Archives for May 2020

Buffini: Prepare Your Business for the ‘Green Flag’

May 15, 2020 by CARNM

When a crash happens in a NASCAR race, officials fly a yellow flag to indicate to other drivers that they must slow down and exercise caution until the wreckage is cleared. That’s where the country is in the race to beat the coronavirus pandemic after it collided head-on with the economy, real estate coach Brian Buffini said Thursday. He used the analogy during his session, “Business Strategies That Meet the Moment,” at the virtual 2020 REALTORS® Legislative Meetings.
Now the U.S. is in the clearing phase of the pandemic, Buffini said, and just as NASCAR’s green flag indicates the restart of the race, real estate pros should watch for signs that their clients are safe and ready to buy and sell homes. “Spring is going to hit in the summer,” Buffini said. “People who put off a move are now going to make that move.”
Buffini reiterated statistics released earlier by National Association of REALTORS® Chief Economist Lawrence Yun predicting that the industry will bounce back from the pandemic. Overall, there has been a 10% to 15% drop in transactions since March, but home prices have increased 1% to 2% since last year due to low inventory. Yun projects a strong return in the third quarter of 2020 and a 13% to 18% increase in sales in 2021. This, coupled with record low interest rates, will help drive the comeback, Buffini said.
“The economy is opening up around the country at different times and in different ways,” Buffini said. The various reopening plans make sense: For example, as of May 14, San Diego had 200 COVID-19-related deaths—a far cry from the more than 20,000 in New York. Buffini predicted that the economic impact of the pandemic would ultimately be incomparable to the Great Depression of the early 1930s. “It’s not a 10-year slide like it was in the Great Depression,” Buffini said. “Massive numbers of people are going to come back.”
Buffini advised practitioners to start preparing now for the real estate uptick this summer and fall. He also recommended three daily affirmations:

Routines develop resiliency.
Predictability leads to stability.
Structure leads to steadiness.

Create routines, even if you continue to work from home. Those routines will create stability and structure. Buffini also suggested that brokers and agents revisit their business expenses and increase their outreach to costumers every day so that they’re in a good place before the third quarter. “Hit the gas when the market reopens fully over the next six months,” he said.
Buffini is offering his 5 Circle Fit Challenge to real estate pros for free to help get their business prepared. Learn more at Buffiniandcompany.com/BCBonus.
Source: “Buffini: Prepare Your Business for the ‘Green Flag“

Avison Young Sees Downward CRE Trend Because of REIT Stocks

May 14, 2020 by CARNM

The hardest hit sectors have been hospitality and retail, according to the firm.

How Your Response to COVID-19 Can Attract Clients

May 13, 2020 by CARNM

Researchers have developed a five-step guide for managing business relationships during a crisis. Get ideas for how to apply them to your real estate operations.

In a relationship-driven business like real estate, it may seem impossible to keep physical distance yet still feel emotionally connected. But practitioners are finding new ways to form bonds with their clients during the coronavirus pandemic and increase their customer pipelines.
To do that, take “HEART.”
Texas Tech University researchers, as well as professors Ted Waldron and James Wetherbe, developed the HEART framework to guide small businesses through their response to the crisis. The model, which reviews seven decades of business practice and scientific research, consists of the following steps:

Humanize your company
Educate about change
Assure stability
Revolutionize your offerings
Tackle the future

‘H’ is for Humanize

Leverage empathy by acknowledging the unique circumstances your past and current customers are facing during this time. Be careful about blending “caring” messages with a sales message, Waldron and Wetherbe note. Also, don’t be afraid to address the grimness of the current reality. If your business webpage or marketing doesn’t mention COVID-19 at all, you risk looking irrelevant, Chris Smith, co-founder of the digital marketing company Curaytor, told attendees during a recent realtor.com® webinar.
Reach out to customers in a variety of ways, from sentimental to humorous gestures. Connie and Dan Carlson, founding partners of Ansley Atlanta in Marietta, Ga., launched a “Marietta Strong” blog at their website, promoting a “we are all in this together” message. A video at the site shows community hot spots and local businesses, along with a message of hope, resilience, and unity in the face of COVID-19.
Even seemingly small gestures can have a big impact. Brad Inman, founder of Inman News, recently shared how the makings for a dinner treat—chicken and leg of lamb—was unexpectedly left on his doorstep. “It was from my local real estate agent,” he said on a recent podcast. “No card, no expectation, and exactly what I needed. Never before have smart, caring agents proved their value more so than right now.”
Fun and humorous ways of connecting may inspire the greatest following. Kristina McCann, broker-owner of Chroma Realty in the San Francisco area, started a ‘mingo’ movement that other real estate professionals in California have replicated. In the evening hours, pros stake out a flock of plastic pink flamingos in people’s yards with “happy birthday” messages for those missing out on special celebrations during the pandemic. The gesture is not about marketing their companies. “My intention was to just spread joy and happiness to people during this time,” says Anthony Marguleas, broker-owner of Amalfi Estates in Pacific Palisades, Calif. “We just wanted to put a smile on people’s faces.”
Likewise, Terry Wolak and his alter ego, “The Messy Chef,” are becoming an internet sensation. Wolak, a sales associate with Howard Hanna Real Estate in Penfield, N.Y., shows off his culinary talents in Facebook Live videos shot from his “quarantine kitchen.” His humorous cooking shows also occasionally feature a friend—keeping distance from one another, of course—such as one captured playing a guitar outside his kitchen window. “I think right now people yearn for the humor, the connection, the interaction,” Wolak told Spectrum News about his videos.

‘E’ is for Educate

Share with customers via social media, e-newsletters, and on your website how they can interact with you during the pandemic. Let them know the business changes you’ve made, too. As Chicago issued its stay-at-home orders in March, Erica Cuneen, CIPS, GREEN, broker-owner of Beyond Properties Realty Group, was quick to reach out to customers with weekly emails informing them of how real estate was adapting. The brokerage’s emails detailed in a simple format steps that were being taken among four customer categories: for sellers closing, buyers purchasing, active sellers, and active buyers.
Eric Rollo, CIPS, a sales associate with William Raveis Real Estate in Boston, launched a “COVID-19 Resource Hub,” a one-stop website where visitors can learn about health department updates as well as guides on how to access emergency aid. The site culls links on the latest number of coronavirus cases in the Boston area and the state of Massachusetts, homeowner mortgage assistance information, rental assistance and small business help, unemployment aid, and volunteer opportunities.

‘A’ is for Assurance

As the economic and personal toll of the virus mounts, customers may look to companies for assurance. Connie Carlson, associate broker for Ansley Atlanta in Marietta, Ga., posts weekly market snapshots on social media, which include the number of homes listed, under contract, and sold. “We do this to reassure that the market is still continuing on,” says Carlson, who recently listed seven new properties in one week. “Sellers still need to sell, and buyers still need to buy.”
Carlson also requires her clients to sign a COVID-19 release form prior to home showings, which she says puts them at ease. The form asks buyers to verify that they aren’t currently ill and to keep their hands in their pockets during tours. Sellers are asked to turn on all lights and open closet doors prior to any showing. “We want to limit how much people have to touch things in the properties,” Carlson says. “We have our clients sign these forms to feel more comfortable that everyone is doing their part to prevent the spread of germs from house to house.”

‘R’ is for Revolutionize

“Technique often lags behind technology,” Wetherbe says. “The pandemic has forced innovation in doing things differently.” Real estate professionals are using tech tools for showings, such as virtual tours and agent-led video walkthroughs. Carlson is doing a Matterport 3D tour for all her properties, enabling online house hunters to walk through a property virtually, assessing a home in all directions, and even peeking inside closet doors. She’s also holding virtual open houses on Sundays, where online visitors can tune in to livestreams of house tours.
Kara Keller, SFR, a broker at Baird & Warner in the Chicago area, is using a drone to show off her listings (video above). She teamed with Doola, a digital marketing company, to send a drone inside properties to capture video footage. Keller then narrates the drone-led video tours and promotes them on the MLS and her website as a way buyers can tour properties remotely.

‘T’ is for Tackle (the Future)

As your company innovates, look for ways to adopt new processes for the long haul. After all, “some of this technology being embraced could help real estate professionals ultimately sell even more houses in less time,” Wetherbe says. For example, relying on face-to-face showings before the pandemic may have been time-consuming. Now brokerages have developed new ways to virtually show homes and keep people from having to spend time traveling to a property.
Businesses should not be quick to abandon new processes once the pandemic is over, the researchers note. These new ways of doing business could prove to be a differentiator in the future. Companies that are quick to return to older business methods may ultimately fall behind. “I believe the companies that will stand out will be doing things a different way in the future, too,” Waldron says.
As businesses sort out the future, the researchers say that a customer-centric attitude and awareness of what people need right now is key. “Companies can emerge from this crisis with strengthened relationships with customers,” the researchers note in an article published in the Harvard Business Review. “Give consumers your HEART during this difficult time. It will cultivate long-lasting goodwill with past customers and help ensure they will stay with you in the future.”
Source: “How Your Response to COVID-19 Can Attract Clients“

Is Curbside Pickup a Long-Term Strategy or Short-Term Fix?

May 13, 2020 by CARNM

More retail landlords are rolling out the option for mom-and-pop tenants. The trend is expected to stick.

As the COVID-19 pandemic continues to wreak havoc on the U.S. retail sector and alter the way people shop, big retail landlords are implementing curbside pickup programs to help their tenants ramp up sales as the economy begins to reopen.
Kimco Realty Corp. and Federal Realty Investment Trust are two large shopping center owners designating curbside pickup areas at their centers for essential retailers that are currently open and non-essential retailers that will reopen as government restrictions are eased.

These landlords say they want to help retailers and their customers adapt to the changing shopping habits caused by the pandemic.
Jericho, N.Y.-based- Kimco, which owns 409 U.S. shopping centers and mixed-use properties totaling 72.4 million sq. ft., rolled out its Curbside Pickup program at 23 centers in Texas. Many of its properties are open-air, grocery-anchored centers.
Kimco plans to add these designated curbside pick-up spaces to its retail centers nationwide to be used by all tenants and their customers. Kimco executives say it’s a way for customers to ease back into a daily shopping routine while feeling safe and comfortable.
To use the service, a customer places an order with the store through their website, app or by phone, and chooses curbside pickup. The retailer provides the customer with the appropriate “Pickup Zone” (for example, Zone A, B or C). The customer is instructed to call the store once they’ve arrived, indicating which spot number they’ve parked in. The retailer brings the item to the customer’s vehicle and places it in the trunk.

The program was launched at Grand Parkway Marketplace in Spring, Texas, with 60 parking spots dedicated for curbside pickup.
“We started with our whole portfolio across Texas, because that was really the first state to reopen their doors,” says Conor Flynn, Kimco CEO.
Starting April 24, Texas began allowing non-essential retailers to start offering curbside pickup of online and phoned-in orders.
“That will quickly be followed by Georgia and then it will be taken nationally,” Flynn says. He notes that curbside pickup was a trend that was accelerating before the pandemic, but has picked up momentum.
“It’s a natural extension of what the consumer is looking for today, which is convenience, value and just having a suite of amenities that are available to them.”

Proof is in the pudding

During the pandemic, more consumers have turned to online shopping.
Buy online/pick-up in store orders surged 208 percent between April 1 and April 20 compared with a year ago, as consumers continued applying social distancing to shopping to limit their exposure to COVID-19, reported Adobe Analytics, which measures the buying power of digital consumers.
Additionally, Adobe reported that U.S. online sales shot up 49 percent from March 11 to April 21 compared with a baseline from March 1 to March 10.
“Since the pandemic has occurred… some of our public retailers have said they’ve seen growth in their curbside pickup orders of over 200 percent,” Flynn notes.
Essential retailers like grocers, Target, Walmart and Lowes have been offering curbside pickup successfully during the pandemic as they’ve been allowed to remain open.
Kimco’s program now formalizes the process and expands it beyond the national retailers to local mom-and-pop businesses.
“The concept originally was one where we saw a lot of our national retailers really doing a nice job,” Flynn says.
Essential retailers operating through the pandemic have been offering curbside as a way to keep shopping centers busy and get consumers comfortable with coming back to the center. “So, we thought long and hard about it,” Flynn notes. “Okay, if our national retailers are doing this and are successful, we should quickly move so that we can make sure that this becomes a best practice across all of the retailers in the shopping center.”

Non-essential retailers haven’t had the luxury of operating during the pandemic, so “we figured as a landlord, we could have this program in place and ready to go when they’re allowed to reopen.”
The small shops are going to need a lot of help out of the gate, Flynn says. This is a way for them to engage curbside pickup in a way where there previously was no formalized program, and they can start to utilize it to help their sales rebound quickly.
Kimco also established the Tenant Assistance Program (TAP) to help tenants apply for government-sponsored COVID-19 aid programs
“We’ve been trying to act quickly and be nimble recognizing that certain retailers are well-positioned and can use their balance sheets to weather the storm, but there are a whole bunch of small shops that need help—from curbside pick up to legal advice and services to help them get to the PPP program,” Flynn adds.

Curbside is ‘here to stay’

Because of how simple it is, you see how quickly it can become adopted as a new normal, Flynn notes.
“That’s why we think it’s here to stay,” he says. “A lot of people were buying online, but electing to pick it up in-store. With this pandemic, I think there are going to be a lot of people who just elect for curbside pickup from here on out.”
Similarly, Rockville, Md.-based Federal Realty, which owns 104 shopping centers totaling roughly 24 million sq. ft., is rolling out its curbside program dubbed The Pick-Up on May 15. It will provide a contactless exchange for its centers in anticipation of a phased reopening for retail tenants in the coming weeks. The service is for retailers and restaurants of all sizes.
“The Pick-Up takes what is already a growing trend and builds a scalable platform, making it easier for merchants and customers to coordinate the quick, contactless exchange of products to help our tenants drive demand,” said Don Wood, president and CEO of Federal Realty, in a statement.

Meanwhile, ICSC reported that Cincinnati, Ohio-based Phillips Edison & Co., a large owner and operator of grocery-anchored shopping centers, launched its Front Row to Go Program. It’s an expansion of work the landlord previously did with grocers to accommodate pickup programs.

Growing trend

Real estate services firm JLL is receiving more requests from tenants wanting to offer curbside pickup, says Greg Maloney, president and CEO of the firm’s Americas retail division.
“We’re working with them and converting spaces for curbside pickup. We’re putting up cones and signage,” he says. “We’re putting tents out there. We’re trying to do anything for the customer so that when they come in, they go, ‘Ahh. Here’s where we go [to pick up orders].’”
Maloney believes curbside pickup will become a long-term strategy for many retailers and restaurants, but not all might be able to keep up with orders when in-store businesses fully reopen, particularly restaurants.
“These restaurants that are doing it just to keep their doors open, when they get busy again, they’re saying we can’t do it,” he notes.

Curbside pickup is an effective strategy

“It has been a game changer and it will stay at higher levels,” notes Deb Carlson, a director in the Twin Cities office of real estate services firm Cushman & Wakefield. “Not as high as it is now, but certainly higher than it has ever been, because it just works so well. It’s just another way—even when the world is reopened again—to shop.”
For example, curbside pickup has “kept the grocery stores rockin’ and rollin’ these last two months,” Carlson says.
She speaks to grocers around the Twin Cities, for example, who have shared that their curbside pickup has increased from single digits to 40 to 50 percent during the pandemic. “I think it has become so easy and so nice to have, that consumers are going to keep up with it,” she says, adding it won’t just be grocers but other retailers as well.
Carlson believes that that world might not “right itself” until there’s a vaccine.
“Nothing happens until people aren’t scared anymore,” she notes. “People are going to be scared for a long time. As long as there’s some fear out there, curbside pickup is just going to make a whole lot of people feel better.”
Eventually, however, people will return to in-store shopping.
People will say, “I need to see what’s new. I need to look and see the product. I need to get back into my routine,” Carlson points out. “So those who’ve done [curbside pickup] 100 percent of the time might start to do it 50 percent of the time.”
Carlson also notes that curbside pickup assumes consumers have previously shopped online.
“Your online brand has to be really good and work really well,” she says. “And you have to have consumers that are really comfortable with that.”
The disadvantage for retailers of curbside pickup, is there’s less impulse buying and not everything in the store is online.
“And it’s less of an experience,” Carlson adds.
Source: “Is Curbside Pickup a Long-Term Strategy or Short-Term Fix?”