Rooya Group Chairperson Hisham Shokry said the post-coronavirus real estate market will experience prominent changes, including turning to online practices.
These changes will reflect other sectors worldwide, with many activities and businesses also switching to a greater online presence.
During a virtual roundtable discussion, entitled “The New Real Estate Product”, held by Invest-Gate on Monday, Shokry noted that tourism will also witness some developments. The hotel rooms will be used for longer periods of time, requiring a change in design as a result, to accommodate the extension in client presences.
Shokry added that commercial projects will change in the aftermath of the coronavirus crisis, with online shopping increasing. As a result, developers will be obliged to increase offers to attract customers.
He explained that for administrative projects, changes will occur in design and use, with less space needed in light of increasing dependence on the Internet. This will be particularly in implementing business meetings and reducing the percentage of employees needed in offices, with many being able to perform much of the work from home.
Until now, there is a glut of facilities that are now no longer needed, with profit margins no longer being able to be waived. The only component that can be reduced in the industry is land, he said.
“Global property exports in the coming period will face a problem due to the difficulty of moving between countries with air traffic restrictions, therefore there will be a slowdown in real estate exports in the coming period,” Shokry explained.
Ahmed Shalaby, President and CEO of Tatweer Misr, said the real estate sector’s main changes in the post-coronavirus era will be greater work from home and increased Internet usage. As a result, it will only be necessary to build small office spaces, as well as adding a small office space inside residential units.
Shalaby added that multi-national companies have already started to develop new, varied and flexible designs that allow for extra office space to be added within resident units according to multiple options.
He pointed out that conferences activities will also be reduced in the post-coronavirus period, which will mean hotel conference spaces will require reassignment to other uses. Shalaby called for attention to be paid to health services within real estate projects, and that developers should have the right to implement hospital services as part of their projects.
“New additions to real estate products will not lead to increase in unit’s value, as change is mainly in interior design of the unit. Moreover, current circumstances require new mortgage financing systems, including other types of units and other flexible conditions,” Shalaby said.
“Real estate companies’ sales plans were affected by the coronavirus crisis, as the majority of companies achieved 50-60% of their targeted sales during the first half of this year. However, most companies can achieve 80% of sales targets for the current year, due to expectations of sector revitalisation in second half of the year.”
Amr Soliman, Chairperson of Mountain View, noted that commercial centres have to provide attractive entertainment components for clients. This comes particularly as clients will be relying more on online demand during the coming period. Soliman stressed the need to study new customer demands in the post-coronavirus period.
Soliman noted that customers face reduced purchasing power, which cannot be solved by reducing unit values. He added, ”It is important to initiate a new funding body that covers the customer’s purchasing power.”
Ashraf Ezz El-Din, Managing Director of Al-Futtaim Real Estate, said that there are trends to reduce employment within institutions. This makes their need for large areas more limited, and he advised commercial space developers to increase area allocated for leasing more than selling as a result of changes in customer requirements.
Ezz El-Din stressed that property designs, whatever their activities, will change after the coronavirus crisis, although the shape of that change has yet to be definitively determined. He noted, however, that there is an increase in transformation with customers now more interested in environment and public health.
CEO of IWAN Developments, Waleed Mokhtar, said the current economic conditions resulting from the global health crisis will lead to a difference in real estate products and purchasing power of target customers. It will also cause differences in customer behaviour and the emergence of new customer activities leading to a change in design and decoration of real estate units to accommodate these changes.
Ahmed Mansour, CEO of Castle Development, agreed with Mokhtar that customer needs and behaviour have started to change regarding housing unit purchases. There will be an increased focus on accommodating more comfort due to the increased stay-at-home period.
Mansour added that trend for e-learning will increase in the coming period, as administrative and commercial projects will change following the crisis. This would qualify them to meet changes in uses and activities in the coming period.