Watch: Commercial Real Estate Practical Considerations for Your BusinessAugust 19, 2020
< Back to Full Restart Michigan Webinar Schedule
The experts at Plunkett Cooney shared with the Detroit Regional Chamber what changes and considerations will be at the forefront for businesses – especially in terms of commercial real estate and workforce management – as the global pandemic continues to unfold. In conversation with Darren Nichols, freelance journalist and contributing columnist for the Detroit Free Press, Plunkett Cooney panelists Douglas C. Bernstein, partner and business law department leader; Scott K. Lites, partner of the business transactions and planning practice group; and Sydney R. Puricelli, senior attorney of the labor and employment law practice group, discussed the business challenges and transformations driven by COVID-19.
The uncertainty created by the pandemic is taking a toll on business owners and those in commercial real estate. “Developers that are in the office building [business] are very concerned long-term what the effect is as people work more and more from home. There could be less of a demand for office space,” said Lites. Another key issue posed by the unknowns is security and the integrity of documents. Employers should seek solutions that ensure such security working in more virtual formats, both internally and externally with clients.
In terms of the accelerated dependence on technology, Puricelli noted the importance of maintaining continuity of communication, which though challenging, is feasible with the modern tools available. As businesses of all industries prioritize health and safety, some positions may become permanently remote, posing not just challenges for professional interactions, but also how tenants, landlords, and banks are able to support themselves and each other.
The long-term implications of these shifts will begin to show in how businesses use their spaces. COVID-19 has exposed unnecessary, duplicative roles in organizations, the permanent removal of which will decrease businesses’ physical footprints and need for office space, according to Lites. These effects extend further into the mergers and acquisitions landscape as buyers and franchiser-franchisee relationships are strained by the trepidation of an unpredictable market.
“It really is a function of how accessible capital will be,” said Bernstein. “What’s the appetite for taking on risk until it’s known what the new normal might look like? And until we get to a point where things are more stable and you’ve got a little bit of a track record, accessibility to capital from a traditional lender may be somewhat limited.”
In outlining how businesses can navigate these growing operational complexities, the panelists unanimously emphasized transparency and awareness.
“You really need to have some dedicated staff to COVID issues,” said Puricelli. “There needs to be expectations about how documents and workplace manuals and all of these things that are being put in place are going to change. You want to have somebody internally that is going to be monitoring all of the issues and making changes within your company that are going to be captured and communicated to everybody on your teams.”
It is essential to adapt to and face issues, not keep our heads in the sand. The sooner organizations start making predictions and preparing for the what-ifs the better. Businesses should be vigilant of unnecessary expenses and employees should strive to showcase and secure their value.
In closing, Lites said, “the people that will survive and thrive will be those that can transition their businesses from what they might have been to something new.”