How to adapt to “The New Normal”: Taking stock of the changes across property sector

It is undeniable that we are all currently living in very strange times. In only a few months, every sector has changed dramatically. This especially includes the property sector — an industry that usually relies on face-to-face contact and personal relationships. Despite this, there are ways to develop within “The New Normal”. Flexibility is the key to learning how to thrive in our new world.

To better understand what your potential clients are looking for, you need to look at how your business is running. The first change to note will be whether or not you will be staying in the same offices as before, or even an office at all. Whilst it can be almost guaranteed that many companies will still see the value in keeping a bricks-and-mortar HQ, “The New Normal” has made everyone reconsider what they deem to be an essential place for work, and what that place needs in order to be most efficient.

What will be most important to your business going forwards? And is that drastically different to how you operated before?

Just like many businesses, potential commercial clients might be looking for smaller workspaces with the intention of having only a few staff members in at a time. Commercial property owners must assess how their assets with 100+ capacity can be modified to fit the needs of this changing time.

You also may need to reconsider the potential layouts of your offerings. Spaces designed around tightly-knit office cubicles, hot desks, and communal areas are likely on their way out. If these are the aspects you highlight when showing clients your portfolios, now is the time to rethink that strategy.

Now more than ever clients are looking for places with high-speed internet — this goes for both commercial clients and private tenants. Previously for tenants, high-speed internet was often a “nice to have”. In a world where many will begin working from home, top broadband speeds will be a necessity. Think about how high-speed internet will benefit your business and staff. If you have been joining the trend of video-viewings in lieu of in-person viewings, you will already know how reliant on internet the future of house-viewings now is.

In the 2020 budget, Chancellor Rishi Sunak announced £5bn of investment to be put towards connectivity, involving putting full-fibre and gigabit capable networks into every home and business during the next five years. Top-speed internet is clearly the priority of “The New Normal”.

Likewise, the ideal locations of your properties might change. A decrease in the requirement to commute might mean that your potential private tenants begin looking outside of the city for a place to call home. It might be worth taking a look at your portfolio to see which of your offerings are slightly further out of what you ordinarily would market as an easy “commutable distance”.

Which of your offerings are in beautiful areas or near coffee shops and social hubs? Do you have any further-out properties that are larger or nicer than something for the same price in the city? Cultivating these will be the key to success. That is not to say that your city properties are now worthless — many businesses will still see the benefits of being city-based, as will many private tenants who still commute or love the city lifestyle.

Flexibility extends beyond changing your portfolio and how your business runs day-to-day. Your contracts might also need a rethink. As businesses move away from bricks-and-mortar as a long term solution, consider taking on shorter-term contracts to fill your office spaces. By doing this, you will make sure you have a constant flow of tenants rather than relying on long-term tenants that may become few and far between.

This may require rethinking the clients you look for. Consider renting to small businesses and start-ups, or invest in turning your office spaces into co-working offices. If you stay flexible and embrace a steady stream of a variety of businesses, you may find it easier to fill your properties than if you rely on long-term contacts or your traditional clientele alone. As businesses rebuild, short-term bricks-and-mortar will be vital.

In short, it is of the upmost importance that you stay relevant in “The New Normal” and flexibility is the way to keep from being obsolete. Be willing to observe and lean into the new trends that will appear, whether those trends are new prime locations for properties, dynamic shifts in how commercial offices work, or an increased reliability on technology. By keeping your portfolio flexible and up-to-date, you will undeniably benefit from “The New Normal”.

Written by Israel Moskovitz,

“How to adapt to “The New Normal”: Taking stock of the changes across property sector” first appeared on my Medium profile.

New PDR for residential buildings offers an opportunity for freeholders to get the sector moving after Covid

The Government has announced a plan to expand Permitted Development Rights (PDR), allowing residential blocks to be expanded by up to two storeys without prior planning permission. With the PDR for residential buildings set to come into force in August, freeholders have a great opportunity to kickstart the property and construction sectors after coronavirus.

Post-Covid opportunities

Covid-19 has forced the entire sector to adapt rapidly to stem the spread of the virus. As I wrote recently, the residential sector is coming out of hibernation after three long months in hiatus. New ideas about how to market and sell properties will be needed. But, for freeholders, it is important to consider ways to take advantage of the opportunities already in play.

The new PDR allows residential apartment blocks over three storeys tall to be expanded by a further two storeys without planning permission. In effect, this gives freeholder the ability to significantly increase their existing assets without needing to go through lengthy and costly new planning applications.

The recent announcement by the Government offers freeholders a first tentative step into the brave new world of post-Covid. As we begin to emerge from lockdown, we must ensure that we maximise any and all opportunities.

Dual housing crisis

The housing shortage has existed in this country for years, with limited substantial effort being made to rectify it. In recent months, this crisis has been compounded by Covid-19. In order to respond to this dual housing crisis, there is a need to move quickly and efficiently to build affordable new houses. This sentiment was elucidated in a recent speech by the Prime Minister, who pointed to the housing sector’s role in getting the UK’s economy back on its feet.

The new PDR enables freeholders to do this by removing limits on block expansions, meaning more residential properties can be created quickly and easily. Likewise, by avoiding the need to build new developments, the PDR provides freeholders with a greener and more environmentally friendly way of increasing housing.

Considerations

When embarking on a new development, it is of course important to make certain considerations. Any redevelopments will inconvenience top floor leaseholders and tenants in the short term. Measures should be taken to prevent the disruption caused or, if disruption is unavoidable, alternative arrangements should be made available.

Furthermore, current top floor flats might lose some value in redevelopment. It is important to have these conversations with leaseholders and tenants early to explain the situation.

There are also strong benefits to this new announcement that will help both freeholders and leaseholders. Old roofs will be fixed with no cost to the leaseholders and lifts replaced. Likewise, construction work will provide freeholders the opportunity to carry out other important maintenance work.

Conclusion

Of course, this new PDR only offers us with a first glimpse into the post-Covid property sector. But it is increasingly clear the Government intends to stimulate the economy through construction. While freeholders must continue to search for new and innovative ways to adapt to the new normal, the PDR also offers a promising first step as we move out of lockdown.

Written by Israel Moskovitz,

“New PDR for residential buildings offers an opportunity for freeholders to get the sector moving after Covid” first appeared on my Medium profile.