As the virus spread from Asia across all our markets, most of us thought we would emerge on the other side by the summer. Now we face a prospect that there may be no semblance of normality until next autumn.
In the meantime, we learned to re-evaluate and redefine how we work, travel, interact with each other, raise children and rest. We realise that some of the changes are permanent and there is no going back. We are beginning to embrace with caution what some management gurus call the ‘Never Normal’.
Macdonald & Company act for real estate investors and developers globally and because real estate is a long-term game we all look well into the future. While there is a relative degree of paralysis now with retailers and other occupiers struggling to pay rent, this is really just a start of the seismic shift in how and where we work and live.
Head Hunters are a very accurate barometer of market sentiment; we talk to everyone. Based on the roles we are working on, we can predict our client’s strategy and direction of travel. We analyse our data in great detail and are hyperaware of what’s going on.Peter Moore, CEO
Real Estate in Review
Head Hunters have a unique and insightful view of the market. We talk to everyone; the employees, the developers, the corporate occupiers, the investors, and the advisors. We learn from everyone too, and our clients typically express their honest perspectives to us.
Head Hunters are also a very accurate barometer of market sentiment.
We are busy when confidence is high, quiet when confidence is low. We know which sectors are hot and which are not. Based on the roles we are working on we can predict our client’s strategy and direction of travel. We analyse our data in great detail and are hyperaware of what’s going on. I do have clients who believe that real estate occupational habits will revert to where they were last year.
I can be opinionated... but here are my thoughts and predictions going forward:
• The is no crisis in real estate, the industry is agile and long-term focused.
• The way we work has changed forever.
• Occupiers will certainly occupy less space as leases expire.
• Lease terms are likely to be shorter, with the exception of where large fit-out costs are incurred.
• The demand for anything but Grade A space will shrink as more staff work flexibly and we move to a hub-and-spoke workspace strategy. Expensive CBD locations will be high touch smaller collaboration space. Will this be the renaissance of market towns and decentralise working?
• Volume Residential developers will struggle to sell apartments with no shared communal workspace on site and communal living elements that will drive value.
• Wage inflation in the sector will diminish in return for flexible working.
Hope for the New Year
I, like most people, want to go back to an office environment. I miss my colleagues and I miss the dynamic, stimulating, motivating office setting.
I will certainly work from home more often. However, as I say to all my team globally with alarming regularity, the only thing people can’t write an algorithm for is the unique dynamic of the personal, close-proximity co-working.
People are tribal animals and as such need to be around each other to gestate, cross-fertilize and implement ideas. The simple earwigging of a project a colleague is working on, an impromptu brainstorm in the corridor, that informal conversation by the coffee machine allows for the magic to happen as new ideas, actions and solutions emerge effortlessly and abundantly.
Have a restful and safe end of the year and a great start into a (much better) 2021.
A Christmas Note
Instead of Christmas cards this year, we'll be donating to one of our selected charities, ELIFAR.
Every Life is For a Reason is a small charity which helps to improve the lives of children and young adults with severe learning difficulty and associated physical disability.
Donations help provide grants for a variety of items including electronic wheelchairs, specialised seating, eating aids, special beds and trikes, hoists, communication devices, sensory equipment and specialist holidays.
Help us share some joy this Christmas by donating through Virgin Money Giving.