With some commercial real estate transactions stalled, companies are starting to get creative.
Gary Albrecht, senior associate for Colliers International West Michigan and the team lead at its Grand Rapids office, said the firm is working on creative ways to show more of its space while much of the state shelters in place.
“For example, we have had some in our office use a Matterport to do walk-throughs of suites,” he said. “Think of what it looks like with residential listings. However, with some of our suites that is difficult to do because of the size and layout of them. Recently, we have had a professional photographer taking live videos and walking through suites. We are just finishing those up and will be pushing them out via social media and providing a link to YouTube where you can literally walk through each suite with live video that is tied to music.”
Jon Potvin, managing director at Colliers International West Michigan, said the firm has been able to do tours in specialty groups such as office and industrial buildings. Since most of the retail establishments are closed, Potvin said showings have been challenging.
“Retail has been hurt the most in the short term and likely will be hurt in the long term, but offices and industrial are still able to function slightly because some of their operations are open because they are deemed essential,” he said.
Although Colliers has added a Matterport to do walk-throughs of suites, Potvin said he fears that the stay-home order may lengthen the transaction process in the coming months. Potvin said it usually takes six months, sometimes longer, for a transaction to be completed because there are numerous factors to consider such as location, budget and space specifications.
“We are concerned in the short term because things don’t happen in the commercial real estate world nearly as quickly as they do in the residential real estate world,” he said. “Our transactions in the short term take 60 to 90 days, and that is a pretty quick turnaround for a deal to happen. Most of our deals take four to six months — sometimes a year — to go from start to finish. When you close things down like our state has for basically much of the month of March, all of April and at least half or more of May, these (orders) are naturally going to have some extreme impact on our business and the economy. Not just for the next month or two, but really for the next six to nine months, because that is the ebb and flow of how long transactions take in the commercial real estate world.”
Potvin said the first and fourth quarters are generally the busiest time periods in the commercial real estate market for Colliers as they are working with corporations that are adjusting their budgets.
Mary Anne Wisinski-Rosely, partner and office specialist for NAI Wisinski of West Michigan, said the firm hasn’t been able to do a lot of showings, only to clients that have been deemed essential businesses such as medical providers.
As different economic sectors of Michigan start to open up, Albrecht said they will be showing spaces in different ways.
“For example, meeting clients at the building and allowing them to walk the suite without anyone else present,” he said. “Making sure to have the lights on and doors open prior to the client walking the space. Then having the follow-up outside of the suite or on a phone/Zoom call. Again, these are things that could start happening once we are able to go back to work.”
Wisinski-Rosely said she thinks there will be some changes as people make adjustments to the new normal, such as increasing the size of their space because of social distancing.
“It just depends on when their leases expire, what their timeframe is, how quickly they want to make changes,” she said. “There are a lot of unknowns. This has never happened before in our lifetime. Unfortunately, we are moving blind with some things.”