A few years ago I interviewed a designer who said that she wanted to work for our company but ultimately her goal was to be a ‘digital nomad’ and travel the world while working remotely. At the time I remember thinking that this would never work in our profession and now pretty much everyone is working remotely. Recent events have been an alarming wakeup call as to how much technology has freed us from traditional methods of getting things done. Many people are still thinking that at some point things will go back to ‘the way they were’ and offices will be re-populated. If history gives us any indication of future events, it’s hard to imagine that companies will rescind ‘work from home’ policies if the employee has been getting their work done efficiently from home for the better part of the year.
So what happens to all these commercial spaces once used for businesses, retail, restaurants and assembly spaces? Will people go to the movies in the same numbers if they have setup a theatre room in their house and new releases are now streaming direct to their living rooms? Data suggests that there is a divide based on age where younger generations are more likely to embrace technological solutions and older people are more resistant to change. That being said, we still have a lot of unused square footage to contemplate as our society moves forward.
Below are a few observations and strategies on how we can create the next generations of spaces that will serve us in the near future:
Hotel Room demand will be down as business travel decreases. This seems like an obvious one based on the data we are seeing from the Hospitality Industry. Developers should think about converting a portion of their hotel room inventory into apartments which would also utilize the amenities of the building (restaurants, fitness centers, etc..) as many new apartment buildings are including these amenities as minimum standards. Banquet spaces could also be used for co-working and lounge spaces to create a ‘resort like’ home for any resident.
Retail spaces will be needed less as people continue to migrate to online shopping. Instead of spaces for browsing, it might be helpful to look at retail spaces as smaller and more intimate social spaces for personal services which are needed as a result of all the ‘remote-ness’. Services such as tutoring, personal training, and nutrition planning have become essential wellness needs as people grapple with the anxiety of falling behind in a world that is more physically distanced. Also, social outings such as personal karaoke or intimate musical venues are more in demand than ever and could be lucrative as socially responsible ways to get out and not be thrust among huge crowds.
Residential Demand will continue to increase, especially in more suburban areas. So, if you can work from home now and don’t need to commute in to a big city 5 days a week (even the most conservative companies have adopted a hybrid schedule for those who only want to come in one or two days a week) why would you live in a high tax, high cost area? The suburbs have seen mass migration over the last year and that trend is likely to continue. Home prices are up more than 40% in areas surrounding major cities and the move is going to continue as long as high speed internet is available. If you can afford to work with a builder or buy some land at reasonable price, now might be the right time to invest in that second home or even a speculative deal that you can sell in 12 months.
As with many opportunities it pays to be ahead of the curve. These are just a few of the trends that are currently emerging so make sure you are investing your time and money into a sector that will still be around in 24 months.