Work-from-home trend could impact commercial real estate

Camana Bay
Dart is building new residential and office buildings at Camana Bay.

One obvious side-effect of the work-from-home movement is likely to be the demand for office space.

While innovations like hot-desking or shared conference facilities – which cater to businesses with no physical premises – may emerge, commercial landlords could find themselves in a difficult bargaining position.

Michael Binckes, a broker with Re/Max, believes it is too early to say definitively how that sector of the real-estate market will be impacted.

Not every business can operate effectively working remotely, and he believes social distancing requirements may see some requiring an increase of their workspace.

“Some businesses will try to save rent and work from home completely, and then you might see others that look to design offices with more of an open-plan environment,” he said.

Binckes and Kim Lund of Re/Max closed a deal to sell Elizabethan Square during the COVID-19 crisis

He believes more developers will look to mixed-use buildings that combine work and living spaces, but he cautions that uncertainty about the longevity of the pandemic and future regulations make predictions difficult.

“No-one really knows where this is going to go and it will be interesting to see what happens with these shared spaces,” Binckes said.

Related: Remote Island: A new era for working life?

Justin Howe, president of real estate asset management for Dart Enterprises, said there continued to be demand for commercial space at Camana Bay.

“Several tenants contracted prior to COVID-19 are currently progressing fit-outs, contributing to the economic impact of the local construction industry,” he said.

“Our tenants have been incredible over the past few months, taking the challenges and uncertainty in stride. We are encouraged by their continued commitment to Camana Bay, with some tenants even planning expansions into the new office building currently under construction.”

He said Dart continued to monitor trends related to work-from-home and social distancing regulations.

“We are fortunate to be able to take a long-term view on our commercial development strategy,” Howe said.

Construction work on a new office building, planned prior to COVID-19, is continuing at Camana Bay. Howe said Dart was making some changes, however, to better prepare for the post-COVID environment.

“Our design teams are definitely placing a greater emphasis on hygiene and sanitation,” he said.

“They have already progressed several adjustments to reduce the number of touchpoints, particularly in higher-traffic areas such as bathrooms, kitchens, lobbies and other common areas.”

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  1. We’re seeing this trend where I live in the UK now. Several of my neighbours already know they won’t be returning to their offices and will continue their employment from home indefinitely.

    However, there is an upside to this. With the internet, people can work-from-home anywhere so it might be that people in this situation could be persuaded to relocate to the Cayman Islands.

    This was what a good friend of mine considered before his untimely demise. His business was based in the USA but he had a condo on South Church Street where he’d stay for what amounted to working online holidays. The only thing stopping him from moving everything out here full-time and commuting back to the USA on the odd occasions that needed face-to-face interaction was immigration – they told him flat out he couldn’t do it. Maybe it’s a new growth market for the Cayman Islands?