Conversations About CRE: #recalculate #calibrate

Over coffee, tea and zoom during the past few weeks, two professional colleagues, Susan Arrowsmith and Susan Lange Smith, and I have discussed the implications of COVID-19 on commercial real estate. We have considered various sectors including office, retail, multi-family, student housing, industrial and hospitality. While comparing notes we have developed some insights we consider worth sharing.

With more than 75 years (yikes!) of experience in asset management, risk management and strategic planning, we bring varied perspectives and details to our analyses. Let’s face it. Together. How to continue to move forward?

Assess Risk

Companies have already begun assessing risk relative to asset performance, employee safety, operations, technology, security, and tenant rigor – with a focus on resiliency and data. The challenge is how to pivot quickly and in an agile fashion. What are the comprehensive and critical items to address and what are the range of options? We confer and update our checklist daily. You probably do too.

Time feels elusive right now – sometimes moving slowly through quarantine and other times racing by at an incredible pace with news updates by the hour. Digesting and synthesizing information is half of the battle for owners, tenants and employees. Our initial observations:

 

Deploy Capital: Both Defensive and Opportunistic

How to shepherd capital is a paramount concern. There is a need to protect the core business while also being open and able to respond to potential acquisition and disposition opportunities. Consider the full range – from defensive resource management to maximization of economic interest. We all need to be prepared to move quickly, once the course of action has been decided. So, what does that mean? It means actively engaging in risk management and the conveyance of a clear message to employee shareholders and ownership shareholders.  Everyone has a stake in an organization’s go-forward plans and it is important to manage expectations.

 

Remain Calm, Carry On and Eat Chocolate

Our best advice at this juncture is the foregoing. It is a critical time for action and wellness, both in the workplace and at home. Straighten up that new home office, wash your pj’s, protect your employees and your investments, and let us help you through these times; which while unprecedented, can and must be managed, thoughtfully, methodically, sensitively and without delay. We have seen and lived through similar situations, albeit a on smaller scale. That experience should help inform us as we all move forward.

Our budding collaboration plans to offer additional insights as circumstances warrant.  Should you wish additional information from any one or all of us, please feel free to reach out in any format you prefer.  As a team or individually, we want to continue and expand the conversation.  We look forward to hearing from you. Be well, friends.

 

Susan, Susan and Deb

#staysafe

From our “Conversations About CRE” Series … an ongoing consideration of all things CRE with colleagues passionate about what’s happening now, and how we can help each other through this!

 

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Upcoming Topics

Do you have topics you’d like us to address? Please share them with us.

 

About Us

The authors of this article have been employed by the following in their tour of corporate CRE: Smithy Braedon, The Oliver Carr Company, Real Estate Recovery, The Kaempfer Company, Lowe Enterprises, AON, Marsh & McLennan, Trammell Crow Company, CBRE, Cushman and Wakefield and WeWork. Links to more detailed info about us are presented below.

 

Contact Info and Links

Susan Arrowsmith s susan.arrowsmith@assetstrategies.us s 720.582.8262 s Boulder, CO

Susan Lange Smith s susan@Beaconrisksolutionsgroup.com s 202.669.6916 s Washington, DC

Deborah Bartlett s deborah.bartlett99@gmail.com s 240.354.6000 s Salt Lake City, UT