Are you prepared for the coronavirus?
Chances are that the coronavirus is already in your state and city. Panicking isn’t productive. Though it is only the intelligent thing to do to be prepared.
This is specifically true for property investors, landlords and their asset managers. Do not underestimate the threats to business continuity and returns. It could cost you everything. On the bright side, applying new procedures and systems could help investors come out on the other side stronger and operating more profitably than ever.
While the risk of anyone individual being infected in this pandemic may be low for now (if they are implementing all best practices), it seems irresponsible to stick your head in the sand and just hope for the best.
Most would agree that investors, landlords and property managers have some responsibilities. Even where it isn’t a duty or legal obligation, it just seems smart and the right thing to do to be proactive.
You may be responsible for your residents, investors, asset value, performance, and workers.
The Good News
There are some positives from the outbreak.
The first is the emergency fed interest rate cut which has slashed rates to just over 1%. Tenants may less be more likely to stay and renew leases, rather than to attempt too much travel and shopping around for new apartments until this has passed. It is also proving good for many retailers. You wouldn’t think people would want to be rushing to the stores, but they are. They are stocking up and clearing the shelves in case they are quarantined. They may actually be speeding up and broadening the spread of the disease, but shopkeepers are happy. A Costco in Oregon says that for the first time in history it has even run out of toilet paper.
Unexpected Side Effects
Some key things to keep in mind this year is the side effects that may be less obvious.
There is the risk of a direct impact on income and performance if workers can’t work or entire apartment buildings become infected or are quarantined.
There are also risks of construction delays, lack of labor due to illness, and shortages of construction materials. Real estate closings may also be delayed. Make sure to allow for these factors in your plans.
Hotels are already preparing for a hit, as are airlines who are waiving change fees. Some may want to switch from very short term rentals to longer leases to get through this period.
Ways To Protect Your Teams
- Move to remote meetings
- Minimize travel and interaction
- Move to online rent collection and leasing applications
- Choose video tours for prospective tenants
- Close on-site offices and replace permanently with virtual assistants
Ways To Protect Your Tenants
- Sanitize common areas
- Deep clean and disinfect between turnovers (the virus can stay on surfaces for up to 9 days)
- Sanitize package acceptance lockers
- Only allow healthy employees to go on-site for maintenance work
- Eliminate paper documents
- Educate renters on staying healthy, grocery delivery, where to get supplies, remote work and childcare in case schools are closed, as well as third party financial aid
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