Commercial real estate companies say the economy needs a specific shot in the arm to recover in 2021.
“The most important stimulus tool(s) are the vaccines that are being deployed,” said CBRE in its Q4 Marketview report.
“They will not prevent a difficult winter but should allow for some normalization of activity by the mid-Q2 2021,” it said.
With the travel and hospitality industries likely to operate below their potential, technology and manufacturing should see a quicker path to recovery, it said.
Last year began with the November elections anticipated to be the economic unknown.
Then came the pandemic and the shutdowns starting in March.
Office and retail markets suffered as safety protocols kept workers and customers away from group settings.
The industrial and warehouse market geared up to meet the demands of e-commerce and distribution companies.
People at home ordered food and household items and invested in home improvement supplies.
The COVID-19 shots are expected to help the office market, which saw tenants send home their workforces during the pandemic.
“There is a cautious optimism that with the COVID-19 vaccine rollout in effect, comfort levels with returning to the office will increase,” said JLL in its Q4 2020 Office Insight.
Avison Young stated that “2020 was a year like no other.”
It expects 2021 to be different.
“The fear that personified the beginning of the current pandemic continues to fade and with a contentious election cycle behind us and COVID-19 vaccine distribution in front of us, attention can now turn to promoting job growth and reversing the occupancy losses sustained during 2020,” it said.
On June 8, the National Bureau of Economic Research announced that the 128-month expansion ended in February 2020.
It was the longest economic expansion in the U.S. dating back to 1854.
Gross domestic product – the value of goods and services produced in the U.S. – fell in the first two quarters of 2020 and rebounded in the third and fourth. The bureau has not declared the recession has ended.
NAI Hallmark said in its Q4 2020 Market Report that retail demand “may have the opportunity to pick back up again once a vaccine is also made widely available.”
Franklin Street Managing Director Carrie Smith expects a return to strength in the retail sector.
“At the start of the pandemic, we were all making our way through uncharted territory hour by hour. Most assumed there would be large-scale fallout similar, or worse, than what we saw in the last recession,” she said.
That wasn’t the case.
“Once we got around the first lockdown, deal flow started to pick back up again.”
Smith said business has been steadily picking up since the summer.
“Going into this year, we’re predicting a robust 2021 with pipelines showing signs of deal flow very close to pre-pandemic 2020 levels,” she said.