The coronavirus pandemic has prompted global discussions about how people will shop, work and mingle in the future. Though still only a few months into the crisis, some theories suggest that consumers will prefer e-commerce and working from home, for both health and quality-of-life reasons.

Others have suggested that trends that were popular before the pandemic will simply accelerate. When it comes to commercial real estate, you can’t get much more popular than mixed-use developments.

Though the pandemic has brought deal flow to nearly a complete halt, Lionstone Investments is focused on mixed-use developments as a part of its long-term investment strategy.

“On a long-term basis, we still believe in the mixed-use concept and the mixed-use principles,” Lionstone Investments Chief Operating Officer and Head of Portfolio Management Tom Paterson said during a Bisnow webinar June 4.

“We think, for a period of time, the level of density may become a little bit more moderate. The idea of the level of density, for example, in New York, is a lot, and the idea of sending people through concrete tunnels and metal tubes on trains to come into the city, it’s going to take some time to heal and recover,” Paterson said.

Paterson noted that the company owned a substantial amount of infill properties, located in both central business districts and nearby suburban areas.

“Some are in CBDs, or some are nearby and in urban infill type of locations, and we think that can still work, will still definitely work,” Paterson said.

Lionstone Investments CEO Jane Page said that knowledge workers in the millennial age group want places where they can live, work and play.

“They don’t want to just go to a stand-alone office building at the intersection of freeway and freeway. They really want to be where a community is, they want to be where there’s green space, they want to be where they can interact with people,” Page said. “We believe we’ve been on this path for several years, and I think it’s just now going to accelerate.”

Paterson said that the company has been tracking opportunities across the 17 markets that Lionstone invests in, and that of the deals that were in the market or under contract before March, only about half have closed.

“Those are typically the ones that might have had their debt already in place, commitments from lenders. They might have already heard nonrefundable earnest money from buyers, that they weren’t ready to walk away from that,” Paterson said. “The availability of financing has been a really big aspect of it.”

Despite the challenges, Lionstone sold a Dallas office building in April, which was continuing to perform, had good occupancy and was continuing to collect rent from tenants.

More broadly, for deals getting done, Paterson said he had seen price reductions ranging from 5% to 15%. The repricing of hotels and retail could see price reductions of potentially between 30% and 50%.

“We think that’s a short-term phenomenon rather than a long-term one, but it kind of shows you the depth and breadth of that spectrum of impact and value,” Paterson said.