The COVID-19 crisis has affected the real estate industry in various ways. For one, because society’s way ofliving, working, and playing has changed drastically in the last year, real estate leaders and investors must now find ways to take action and adapt to the evolving circumstances and lifestyle trends. For another, real estate players have not been immune to the challenges that came with the dwindling market. Many developers have had to contend with problems like construction delays and decreasing rates of return.
But at the end of the day, real estate investment is all about increasing the value of one’s property. No matter the state of the economy, landlords would be smart to employ strategies that would increase the value of their properties, whether commercial or residential. Here are some ideas for how to increase the value of your property in the time of COVID-19.
Commercial
1. Consider if it’s time for a face lift. Depending on how long your commercial property has been standing, you might want to consider if its current design fits today’s trends. Giving your property an aesthetic update is one of the best ways to increase your property’s market value. Cosmetic updates like an exterior makeover, lobby improvements, or repaved parking lots can make a world of a difference.
2. Find ways to decrease expenses. Because it wouldn’t be fair or humane to increase the rent during a pandemic, find ways to decrease your property’s monthly expenses instead. Determine if there are areas in your property where you can decrease the costs significantly. One example is switching to more energy-efficient light bulbs in your property’s common areas, and switching to energy-efficient alternatives in general. You can also use sub-metering utilities to provide each tenant with their own meters, making them responsible for managing their own utilities. There are a lot of instances wherein commercial property owners can cut back on costs without impacting the property’s operations.
3. Adjust the property’s intended usage. If your commercial property used to be an office, consider renting it out for purposes that are more attuned to the times. You can turn it into a self-storage facility-the 2008 recession showed that the self-storage industry remained recession-proof even during that period.
4. Find ways to make parking easier, or add more parking spaces. One aspect that makes a commercial property appealing to consumers or potential renters is how driver-friendly it is. Parking is one of the most important parts of commercial real estate, but one that is often overlooked. A lack of parking spaces may deter potential tenants. Make sure the property’s parking ratio is up to scratch, that the areas are well-lit, and that the signs are painted on with polymer road marking paint so that they last a long time and can withstand the elements.
Residential
1. Make space for a home gym, office, home work station, and a separate guest suite. Now that our homes need to be a house-office-gym-school-hospital hybrid, one way to enhance your residential property’s value is by ensuring that there are spaces for all these activities. A “casita” or a guest suite can be an enticing addition to potential tenants because it provides room for social-isolating for members of the family who need to keep their distance.
2. Enhance the property’s look and curb appeal. One easy way to do this is by painting the exterior, but you can also consider having the front re-designed altogether. A cosmetic makeover may give potential buyers or tenants more incentive to consider your property.
3. Cut down on energy costs. An energy-efficient home will help you save money, and is always a more marketable and valuable asset in the long-term.Incorporate energy-efficient fixtures and create more windows to let the natural light in. A skylight can also dramatically increase a home’s value because not only does it look good, it also helps residents cut down on electric bills.
4. Focus on landscaping. Giving your lawn a manicure can be a big way to entice potential buyers and tenants, especially if they would be spending the majority of their time in the property. Give the front yard or the backyard a face lift by planting more trees, which increases a property’s value in significant ways.
Whether you own commercial or residential property, think of our current situation as an opportunity. The pandemic has opened doors for commercial real estate investments that are high-demand in a pandemic, like grocery-anchored centers, data centers, self-storage, wireless infrastructure, and healthcare real estate. As for residential real estate, there will always be families who are on the lookout for a home to live in. When done right, a real estate venture can remain profitable even in a pandemic and a recession.
