COVID-19 could restructure Georgia’s commercial real estate, industry
Atlanta skyline
(The Center Square) – The COVID-19 pandemic could revamp Georgia’s commercial real estate and intermodal industry, analysts said Tuesday.
With more people working from home and relying on e-commerce, Georgia’s commercial landscape could include more warehouses, more cargo vehicles and fewer office buildings, a group of panelists told attendees of a Georgia Public Policy Foundation’s virtual forum.
“I do think that the real crisis is going to be the commercial real estate one. Like the retail apocalypse, it’s going to continue, ” said Joel Kotkin, a presidential fellow in Urban Futures at Chapman University. “The idea of the big, open office with everybody on top of each other, I think that’s not going to be popular in the near future.”
Nearly 70 percent of employers surveyed by the Atlanta Regional Commission, said more of their employees will work from home in the future, and 23 percent said more will work from home on a full-time basis, according to report released last week.
One in five of the 100 companies surveyed said they may reduce the physical size of their workplaces as a result.
Most employees said they wanted to return to work in the commercial office, but only for half of the work week.
Kotkin also believes the shift in telecommuting will cause an increase in the migration from metropolitan areas to more suburban areas.
“What I am seeing is people saying, ‘Well, if I’m going to be working from home all of this time, I would like a space that’s more suited to how I’m working now,’ ” he said.
Social distancing trends also could have a huge effect on Georgia’s intermodal industry. The state is home to the busiest airport and one of the largest seaports in the nation.
“Thinking about the Port of Savannah and the tremendous growth anticipated there with freight goods and deliveries throughout this half of the United States, I mean that’s gonna be huge,” said Tom Hutchinson, transportation director for construction engineering company HNTB Corporation.
By the end of June, the Port of Savannah had been recognized as the national hub for containerized agricultural goods, according to the Port Technology International. Tonnage increased by a record 2 percent in fiscal year 2020.
An increase in e-commerce also could lead to more road congestion as more long-haul and delivery vehicles take the streets, Hutchinson said.
That need could also change the facade of commercial areas in the state, said T. Dallas Smith, commercial real estate pioneer and member of the Georgians First Commission.
Some cities already have been resistant to the esthetics of warehouses and distribution centers, he said.
“I’m a big believer that the dirt will tell you what it needs to be,” Smith said. “And if you’re near the busiest airport on the globe, on the planet, you need to think about logistics, as a core.”
