Business Turnaround and Property Advisers, Corelco, examine the changes and opportunities for businesses needing to repurpose their properties as part of a creative rescue plan, in the post-covid, new normal.
Commercial property owners are facing changes in demand, value, returns and usage.
The business press, and indeed the mainstream media, are full of speculation about how post-pandemic living will redefine the UK real estate market. Residential, commercial and industrial properties are all facing changes in demand, value, returns and usage as a result of the pandemic.
It is not just the obvious sectors who will require help in imaginative maximising of the potential in their real estate assets. Retail of all sorts, and hospitality businesses across the board, face well documented challenges that may yet lead to a further shake down in these sectors.
Business failures, insolvency, liquidations and administrations
are almost inevitable amongst those companies not fleet footed enough to integrate a solid property management strategy into any business recovery or company rescue plan they formulate.The effect of the home-working trend.
Mass home-working has cut people’s daily commutes and it is believed that most people would still like to work from home two days a week. This creates huge potential losses of revenue for businesses reliant on commuting workers. This extends into petrol sales and impulse purchase at forecourts, the entire food-to-go sector, and its supply chain, which reaches right back to food processing and agriculture.
Meanwhile reduced mileages in private vehicles impacts the motor trade
, including parts, servicing, tyres and consumables, which are the lifeblood of the independent motor trade and its dedicated supply chain.
And it’s not just these obvious sectors. The change to home working has also reduced the demand for both formal and smart casual office wear. Both on-line and hight street retailers have scrambled to lead the trend for relaxed work at home ranges, that fit the working from home look.
Companies operating right along this commuter-dependent supply chain face challenges which could lead to business failure and the need to seek help with a rescue or recovery plan. Corelco
are experts in formulating recovery strategies that, if activated soon enough, can provide a real alternative to traditional licensed insolvency proceedings.
In some cases, property assets that were a drag on the business turnaround prospects can be repurposed to create new revenue streams or significant injections of new capital.What next for property usage in our city centres?
There are currently 40,000 vacant retail units across the nation, a number that many experts predict will double by 2026. Debenhams, John Lewis and Marks & Spencer are amongst established and respected brand names to have lost out to changing shopper habits.
COVID-19 has moved the living and working habits of millions of people, with big implications for Britain’s towns and cities. Now, redundant real estate across the UK is increasingly being repurposed to revitalise struggling urban centres, often as an urgent part of a business turnaround process
.Retailers and Logistics Providers
The new normal in city centres will look vastly different to life before 2020. Fewer people will buy goods in-store as the shift to ecommerce becomes a permanent feature of post-pandemic shopping habits. Online shopping has also cemented the need for more warehouse space and delivery depots closer to city centres. Retailers and logistics providers, in turn, will search for more central delivery depots to fulfil online orders via ‘last mile delivery.
At the same time many former stores are now being repurposed for a future outside of retail including:
• Flexible office space
• Logistics firms seeking central delivery depots
Recent changes to the planning system brought about by the coronavirus will benefit the repurposing of many of these retail assets. So, the reimagining of retail and office space for logistics and housing simultaneously represents the abundance of supply and great demand for these assets.
Andrew Beevers, Property Consultant at Corelco says,“Not all sectors will win – only where locations, economics, infrastructure and demand align, vacant retail space will become sought after for change of use and development.”Solving the housing crisis – new uses for industrial and commercial property.
The pre-pandemic housing crisis persists, and a shortfall of more than 750,000 new homes over the next five years makes redundant office buildings desirable locations for residential developers. For example:
• In Leicester, two redundant office blocks will undergo a £60 million refurbishment to create apartments.
• In South Yorkshire, a former council building and a derelict bowling alley are earmarked for new homes.
• In Salford, new apartments are to be built in place of two former office buildings.The threat of business failure.
For many businesses, the bounce back is in sight, and a mixture of agile management and government support schemes have enabled them to stave off the threat of business failure during the pandemic. Sadly, for many businesses, the recovery will come too late and their business models, whilst credible, may need help to create breathing space and time to readjust.Corelco strategic property
services help companies to develop effective and creative solutions that match their overall business objectives – making the best use of assets tied up in commercial property. Corelco put decades of business experience at the immediate disposal of business owners facing mounting pressure and impending failure.
Focusing solely on your interests and free from regulatory oversight, Corelco deliver a highly personalised service to businesses – providing new options and an alternative to traditional insolvency or liquidation.Call Corelco today on 0203 773 1417.