Looking at the Pandemic's Impact on NYC Real Estate
New York City is one of the most expensive and competitive real estate markets in the world. Yet, the city was hard hit by the pandemic, resulting in long-term implications NYC real estate brokers, developers, and investors, are still trying to grapple with.
When the economic and health crisis hit, tens of thousands of New Yorkers fled all five of the city's boroughs in hopes of finding space and fresh air away from the busy, crowded streets. As a result, empty roads and parks were left unoccupied and vacant restaurants, bars, museums, and businesses left the once vibrant city silent.
For more than two decades, developers, investors, and real estate brokers had always presumed the city that never sleeps would never miss a beat. Now, thanks to the pandemic, New York City's real estate market is facing an uncertain revitalization that no one could have ever predicted.
Tackling the Office and Residential Markets
One of the most significant issues the city faces is that many office and residential spaces are available, with many more set to arrive over the next few years due to current development and construction underway. Many companies have downsized or moved to remote work while city residents have relocated to the suburbs throughout New York or across the Hudson River to New Jersey. With these departures came a continual decline in tax revenue, forcing cutbacks in services and causing the city's quality of life to decrease, leading to more departures.
So, the most critical question is: How does NYC stop the vacancy rates from rising and bring back former New Yorkers and businesses to occupy these spaces?
The key to bringing the city back is NYC's devotion above all to economic growth and real-estate development. Through new growth, new tax revenue is produced, allowing the city to provide services to its citizens, making it an attractive place to live, work, and gather, while increasing demand for growth and development. Without new growth, the once cultural, social, and economic hub of the world could disappear very quickly.
Many experts believe that the NYC real estate market and the city itself will eventually bounce back–as it always has during times like the Great Recession, 9/11, and the fiscal crisis of the 1970s.
Developers and landlords moving forward will need to evaluate their buildings to develop and design them for the post-pandemic world. Investing in technology and creating open spaces to combat the spread of infectious diseases will be a crucial first step towards moving in the right direction. Although not every skyscraper in the city can be retrofitted to have expansive corridors and wider spaces, since a vast majority of the buildings date back 50 or even 100 years, touchless elevators can be implemented, and HVAC systems fitted with UV light can be added to circulate clean air.
Now that the vaccine to fight the virus is finally here, developers, investors, and real estate brokers are eagerly anticipating a brighter 2021. New Yorkers are slowly trickling back into offices and residential spaces that have been revamped since the pandemic started. However, developers should not lose sight of the growing confidence that a big surge back into the city is on the horizon. They must continue to build and develop safe, spacious, and technology first infrastructure plans to combat a future pandemic-like climate.
DBe Can Reconfigure Your Office and Residential Spaces for the Future
If you're looking to reconfigure the square footage you have, the experts at DBe, a full-service General Contracting, Management, and Advisory firm, are here to help. Contact us today to hear how we can safely and securely transform your office and residential spaces to bring back tenants and companies.