New Developments: Lessons From the Crisis
By Thom Amdur
3 min read
I sincerely hope that you and your families are well and staying safe as the country continues to come to terms with the COVID-19 pandemic.
The residents we serve are amongst the most vulnerable to both the health and economic effects of the crisis so, as an industry, we cannot afford to take a break or slow down. Much of our vital work has continued (with modifications) under new social distancing protocols and I want to acknowledge our many colleagues who are risking exposure to ensure critical maintenance and services get delivered, construction projects remain on some semblance of a schedule and, of course, rents get collected.
In just a few short weeks, we have experienced collective whiplash as the financial markets see-saw, state and local shelter-in-place regulations evolve and unemployment figures increase at meteoric rates. With so much to be worried about, it is easy to focus on what else can go wrong. As a “glass-half-full” kind of person, I prefer to focus on what may end up as positives for our industry once we have gotten through the immediate crisis at hand.
The affordable housing community has admirably responded with remarkable speed and urgency to this crisis, adapting to and innovating new approaches to construction, property management, finance and development.
For better or worse, COVID-19 is motivating our industry to modernize. Many of the cumbersome “paper” applications, leases, architectural and building plans, permits, work orders and other sundry related documents (often requiring “wet” signatures) are finally going digital. This will ultimately save time, storage and dollars. Many management companies are successfully transitioning residents to pay rent electronically or by ACH. Less reliance on cash, checks and money orders benefits both residents (lower fees) and the landlord (less time processing paper-based payments).
Many of our members have gotten creative showing apartments virtually to tenants, as well as to providers of third-party reports, like PCNAs, appraisals and market studies. Some routine building inspections are being done by FaceTime or other video-conference technology. Routinizing these types of strategies could translate to faster development, finance, construction and lease-up timelines, which can result in reduced interest carries, expedited equity pay-ins, faster unit turns and other financial positives for the transaction.
Finally, the crisis is fundamentally changing the way many of us work. As we embrace (and perhaps test the limits of) remote work, we may be able to reduce some office overhead and drive more productivity in many parts of our business. Domestic-based modular and/or panelized construction companies will likely find new clients too. Beyond the cost and construction velocity benefits, these platforms, with their reliance on robotics and precision technology also allow for social distancing on a much greater proportion of the overall construction process.
America is resilient and I am confident we will see our way through this crisis. We will struggle with the sadness of personal tragedy and economic dislocation; however, our values, institutions and work ethic are strong and will carry us through. The social contract will remain intact and we will be on the front lines repairing the damage done by this virus with affordable and attainable housing. Life and business may not return to our former normal, but we will find a new normal, whether it takes weeks or months. And it may well be a better, more efficient, more productive normal because of what we have learned.
