sweeping much of the earth. But the Hahn Chair of Real Estate Finance at University of San Diego\u2019s School of Business managed to crack wise at the end of his recent list of predictions about the impact the Coronavirus will have on commercial and residential property.<\/p>\n<p>Noting that bargains will be had among office buildings, apartment communities, houses and the like put up for sale by panicked sellers, Norm Miller suggested that the most profitable among them will be funeral homes. But stay away, he warned potential investors: <em>\u201cThey are a dying business.\u201d<\/em><\/p>\n<hr>\n<p><strong>READ ALSO<\/strong>: <a href=\"https:\/\/www.commercialsearch.com\/news\/cpes-coronavirus-coverage\/\">CPE\u2019s Coronavirus Coverage<\/a><\/p>\n<hr>\n<p>Sure, it\u2019s an old joke. But Miller, who teaches the master&#8217;s in real estate program at USD, was more serious with the rest of his outlook, and rightly so. No one can predict with any degree of accuracy how long the virus will live in America and elsewhere before a vaccine is developed.<\/p>\n<p>But based on what he called \u201csome logic\u201d as well as past experience with SARS\u2014the severe acute respiratory syndrome, the contagious and sometimes fatal respiratory illness that first appeared in China in November 2002 but was contained and disappeared two years later\u2014Miller said the most immediate effects are already obvious.<\/p>\n<p>They include a significant interruption of supply chains across-the-board, significantly less travel and a fear of all crowded venues, possibly more government intervention at the state and federal levels, and overreactions in the capital markets impacting stocks and our estimation of wealth.<\/p>\n<p>Here\u2019s how he believes each of these will impact real estate, starting with the most obvious, some of which already are happening:<\/p>\n<ul>\n<li>Hotel occupancy will drop, as will conference center utilization. But tourist cities like Las Vegas and New Orleans will be impacted more than other cities.<\/li>\n<li>More and more airlines will cancel flights as travelers decide to stay home. And this will <em>\u201cimpact our ability to meet business commitments,\u201d<\/em> said Miller. If too many flights are jettisoned, it will cascade into even more meeting and event cancellations, and people will turn to video conferencing and other alternatives.<\/li>\n<li>Cancelled sporting events further dampen hotel occupancy. How long that will last will depend on when the virus peaks, Miller said. But <em>\u201cif history is any guide, the worst impacts will last no more than two quarters.\u201d<\/em><\/li>\n<li>Slowing or shuttered supply chains will interrupt production <em>\u201call over the world.\u201d<\/em> But while manufacturing will be delayed, <em>\u201cwe will make it up eventually,\u201d<\/em> Miller said. \u201c<em>It is not the percentage of parts that matters, but rather the inability to replace critical parts with domestic\/local suppliers that matters. The same is true for physical retail goods. These purchases will be delayed, and most will be made up. However, some business will be lost forever, like fitness centers, movie theaters and restaurants.\u201d<\/em><\/li>\n<li>Work will be disrupted if childcare centers and schools close for long periods. While a long closure is the <em>\u201cmost severe signal\u201d<\/em> that the virus could drive the U.S. economy into a recession, Miller does not think a recession is in the cards. Still, he warned that the economy <em>\u201ccould easily dip\u201d<\/em> into negative GDP for one quarter and\/or a very low GDP for all of this year.<\/li>\n<li>Lengthy school closures will \u201cseriously disrupt\u201d the office market as occupants switch to flexible work scheduling and more telecommuting, eventually resulting a larger, permanent home-based workforce. Home-based workers now account for 12-15 percent of all employees, but they could rise to 15-20 percent of the workforce over time, Miller ventured.<\/li>\n<li>The economy will be impacted negatively next year by a pullback in the stock market, delaying new and secondary stock issuances. And, in turn, investment and expansions will be delayed and new hiring will slow.<\/li>\n<li>A stock market decline also will hurt the high-end housing market, which is tied closely to overall wealth.<\/li>\n<li>Beyond hotels, the <em>\u201cnext most impacted property type\u201d<\/em> in the short term will be bulk port warehouses that deal with imports of construction materials, automobile parts and electronics, Miller advised. At the same time, though, local warehouses serving as the last mile in the overseas supply chain will benefit from a surge in e-commerce as people shop more online.<\/li>\n<li>Grocery shopping online, which most of the population has resisted, Miller said, will surge. And as a result, the one property type that has been considered e-commerce resistant\u2014the neighborhood shopping center anchored by grocery stores and pharmacies\u2014could finally go the way of most other retail properties. If he\u2019s just partly right on this prediction and a jump in online shopping is simply temporary, Miller said, some effects will still linger <em>\u201cforever.\u201d<\/em><\/li>\n<li>Construction will be delayed as builders and developers seek new replacement supplies and suppliers. <em>\u201cThis will hurt construction efficiency,\u201d<\/em> he also predicted. <em>\u201cStarts and stops do not allow for streamlined project management.\u201d<\/em><\/li>\n<li>Low interest rates will make refinancing and new acquisitions attractive, and the volatility of the stock market should steer more capital into real estate, supporting most values, especially in the multi-family market and the last-mile industrial market.<\/li>\n<li>Retail and office cap rates might witness wider spreads, but low Treasury rates will likely keep cap rates down.<\/li>\n<li>Unemployment uncertainty and business investment delays will cause some people to delay buying homes. But low mortgage rates will probably permit current owners who haven\u2019t been hit too hard by declines in their investment holdings to move up, thereby freeing up their houses to rookie buyers looking to get their foot on the first rung of the housing ladder.<\/li>\n<\/ul>\n<p>Miller also said the next several months will prove to be a good time to pick up property from panicky buyers. But stay away from those funeral homes.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>What&#8217;s happening next? Norm Miller, Hahn Chair of Real Estate Finance at University of San Diego\u2019s School of Business, weighs in.<\/p>\n","protected":false},"author":1154,"featured_media":1004391974,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21684],"tags":[48950],"class_list":["post-1004403068","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-viewpoint","tag-coronavirus"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.4 (Yoast SEO v24.6) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Looking Beyond COVID-19 - Commercial Property Executive<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Looking Beyond COVID-19\" \/>\n<meta property=\"og:description\" content=\"What&#039;s happening next? Norm Miller, Hahn Chair of Real Estate Finance at University of San Diego\u2019s School of Business, weighs in.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/\" \/>\n<meta property=\"og:site_name\" content=\"Commercial Property Executive\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/CPExecutive\" \/>\n<meta property=\"article:published_time\" content=\"2020-03-25T18:25:52+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2020-03-26T16:07:49+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2020\/02\/Lew-Photo.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"369\" \/>\n\t<meta property=\"og:image:height\" content=\"369\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Lew Sichelman\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@cpexecutive\" \/>\n<meta name=\"twitter:site\" content=\"@cpexecutive\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/\",\"url\":\"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/\",\"name\":\"Looking Beyond COVID-19 - Commercial Property Executive\",\"isPartOf\":{\"@id\":\"https:\/\/www.commercialsearch.com\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2020\/02\/Lew-Photo.jpg\",\"datePublished\":\"2020-03-25T18:25:52+00:00\",\"dateModified\":\"2020-03-26T16:07:49+00:00\",\"author\":{\"@id\":\"https:\/\/www.commercialsearch.com\/news\/#\/schema\/person\/c22692da604748ba40db71c72fb490bd\"},\"breadcrumb\":{\"@id\":\"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/#primaryimage\",\"url\":\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2020\/02\/Lew-Photo.jpg\",\"contentUrl\":\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2020\/02\/Lew-Photo.jpg\",\"width\":369,\"height\":369},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/www.commercialsearch.com\/news\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Looking Beyond COVID-19\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/#website\",\"url\":\"https:\/\/www.commercialsearch.com\/news\/\",\"name\":\"Commercial Property Executive\",\"description\":\"\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/www.commercialsearch.com\/news\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/#\/schema\/person\/c22692da604748ba40db71c72fb490bd\",\"name\":\"Lew Sichelman\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/4ed83099c2b476c20bc1f6e34929a040b2efa92743fc103a9a89907c4939f1a3?s=96&d=mm&r=g\",\"contentUrl\":\"https:\/\/secure.gravatar.com\/avatar\/4ed83099c2b476c20bc1f6e34929a040b2efa92743fc103a9a89907c4939f1a3?s=96&d=mm&r=g\",\"caption\":\"Lew Sichelman\"},\"description\":\"Lew Sichelman has been covering the housing and mortgage markets from his Washington, D.C., perch for more than 50 years\u2014first at the Washington Daily News and then at the Washington Star. In addition to providing his insights for MHN, he writes a weekly consumer column, \u201cThe Housing Scene,\u201d that is distributed to newspapers throughout the country by the Andrews McMeel syndicate. Over his varied career, he was written for National Mortgage News, National Mortgage Professional, Mortgage Banking magazine, Builder magazine and Sports Illustrated. And his work has been recognized with numerous awards from the National Association of Real Estate Editors, Mortgage Bankers Association and the National Association of Realtors.\",\"url\":\"https:\/\/www.commercialsearch.com\/news\/author\/lew-sichelman\/\"}]}<\/script>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"Looking Beyond COVID-19 - Commercial Property Executive","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/","og_locale":"en_US","og_type":"article","og_title":"Looking Beyond COVID-19","og_description":"What's happening next? Norm Miller, Hahn Chair of Real Estate Finance at University of San Diego\u2019s School of Business, weighs in.","og_url":"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/","og_site_name":"Commercial Property Executive","article_publisher":"https:\/\/www.facebook.com\/CPExecutive","article_published_time":"2020-03-25T18:25:52+00:00","article_modified_time":"2020-03-26T16:07:49+00:00","og_image":[{"width":369,"height":369,"url":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2020\/02\/Lew-Photo.jpg","type":"image\/jpeg"}],"author":"Lew Sichelman","twitter_card":"summary_large_image","twitter_creator":"@cpexecutive","twitter_site":"@cpexecutive","schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/","url":"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/","name":"Looking Beyond COVID-19 - Commercial Property Executive","isPartOf":{"@id":"https:\/\/www.commercialsearch.com\/news\/#website"},"primaryImageOfPage":{"@id":"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/#primaryimage"},"image":{"@id":"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/#primaryimage"},"thumbnailUrl":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2020\/02\/Lew-Photo.jpg","datePublished":"2020-03-25T18:25:52+00:00","dateModified":"2020-03-26T16:07:49+00:00","author":{"@id":"https:\/\/www.commercialsearch.com\/news\/#\/schema\/person\/c22692da604748ba40db71c72fb490bd"},"breadcrumb":{"@id":"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/#primaryimage","url":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2020\/02\/Lew-Photo.jpg","contentUrl":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2020\/02\/Lew-Photo.jpg","width":369,"height":369},{"@type":"BreadcrumbList","@id":"https:\/\/www.commercialsearch.com\/news\/looking-beyond-covid-19\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.commercialsearch.com\/news\/"},{"@type":"ListItem","position":2,"name":"Looking Beyond COVID-19"}]},{"@type":"WebSite","@id":"https:\/\/www.commercialsearch.com\/news\/#website","url":"https:\/\/www.commercialsearch.com\/news\/","name":"Commercial Property Executive","description":"","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.commercialsearch.com\/news\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/www.commercialsearch.com\/news\/#\/schema\/person\/c22692da604748ba40db71c72fb490bd","name":"Lew Sichelman","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.commercialsearch.com\/news\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/4ed83099c2b476c20bc1f6e34929a040b2efa92743fc103a9a89907c4939f1a3?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/4ed83099c2b476c20bc1f6e34929a040b2efa92743fc103a9a89907c4939f1a3?s=96&d=mm&r=g","caption":"Lew Sichelman"},"description":"Lew Sichelman has been covering the housing and mortgage markets from his Washington, D.C., perch for more than 50 years\u2014first at the Washington Daily News and then at the Washington Star. In addition to providing his insights for MHN, he writes a weekly consumer column, \u201cThe Housing Scene,\u201d that is distributed to newspapers throughout the country by the Andrews McMeel syndicate. Over his varied career, he was written for National Mortgage News, National Mortgage Professional, Mortgage Banking magazine, Builder magazine and Sports Illustrated. And his work has been recognized with numerous awards from the National Association of Real Estate Editors, Mortgage Bankers Association and the National Association of Realtors.","url":"https:\/\/www.commercialsearch.com\/news\/author\/lew-sichelman\/"}]}},"jetpack_featured_media_url":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2020\/02\/Lew-Photo.jpg","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/posts\/1004403068","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/users\/1154"}],"replies":[{"embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/comments?post=1004403068"}],"version-history":[{"count":3,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/posts\/1004403068\/revisions"}],"predecessor-version":[{"id":1004403467,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/posts\/1004403068\/revisions\/1004403467"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/media\/1004391974"}],"wp:attachment":[{"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/media?parent=1004403068"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/categories?post=1004403068"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/tags?post=1004403068"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}