Today at noon, the Covid-19 update from Governor Newsom and his team provided some insight into the scope of the businesses and activities beginning to open, from the state’s perspective (more information at https://www.coronavirus.ca.gov/ ). Governor Newsom stated that California is moving toward and into Stage 2 of a four - stage process to re-open the activities in this state . State guidelines for Stage 2 are expected to be delivered tomorrow, May 7th , during the noon conference. Last week the following slides were presented regarding Stage 2:
Note: For a more detailed “Update on California’s Pandemic Roadmap” , see https://www.gov.ca.gov/wp-content/uploads/2020/04/Update-on-California-Pandemic-Roadmap.pdf .
In Stage 2, San Diego County can set controls for opening of particular businesses and activities, including beaches, golf courses, parks, museums, and businesses (sector-by-sector). As for the viewpoint of the County, I suggest you review and stay current with the San Diego County Coronavirus website: https://www.sandiegocounty.gov/coronavirus.html , where you can find items such as the Safe Reopening Plan for businesses to use to prepare for opening. Further information is expected to be posted on May 8th .
While there are varying opinions on when a vaccine will be available and how long it will take to immunize the population, it has been widely recognized by those in the real estate industry and business in general that “business as usual will not be business as usual” for quite some time. The stay-at-home orders and the global attempts to “flatten the curve” have caused, and continue to cause, monumental economic chaos in the world economy.
In the current and foreseeable economic climate , there is tremendous uncertainty and risk as to future demand and therefore values in several sectors of commercial real estate today. During this time, will there be huge shifts in the needs and use of the current retail and/or office spaces? If so, could these shifts be only regional? Or, larger in scope? What are the underlying fundamentals related to these transformations? What uses will exist or be created to replace, convert, or repurpose these functionally obsolete buildings? Undoubtedly, values will drop. Your thoughts?