We have heard of the three things that matter in real estate: location, location, location. But the world has changed considerably and based on emerging trends that we experience because of the pandemic, competition in real estate has spread to many areas.
“The future of real estate is no longer about delivering four walls to tenants,” said RXR CEO Scott Rechler. “Instead, it’s about creating a unique, personalized customer experience that fosters meaningful interactions, collaboration, productivity. Delivering this will require a unique combination of capabilities that seamlessly integrate across the physical and digital realms.”
“Digital solutions have democratized access to experiences and conveniences for individuals and companies,” said Clay Cowan, a McKinsey partner. As people have grown accustomed to digital experiences like online banking, tele-health, or e-commerce for example, “they expect similar from the spaces in which they live, work, play, and shop.” Stakeholders must set a new bar for the “new normal” homebuyers and occupiers to survive and sustain. The road to recovery is full of trip wires and the next four quarters will be a defining litmus test for developers. How they will woo the elusive buyers spread from all generations—baby boomers all the way to the Z generation—will determine their growth trajectory in 2022.
In one of my public engagements, one of the participants asked me what key internal intervention and external events (which I will share in my next column) should the stakeholders initiate that will impact the future of their organization in the next three years. My straight answer was not three years but now. Disruptions are unfolding and stakeholders must focus on the present.
The future is here
Stakeholders must reboot fast. With what has happened to every economy all over the world, every organization must now embrace a disruption-ready culture. I have outlined here several key values worth mentioning.
First, thoroughly understand your market and industry space. The barometer of real estate is our economy. We are part of what economists refer to as primary cyclical industries and our decline and upswing patterns can be attributed to economic shifts. With the severity brought about by the pandemic, keeping things together during this tumultuous downturn can be tough—very tough.
During strategic planning sessions where I am asked to facilitate, I would always hear from talented boards that they always consider this economic cycle as a real turnaround. That is why planning and bracing for a post vaccine recovery is important. The art of dealing with this pandemic is keeping the business afloat long enough for the economy to kickstart and recover. And that can take as much talent as the redirection of a company’s project lineup.
Which leads me to my next answer: the importance of having the right professionals in your organization is critical to your success. Too often, company leaders focus on what the company needs to do. They develop a vision and spend time on strategy before they give any thought as to who is going to implement their grand plans.
If you don’t have a quality workforce, better start searching for them. However, if you have the best people that are aligned and deployed in the right positions, they will tell you what is wrong, what needs to be done, why an intervention is important and most importantly how to take the company there.
The key is to transform
Jim Collins made this point in his best-selling book Good to Great, which centers on examining the success stories of companies that pulled away from their pack of competitors.
Collins found that the companies that achieved long-term success did so in part by focusing first on “who” and then on “what.” As Collins wrote: “The executives who ignited the transformations from good to great did not first figure out where to drive the bus and then get people to take it there. No, they first got the right people on the bus (and the wrong people off the bus) and then figured out where to drive it.”
Today’s pandemic has turned our world upside down in ways that we never anticipated. After decades of observing stubborn stakeholders resisting the increasing pace of change and the many innovations disrupting the property landscape, we are now encountering a situation that makes it impossible not to change.
Every player, large and small, has been threatened, and every leader is facing deep challenges. There is no room for complacency nor impulsive, short-sighted decisions. It is time to professionalize your organization.
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