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In more ways than one, the ongoing COVID-19 pandemic has impacted people, markets and economies around the world. The state of the crisis is not yet fully determined because there is too much information available, changing frequently and causing confusion. Since the virus is exponentially contagious, its rapid spread has made concepts such as social distancing, working from home and self-quarantine the new normal. This capricious scenario makes it crucial to have a clear and consistent general direction, especially in the case of governments and organizations.
In India, the government’s cautious approach helped limit the effects of the outbreak as it proactively implemented a nationwide lockdown. The short-term impact is a complete shutdown of activities, but the medium and long-term impact can only be assessed once we have reached the bottom of the crisis.
However, the virus has caused many learnings and changed the conventional way of working, for many sectors including that of real estate. Businesses have had to adapt and evolve quickly to ensure work is not impacted. There are a number of long-term lessons that have resulted from the outbreak for property developers.
Diversification investment in assets is essential to reduce risk. Developers usually invested in residential or commercial real estate, but in light of the crisis, they realized that it was just as important to allocate the money in industry, health, warehousing and other segments. By hedging the bets, they do not run the risk of losing a large amount of investment when the economy is affected. Furthermore, ensuring that the supply chain is sufficiently diversified and not entirely dependent on a single source will contribute to appropriate risk management in the future.
Digital ecosystem is a requirement that can no longer be avoided or delayed. The virus that has spread from human-to-human contact has led to the understanding that going digital with Big Data analytics can reduce the reliability of the individual, make them more secure, and transform the course of finance and execution of transactions. New technologies such as artificial intelligence and the Internet of Things are here to stay and provide great opportunities for business by allowing the buyer to “see” and “feel” a particular property. The built environment sector should now prepare aggressively to embrace digital construction, prefabrication, robotics and drone technologies as workforce challenges will continue to impact the business for times to come.
Detection and control capabilities can be greatly improved through the use of data, allowing developers to manage various operations. Implementing analytics can help developers predict and manage situations; Connecting and gathering data by leveraging machine learning algorithms enables more intuitive and smooth operation. The data and analytics can be used to generate insights that can be used to make informed location and rental decisions.
Supply chain resilience is a critical aspect that must be considered from a developer’s perspective. A break in services seriously impacts a project by disrupting stock quantities. It is imperative to build a sustainable, flexible and responsive supply chain to ensure that work does not stop in times of uncertainty and that projects can be on track.
Build agility in business is essential, as the virus has made clear to us, crippling economies around the world. It is essential for the developer to ensure that the transition is smooth and seamless from one platform to another without impacting continuity. Such situations may arise in the future and it is essential to create agility for the delivery of the project.
In addition to the lessons stated above, a developer must now invest heavily in carrying out proper project feasibility studies. Variable cost models can also help the developer attract and retain buyers, encouraging them to invest money and making projects economically suitable for every budget. Examining innovative “real estate consumption models” will help boost demand that languished even in the pre-COVID era.
Keeping the “Four Cs” in mind can be a good immediate starting point for future-proofing the business:
Care covers thoughtfulness for staff, customers and partners. The flexibility to work from home in the event of a stressful situation with employees. Maintain authenticity and transparency at work. Adopt a collaborative and developmental approach to work, as needed.
Retention includes cash, supply chain, talent, critical functions, business continuity plans, and timely coverage of activities due to any ripple effects.
Change includes rethinking the “new normal”; reinvent and adopt a new approach to stakeholder engagements. Rethinking the supply chain towards a “resilient brand”.
Construction which encompasses building resilience through redundancy, diversity, modularity, conservability and scalability
The lessons that the COVID-19 situation has taught us are valuable to say the least. Living under lockdown, we have learned to adapt and discovered new ways to manage work and life. We found that organizations with a faster recovery quotient constantly looked ahead and reacted quickly in response to paradigm shifts. They explored different approaches to deal with changing dynamics and created opportunities where none existed. This knowledge will arm us with the confidence to face the challenges of a “new world” that we are entering in the times to come. It will remind us that every challenge has a huge code of opportunity hidden in its DNA. He must be recognized for his conviction, his agility and his entrepreneurial spirit.