The CRE Industry Is On The Cusp Of Historic Change, And Better Child Care Needs To Be A Part Of It

Shifting most employees from company offices to working from home was a jarring transition, but another big transformation for commercial real estate is on the horizon. Many firms have decided it’s time to attempt a return to the office, but with the coronavirus pandemic still burdening parents and other caregivers with school closures and other challenges, companies can’t simply open their doors and expect things will return to normal.

Whatever plans eventually get adopted, it will be essential for firms to balance competing needs, particularly if the pandemic drags on throughout 2021. Many workers, especially young recruits, can’t stay isolated at home and grow professionally. Others juggle child care duties or take care of elderly relatives, and returning to the office for the traditional five-day workweek isn’t an option. 

“We have a saying in America that we should all pull ourselves up by our bootstraps. Well, we all need boots that fit, we all need a fair shot at what that even means,” Kraai Advisors founder Karin Kraai said last week during Bisnow’s Chicago Deep Dish: Parenting in the Age of the Coronavirus webinar.

Studies show those burdens fall disproportionally on women, she added, and if accommodations aren’t in place, the commercial real estate industry could wipe out the gains made by women in the past few years.

Many top firms don’t yet have detailed policies and plans in place to prevent that, but their watchword is flexibility. In one of the biggest surprises of this era, most workers stayed highly productive on Zoom calls, giving companies comfort that keeping some at home long-term could be viable. Others can cycle between their homes and offices. These shifts could become permanent even after the pandemic and create workplaces where work-life balance is more than a slogan.

“Our family and friends should come first,” Avison Young CEO Mark Rose said.

The Toronto-based company recognized early that the pandemic was causing great stress, he added, with many struggling to arrange child care.

“We made a decision in April that everyone at Avison Young could work from home until 12/31,” he said. “That was mainly done for caregivers of all types, including parents, and for those suffering from any mental health issues.”

“It was clear that we all needed to de-stress, and it’s given everyone an understanding that we’re behind them,” Rose said.

The company will soon release a set of policies governing how it will bring people back after Jan. 1, he added. Scientists know far more about the disease and how it spreads than when the first wave hit last spring, making it more possible to create safe environments with masks, social distancing and other measures. Kraai asked whether people with children should have the option to stay home. 

“That is the toughest part,” Rose said. “We are 100% settled on the fact that one size does not fit all. If you need to work from home, we will do everything necessary so you can work from home.”  

But Avison Young remains committed to bringing back as many as it safely can, and in ways that don’t further disrupt families. The company's guiding principle will be that isolation is not good for anyone in the long term, especially younger workers who can’t get one-on-one mentorship through Zoom calls.

“We are starting to lose productivity in terms of the development and training of our young people,” Rose said. “We really need to get people back together again to avoid the isolation and get them communicating.”

Getting people back should boost productivity, which, after going sky-high in April, May and June, began to flatten, he said. And with most workers coming in for a few days a week rather than five, he hopes it will keep stress levels manageable. In addition, no one will feel pressure to travel.

“If you are uncomfortable getting on a plane, don’t do it,” Rose said. “We don’t want to put that stress on you.”

“Much of what Mark said is smart and rings true,” Transwestern President-Midwest Mike Watts said.

Transwestern adopted similar policies over the summer, formally opening its offices up after July 4 while following city and state guidelines for safety for those who were comfortable returning. The in-office workforce is now mixed, with some coming in on Mondays, Tuesdays and Wednesdays, and others on the last two days of the workweek. The two groups then flip days the following week.

“We’re also being sensitive to everyone who has an issue and can’t come in,” he said.

But Watts worries that those who aren’t burdened by caregiving duties and can make that commute could soon gain advantages over homebound workers. Managers may end up gravitating toward the people they see in-person every day, while those who are faces on Zoom calls don’t get the attention they need.

Family caregivers, frequently women, have seen their professional careers suffer like this for generations, but the post-pandemic office could stymie whatever progress was recently made, Kraai said.

And the management philosophy of every industry, not just commercial real estate, needs change. Managers will have to be more aware of the contributions made by those who can’t make frequent appearances and create metrics to measure the performance of everyone, including support staff with jobs that can’t be measured by dollars generated.    

“That could be much more management-intensive,” she said.

Rose said that as the new way of working has been so successful, both in terms of productivity and in creating a more humane family life, it’s going to outlast any pandemic. And the hard-won gains in terms of diversity should not be lost.

“I think this is now a permanent part of our lives,” he said. “The real estate industry is on the precipice of a huge change. Pre-COVID, we had an industry that was dominated by white males. I’m not picking on older white males who have been incredibly successful, but there is a diverse world out there, and it’s coming, and it’s coming quite rapidly.”

But the pandemic has already hit women more severely and made the U.S. workforce less diverse.  

Between August and September, more than 1 million people left the workforce, including those who quit jobs, were furloughed or took leaves of absence, and 80% were women, according to a National Women’s Law Center analysis.  

“This is the devastating impact of the ongoing breakdown of our nation’s caregiving infrastructure in the face of COVID-19,” NWLC Vice President for Education and Workplace Justice Emily Martin told CNBC. “As families across the country struggle to figure out how to keep their jobs while also making sure their children are cared for, safe and learning every day, it’s women who are being pushed out of work.”

Kraai said she is bothered that the pandemic hit just after women reached an employment milestone. According to the U.S. Department of Labor, women held 50.04% of payroll jobs in December, only the second time in history women were the majority of the workforce.

“COVID wiped out those gains,” Kraai said.

Watts said Transwestern is trying to make its workplaces more inviting to employees who are also caregivers. It may establish child care facilities within its buildings, possibly with tutors, but that could mean dealing with a maze of state and municipal rules.

“Child care is a heavily regulated industry, and the more you delve into it, the more difficult it gets,” he said.   

As the parent of high school-aged children, Watts said he has seen how each needs a different learning plan and schedule. That could point the way forward for businesses.

“The key is flexibility,” he said. “We may have to craft individual plan by individual plan to deal with this and provide someone the accommodations as needed to continue their career. Nobody has come up with a universal, one-size-fits-all solution.”

“I like the idea of flexibility,” Kraai said. “I have had a teenager with serious mental health issues going on, and we have to be on her and support her and be with her, so we all know there are different kinds of situations.”

“There is hope on this,” she added. “There are talks now about universal child care and paid family leave, but we have a long way to go in this country.”

Whichever strategies companies adopt to deal with the crisis, Kraai said the pandemic has given many people more opportunities to spend time with close family members, and that silver lining should not be ignored. Watts agreed.

“I played basketball with my kids every day for two months,” he said. “I hadn’t done that in years.”