Chicago CRE Professionals Are Adapting To The Coronavirus Crisis, And Keeping The Deals Flowing
The onset of the COVID-19 crisis hasn’t brought much change to the workdays of some commercial real estate professionals. Chicago-based Cushman & Wakefield Managing Director Susan Tjarksen and her team were already conducting a lot of business remotely, so over the past couple of weeks as the company advised its employees to take more precautions, and eventually asked all to work from home if possible, they were ready.
The six-person team, which raises debt and equity for multifamily deals, holds what they call “15 at 15” every day, a 15-minute conversation at 9:15 a.m. to discuss the latest developments in upcoming transactions. C&W uses a full suite of technical tools, including Zoom videoconferencing, that make online group chats easy, and participants can quickly locate needed documents through SharePoint, an office support software program.
“It’s been business as usual, as I wasn’t in the office every day anyway, and everybody on my team can get the work done they need to get done,” Tjarksen said.
The adjustments may even bring permanent change to how companies operate.
“We’re about to find out how many meetings in the past could have been done just through email,” she said.
Some change is inevitable and adjusting to our new reality frequently means family and work lives now blend.
His brokerage firm began preparing to alter its professional operations about two weeks ago, and made the shift in the middle of last week. The company employs a number of independent contractors who typically give prospective renters in-person tours of luxury units, but now have the option to offer online video apartment tours instead. The shift came just in time, Galvin said.
“We’re finding that people are starting to search for apartments by typing into Google, ‘can I find an apartment during the coronavirus crisis?’”
Galvin’s team put together comprehensive video tours, ones that virtually walk prospects through every portion of buildings and apartments, including points of entry, lobbies, hallways and other spaces.
“We made it so someone could get a real feel for what it’s like being in an apartment building without actually being there,” he said.
A new marketing effort lets prospective renters know about their options, and makes clear if they do prefer an in-person tour, the agents, who can also choose to do video-only tours, practice social distancing suggested by federal guidelines. That includes greetings without handshakes, maintaining 6 feet of separation, and no touching of doorknobs or other surfaces.
Both Galvin and Tjarksen said deals continue to flow.
Tjarksen’s team has five potential deals on the table, and so far, three are proceeding as planned, she said, and on the remaining two, the clients want Tjarksen to check back in a couple of days before proceeding. But she has not heard any panic, and attributes that steadiness to the market’s underlying strengths.
“I have not had any active client who has said, ‘oh, my god, call me in a month.’ The fundamentals aren’t any different, particularly in multifamily, because people still need a place to live.”
It isn’t as if this transition has no rough patches, she added. The canceling of classes for school-age children, among the many other disruptions to ordinary life, has left many scrambling to arrange child care or care for elderly parents, alongside setting up the technology needed to work from home, and conversation about these struggles still takes up a big chunk of time on any call.
“The first 10 minutes are not about the business aspects, it’s about how do we get all this organized, and test it to make sure it’s working,” Tjarksen said.
Working from home will eventually have other drawbacks, she added
“What I will miss, if this goes on for a longer period of time, is the water cooler talk. Those a-ha moments that happen only when you’re at the office.”
The challenge is that however efficiently her team now works online, homebound deal-makers won’t come into contact with colleagues from different sectors, such as office or retail, which are frequently important components of multifamily projects.
“It’s that broader reach across disciplines that creates a-ha moments,” Tjarksen said.
That’s one reason she ultimately strikes a cautionary note, especially as most deals began before the crisis proceed.
“I don’t know if now is the time to launch a new deal. This is going to be a transition, so let’s all keep as cool as we can.”
Galvin and other brokers still worry the city or state will shut down all activity except essential services, which would likely prevent move-ins. His team is contacting people who already have signed leases to see if they could advance their move-in dates.
“I believe the sooner we can get people moved into units, the better,” he said.
Galvin is also recommending to apartment owners that they allow renters month-to-month extensions if they have a lease expiring during the crisis, in addition to holding apartments open for those who can’t move into their new places.
“I truly believe empathy will go a long way in this crisis,” he said.