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The coronavirus crisis presents a challenge unlike almost any other real estate downturn in living memory — how to play defense and offense at the same time.
There is a paradox at work. The U.S. and UK are facing historic recessions and big swathes of tenants are unwilling or unable to pay their rent. As a result, most real estate investors will have to deal with at least some problem assets in their portfolios. But those same issues create opportunities for investors, who have huge amounts of capital at hand to invest in the sector. Often it will be the same firms fighting fires and trying to take advantage of new opportunities. But how does that work in practice?
Partly this is a question of allocation of resources, how companies deploy people and capital. But doing this effectively is far from simple, and managers need a subtle understanding of human psychology and motivation as well as a solid business strategy to persevere as the outlook for real estate has never been less…
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