One of the biggest challenges facing occupiers and economic development organizations is how to accelerate economic recovery, particularly in sectors like hospitality and retail that have been heavily impacted by COVID-19. Getting employees back to work is critical.
In the midst of these challenges, there are also opportunities. Trends that were already underway before the pandemic—like digitization and automation—are accelerating, with some companies accomplishing multi-year plans in a matter of weeks or months. Cloud computing, data centers and cybersecurity are seeing rapid growth as they continue to facilitate remote working. E-commerce is also growing, with distribution and fulfillment facilities moving closer to population centers. Economic development organizations are using technology such as drones and virtual tours to service the projects in their pipeline.
While more remote/flexible working is expected, the physical office— and the collaboration, innovation and community-building it fosters— is not going away.
Current market fundamentals are favorable to occupiers, and companies are pursuing cyclical portfolio adjustments and making decisions around consolidations, renegotiations and renewals. Long-term strategies for relocations and expansions are on pause—but not canceled. Business leaders continue to have fluid discussion about their future footprint.
There is an understanding that how we use physical workplaces will change—but uncertainty exists about what work environments will look like in the face of evolving health and safety concerns and what tactical steps will be required to navigate those changes.
Continued focus on transparency and accountability is expected. There is an urgency to create as many new job opportunities as possible, and economic development organizations will play a critical role in that effort. The impacts of COVID-19 will be felt for a long time, with potential for a permanent reduction in the number of retail jobs and a long-term reduction in the hospitality sector.
There is a premium on skills, education and training, and states that have prioritized customized workforce solutions will have an advantage going forward. Economic development organizations are taking existing programs and infrastructure and reconfiguring them to respond more quickly to the near-term needs of placing, upskilling and training workers while at the same time matching in-demand workforce to jobs.
Public-private partnerships will shift from a “one-and-done” model to one of ongoing engagement as companies navigate an environment that may continue to be volatile.
Although business has seen significant change since the onset of COVID-19, organizations still need to be where the talent is. Highly-skilled workers are in demand, and with the transition to an increasingly hybrid/remote workforce, occupiers will consider a broader geographic footprint to find the right talent.
The pandemic has also created a new set of criteria and considerations, including public transit, healthcare and technology infrastructure. At the building level, occupiers are weighing factors such as indoor air quality and touchless technology as part of their selection criteria.
Stephen Moret, President & CEO, Virginia Economic Development Partnership
J.P. Nauseef, President & CEO, Jobs Ohio
Tanya Skogerboe, Vice President of Strategy & Customer Experience, Sleep Number Corporation
Eric Stavriotis, Executive Vice President, Location Incentives, CBRE
Julie Whelan, Head of Occupier Research, Americas, CBRE
Pat Wilson, Commissioner, Georgia Department of Economic Development
Expert Roundtable Recording
Site Selection & Economic Development in the Era of COVID-19
July 15, 2020