0 Even After Your Office Reopens, You May Not Be Going Back

By Paul Singer | WGBH | May 4, 2020

Whenever non-essential offices reopen, here’s the first thing to remember: About two-thirds of us probably won’t be going back in. At least not for a while.

Gov. Charlie Baker has assembled a team to begin talking about reopening the economy, and of course everybody is anxious to get back to work. But it turns out that reopening the economy probably means only reopening offices to a very limited stream of workers for the foreseeable future.

For most offices, “the target occupancy is probably going to be no more than 30 percent,” said Arlyn Voglemann in the Boston office of the global design firm Gensler. “And people will achieve that in many different ways — who knows how long it will last.”

Gensler is working with building owners and tenants around the region to figure out the best way for people to return to work. And for many people, the best way to return may be not to return just yet.

The whole goal is keeping your distance. And while renovating or redesigning office spaces is a longer term project, in the short term, existing office space is likely to be used very differently, Vogelmann said. She cited conference rooms as an example.

“If a conference room has six or fewer seats, you’ll only have one person in there,” she said. “If it’s larger than that, you can have a couple of people in there, but no more than 10 occupants in any space at one time.”

Staff may be switched to shifts so all the desks in an office are not filled at the same time. And people are not going to be sharing keyboards, telephones or other technology for a while, Vogelmann said. Even if people are working in shifts, they are very unlikely to be sharing desk space.

“If you’re phasing your work approach, and you’re only going to come in on Mondays, Wednesdays and Fridays, you don’t want Bobby sitting at your desk Tuesdays and Thursdays,” said Patrick Schmidt, principal and VP at Avison Young, a commercial real estate firm. “You’re not going to trust whoever your cleaning person is, no matter what the protocols are, that they’ve properly sanitized the workstation. So everyone’s going to want their own spot.”

Peter Conway of the real estate firm Lincoln Property Company puts it this way: “Now the idea of shared is so toxic — I don’t know if it’s the best word to say it — but shared almost equals risk in a lot of people’s eyes.”

Conway said this may be a serious problem for WeWork and similar co-working companies that have seen huge growth in the Boston market over the past few years. These companies rent space in bulk from office buildings and then convert it into smaller spaces that offer tenants more flexibility. This allows a small company — or a small unit of a big company — to sign a short-term lease just for a desk or a room and share the kitchen and conference rooms with other tenants.

Shared workspaces have gone from basically nothing to 2.8 million square feet of office space in Boston over the past decade, according to research by Colliers International, a real estate services firm. Aaron Jodka, Colliers’ research director, said the profit margin for many co-working operators is based on reducing the square footage allocated to each worker in the space or renting each desk multiple times under the theory that workers will not all be in the office at the same time. But with concerns about infection now at the forefront, “the idea of packing in as many people as you can is not safe,” he said.

But Tim Rowe, the founder of CIC, which operates several shared office spaces in the Boston area, said he thinks coronavirus is not a threat to shared offices. In fact, he said, it’s the opposite. He thinks the success of the massive “work-from-home” experiment of the past few months will increase demand for shared office spaces in the near future.

After a few months of having most employees work from home, Rowe said, “companies will say, ‘Gee, instead of having 100 people in a traditional office, I’m going to have a shared office and I’ll have 10 to 20 people that come in. Everyone else will work at home.'”

For those who do return to the office, it is going to be a very different experience.

Rowe says CIC is taking numerous steps to ensure the safety of their offices when they reopen, including asking everyone to check their temperature and confirm they do not have symptoms before they come to work. They are also going hands-free where possible.

“We’re converting our buildings to be touchless.” Rowe said. “We don’t think touch is a major vector, but we know that people are concerned about it and we’re not sure. So why not do that? So that means that we’ve found a way for every single thing, you know, you need to do in the office to be something you don’t have to touch with your hand. “

That means everything from touchless faucets to doors that can be opened with your foot to handing out a little wands that can be used to push elevator buttons.

Every conversation about the future of office space seems to return to the question of the elevator. Jim Roosevelt of the law firm Verill helped the Pioneer Institute assemble a “return to office” checklist for employers and building managers, and the elevator is high on that checklist.

“You can’t really socially distance more than a couple of people in an elevator,” Roosevelt said. “I’m not even sure you can do a couple in most elevators; in some elevators you’ve gotta do one. Even before they get in the elevator, there is the question of, ‘is it safe to have lots of people touching the elevator buttons?'”

That means there is likely to be some kind of traffic control in the elevator lobby, like a security guard limiting riders, making sure everyone is wearing a mask and creating safely-distanced waiting lines at busy times.

But the best traffic control strategy is to just work from home.

Nevertheless, even with concerns about contagion and the inconvenience of waiting on an elevator queue, people are itching to return to an office environment, said Wil Catlin, managing director of Boston Realty Advisors. What has been lost in the work-from-home experiment, Catlin said, has been “the organic hand-off of information that occurs from person to person, department to department, because they’re co-habitating, coexisting underneath one roof in one office.” When employees are scattered, he added, “everything is scripted. Everything. You’ve got to schedule a Zoom call. You’ve got to text. You can’t just like walk down the hall and say, ‘Hey, I’ve got a question about this.'”

That’s why Vogelmann says one of the long-term effects of the pandemic may be a move to more collaborative workspaces in office suites, and fewer closed doors.

“I used to go into my office five days a week,” Vogelmann said. “Let’s just say I’m going to shift to two or three days a week and I’m going to work from home for the remainder of that time. I’m going to do more kind of individual work from home or stuff that I don’t need my full team there for. And we’re going to prioritize our time when we’re in the office to get that group going.”

0 Thank you Jeremy Leventhal of Faros Properties for joining the BRA Morning Zoom

Jeremy Leventhal, co-founder of Faros Properties and real estate scion joined us from the Hamptons.  He talked about how the private markets are temporarily frozen and that physical due diligence is near impossible.  The conversation extended into discussing multifamily assets, office consolidation, and cowork facilities.

Jeremy was born and raised in Newton, MA.  He said that given the abundance of higher learning and teaching hospitals in Boston, it is one city that is typically more resilient to downturns.  Mr. Leventhal shared a story about his grandfather, founder of Beacon Capital, repeatedly going to a city official in Washington DC to purchase a parcel of land.  He was denied countless times, yet kept coming back to have the same conversation.  After years of persistence, he was finally sold the land for Jeremy’s grandfather to proceed with his development plans.  Lesson learned – Be respectful and never give up.

Jeremy concluded with a book recommendation – MBS: The Rise to Power of Mohammed bin Salman.

0 Tenants Returning to Boston Offices Will Find A Strange New World

By Dees Stribling | Bisnow | April 27, 2020

Most Boston commercial space is now empty, but the time is approaching when many or most workers return, perhaps in shifts or only a few days a week.

Property managers are already trying to sort out the transition, speakers on Bisnow’s health and safety in property management webinar Thursday said. The details of bringing people back into commercial space in an orderly and safe way aren’t clear. One thing is clear: It won’t be easy.

Most space in Downtown and in Cambridge is empty, with commercial occupancy below 5%, though occupancy is higher than that in a few pockets, such as life science space, Lincoln Property Co. Vice President of Property Management Scott Rickards said.

“We’re planning for re-occupancy at some point after May 4,” Rickards said. “Could be sooner, we hope. We’re fielding an increasing amount of questions every day from tenants about what they can expect.”

Personal responsibility is going to be critically important to making re-occupancy work, Rickards said.

“We all know people who go to work sick, and that’s what we really can’t have,” he said. “Every company has to be responsible for its employees, and every individual responsible for themselves.”

The focus now, EBI Consulting Director of Environmental Health & Safety Karla King said, is how company policies can evolve to address the future re-entry. Some companies have specific issues, such as those needing to deal with COVID-19 cases at their buildings, while others are simply trying to devise forward-looking planning.

“We’re working closely with some of our clients, evaluating current housekeeping and programs and getting an understanding of high-touch and common spaces,” King said.

In the case of a building with a suspected COVID-19 case, each instance is evaluated based on when it happened and how isolated the space is, King said. Then her company works with the client to identify or evaluate a cleaning company, looking closely at its cleaning products and protocols.

Even without a COVID-19 case, tenants who plan to return need to formulate detailed plans, King said.

“What PPE are people going to be bringing or wearing to the office, mandated by state or federal officials, or by their own choice?” she said. “Where are they going to dispose of their PPE?”

Boston Realty Advisors Managing Principal Wil Catlin, who moderated the webinar, asked whether some landlords will have stricter requirements regarding PPE than others.

“At some level, there needs to be baseline standards,” he said.

PPE use will vary according to the use of the space and how much common space there is, King said, adding that common areas and high-touch spaces are going to be the biggest areas of concern for property managers.

“That’s one thing to communicate to tenants: the importance of everyone controlling their space,” King said.

Property managers can’t be responsible for the cleanliness of every specific desk or other personal area, King said, since it is largely out of their control. Instead, they will be more concerned with common spaces, such as gyms, cafeterias, restrooms and reception areas.

Catlin also asked about security procedures in a post-pandemic environment, specifically how buildings will handle front desks and check-ins. Technology is a longer-term answer to security, Rickards said, and some Class-A buildings probably already have the tech in place to go touchless.

“There are some apps that work with security systems so that your phone has a unique identity, and you can walk into the building, and it knows your app,” Rickards said.

But most Boston real estate doesn’t have that kind of sophistication yet, he said. In many small lobbies, social distancing won’t even be possible.

“So there will be a lot of workarounds, and that’s going to extend the need for PPE,” Rickards said. “You’re going to need to have a mask on, and maybe gloves. Can we come up with a way to show an ID so that no one else touches it? It might be a rudimentary as the security guard doing all the writing. It’s going to be complicated.”

0 State of the Nonprofit World

One of the disproportionally impacted industries in Boston is the non-profit community.  From health services to education, advocacy and housing, furloughs and firings have skyrocketed, leaving only skeleton crews of management readying for a potential reopening with SBA loans and needed relaxation of distancing rules.  Not only are the providers affected, since they cannot deliver services traditionally, their respective constituencies are left to manage the best they can on their own in a tough economic environment.

Adding to the angst, spring is usually “fundraising season”, but with the inability to throw soirees, NPO’s small and large have been lamenting the loss of desperately needed funding.  Indeed, Northeast Arc’s Joann Simons recently noted the following about their capital raising:

“Due to current CDC social distancing recommendations we have made the difficult decision to cancel our 2020 Evening of Changing Lives Gala. The gala was budgeted to raise a minimum of $600,000 this year and we are now anticipating at least another $150,000 of unexpected expenses in response to the Covid-19 pandemic.”

In the education sector, which includes daily daycare for children & seniors, consultants assisting Boston Public Schools in the classroom and special education providers, the closed schools and buildings have completely halted their services, critical to a large swath of Greater Boston.  One bright spot was noted by WDHD TV (https://whdh.com/news/how-one-ma-school-is-creatively-teaching-special-education-students-during-covid-19/).  Bedford, Massachusetts’ Nashoba Learning Group has taken a page from the university world and embraced daily video support & learning online, enabling parents and caregivers to participate in supporting their families and loved ones with intellectual disabilities in home.

What does the future hold?  Even before Covid 19, we noted a wave of closures and mergers in the education and health services, such as The Home for Little Wanders acquisition of Wediko School in 2019.  Sadly, we suspect that many of the smaller privately funded NPO’s will close for good in 2020, and hopefully those services will be picked up, where possible, by the corporate size providers like ABCD, Eliot Community Services and Morgan Memorial Good Will, to name a few.

************************************

Christopher McMahon is a Managing Director at Boston Realty Advisors and heads the Non-profit Practice Group, supporting the missions of a wide variety of Boston’s NPO community leaders and organizations.  Mr. McMahon is a +20 year veteran of the Greater Boston brokerage industry.  He can be reached at cmcmahon@bradvisors.com and 617-721-6437.

0 COVID-19’s Impact on the Hotel Industry

Industry leaders share the realistic and profound impact of COVID19 on the hospitality industry. The principle challenge is clear – containment practices including closed borders, travel restrictions and social distancing have left an abrupt and indefinite bearing on demand for hotels.

Owners are making difficult decisions and given the circumstances are forced to take proactive measures. A resounding echo on the hospitality industry, the COVID19 crisis is already of greater impact than 9/11 and the financial crisis of 2009 – combined. Unlike anything the industry has seen before, the detriment from COVID19 is incomparable even to hotels that bore witness to the Great Depression.

  • Hotels have lost $13 billion in room revenue since this started
  • 8 of 10 hotel rooms in the US are vacant
  • Hotel industry is on pace to lose 5.3 mm jobs

Thank you AHLA for providing insight to the challenges the Hospitality Industry is facing during this time. Listen to what Industry Leaders have to say HERE.

0 Boston Town Hall with Economist Michael Klein: Coronavirus, The Stimulus Package and Economic Forecast

https://www.bigmarker.com/bisnow/BOSTON-TOWN-HALL-WITH-ECONOMIST-MICHAEL-KLEIN

The coronavirus has changed the way that properties are managed and secured. Many tenants don’t know what it will take to transition back into units or how to protect themselves once they’re back inside. Property managers have to reevaluate how to manage and operate properties now that there are new requirements for what it means to provide safe environments for tenants to live, work, play and transition into.

In response, leading property managers have altered daily practices, while also innovating management techniques to proactively protect tenants today and down the pipeline.

0 Thank you Ellen Yee for joining the BRA Morning Zoom

Thank you Ellen Yee from Boston Architectural College for joining the BRA Morning Zoom.  Key takeaways include.

– Ellen said that she was born and raised in Boston and can’t imagine living anywhere else – BOSTON STRONG.
– When it comes to managing an academic facility, she said that every day brings a new set of challenges – which keeps her on her toes.
– BAC established a COVID-19 Task Force that regularly meets to decide on how to best engage students and make decisions in the now and moving forward.
– Ms. Yee said that clear communication was key to their success over the last few weeks.
– Some of the academic transition to e-learning was simple. They are still trying to figure out how to virtually activate their Fabrication Lab.
– Ellen also revealed that they are trying to determine how to get McCormick Gallery online.