How the Coronavirus is affecting commercial real estate in the Greater Philadelphia Tri-State Region from our team of retail specialists
An unprecedented crisis is facing our region and the globe.
Our brokerage teams are closely monitoring the rapidly evolving market trends throughout the Greater Philadelphia Tri-State region. Our retail strength is built upon years of experience supporting our clients through a multitude of cycles. We will keep you up to date on what we are seeing and continually update our insights to ensure you have the most relevant and practical advice you need to weather this crisis.
In the Market
Lease deals that were in progress appear to be still moving forward but those with tight opening deadlines could be pushed back. To be expected, we are seeing a slowdown in new activity as many retailers are taking a wait and see approach as most are dealing with closed stores and out of work employees - a temporary situation we hope. With the exception of businesses that have been deemed “essential” i.e. grocery, home improvement, gas stations, select big box stores and restaurants (offering take-out only), the majority of retailers are temporarily closed as shoppers must heed stay-at-home orders.
The shutdown of the commercial construction industry coupled with what will be a delay in the receipt of city, state and municipal approvals will most certainly lengthen the timelines for new store openings.
We anticipate that the new "normal" due diligence periods for recently executed lease and sale agreements will be extended due to the interruption of third-party services such as appraisals and inspections.
Online sales will help to mitigate some of the losses to omni-channel retailers. Since most are working from home, in non-business attire, with limited access to non-essential food stores and no access to gyms and entertainment centers, sales of baking, crafting, fitness equipment and leisure wear have increased.
Retailers have been reacting quickly to diversify and adapt their range of services - a practice that may serve them well longer term. Restaurants who had not offered online ordering, home delivery and curbside pickup may see demand for these services continue to be popular when the physical locations open back up. Service providers are taking their offerings virtual and gym classes are popping up on Zoom.
In Philadelphia, a COVID-19 Small Business Relief Fund has been established and we expect more resources as stimulus and relief packages work their way through Congress.
Every business is unique and no one prediction applies. Now it is more important than ever to stay connected, by sharing our knowledge we hope to help you best navigate your path through this market disruption.
Now is the ideal time to pick up the phone, call your favorite broker, talk and strategize. As a firm entering its 100th year locally, we have seen upheavals of the market before and have valuable guidance for repositioning for both tenants and landlords. In the coming days we plan to check in personally to hear your challenges and strategize on the solutions that will accelerate your success going forward.
We also want to make you aware of a new weekly webinar offered by Colliers U.S. Retail that will bring on experts to discuss and help better navigate this situation. Review our first call's slide deck and register for part 2 which will be held Wednesday April 1 at 11:30 EST.
From the Colliers Greater Philadelphia Retail Division be well, and be safe. It is our privilege to partner with you.
Call us. Let us know what you are seeing, and how we can continue to support your business.