Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. A CEO’s Guide to Planning a Return to the Office

Nearly a year after the Covid-19 pandemic closed most offices, we’re beginning to see reasons for optimism. The population of vaccinated people is growing, and the number of new Covid cases is declining from winter peaks. By mid-summer, a good portion of the working-age population should be vaccinated.

Because of such hopeful signs, CEOs at companies that remain all-remote are starting to think seriously about how and how much to bring their employees back to the office, and how to best answer questions about policies and timelines their boards will soon ask.

They realize that given all that has happened over the last year, more employees than ever before will work remotely, and for tasks that can be done more efficiently that way, investments in technology are necessary.

2. KBS: "Office Buildings Are Not Going Away"

There are a lot of questions and uncertainties about the future of the office market, but major office owner KBS has a simple answer: office buildings are not going away. The investor says that there will always be demand for office space, but with the rollout of the vaccine and an end in sight for the pandemic, it is bullish on office activity this year.

“Office buildings are not going away any time soon,” Giovanni Cordoves, Western regional president, tells GlobeSt.com. “As long as workers have a need for community and employers strive for ingenuity and collaboration, there will be a demand for office space. Additionally, as the COVID-19 vaccine becomes more widely available and people feel safe and comfortable, well-amenitized office properties will once again be in high demand.”

In Dallas, where KBS has a significant portfolio, early re-entry into the office space has been a good indicator of demand and the recovery of the office market.

3. COVID-19 No Longer Main Driver Of Office Demand

New demand for office space in core markets—measured by tenant tours of properties across the country—increased by 21%, or seven index points, in January 2021, a rate that’s on par with previous years but still smaller than it was pre-pandemic. But recent research by VTS shows that local COVID-19 caseloads are no longer the same demand driver they were.

The VTS Office Demand Index shows that office demand nationally was at 40 index points, as compared to 99 points year-over-year. By way of comparison, demand activity was at 100 in January 2018, a time that was relatively stable for office leasing.

Markets hit hard by COVID typically experienced a dramatic bottoming out in early spring 2020, but those cities with the highest increase in cases over the last three months actually saw demand increase the most. VTS posits that demand in local markets is more related to hyperlocal near- and long-term factors like job growth, vaccine rollout, and public health safety measures.

4. Consumer Demand Snaps Back. Factories Can’t Keep Up.

S.C. CLARK HODGIN FOR THE WALL STREET JOURNAL

U.S. manufacturers aced the shutdown of their factories and warehouses last spring in response to Covid-19. They’re botching the recovery.

After carrying out an orderly retreat from assembly lines as the pandemic arrived in the U.S., many manufacturers pulled out the playbook they followed in past recessions, cutting costs and preserving cash. That left them unprepared for the sharp rebound in consumer demand that began just weeks later and never let up.

Without restaurants to visit and trips to take, Americans bought out stocks of cars, appliances, furniture and power tools. Manufacturers have been trying to catch up ever since. Nearly a year since initial coronavirus lockdowns in the U.S., barbells, kitchen mixers, mattresses and webcams are still hard to find. A global shortage of semiconductors has forced many car makers to cut production in recent weeks.

5. Forecaster sees Georgia economy about to surge

The state’s economy will surge this spring as more people are vaccinated against COVID-19, though a sustained recovery won’t come until next year, according to a report Thursday from the Georgia State Economic Forecasting Center.

The pace of growth this quarter, which ends March 31, will be a solid 3.2%, said center director Rajeev Dhawan. But, from April through June, the economy will expand to a robust 8% — faster than any pre-pandemic growth,

That will be partly due to months of constrained behavior, Dhawan said at the center’s quarterly conference. “As people are more comfortable that there’s an end in sight, people will spend.”

Your success blesses others. I wish you a great a hugely impactful week!

Ken Ashley