Corona may hit real estate hard
Corona virus that has caused panic across. It is being said, the virus will hit the real estate and other ancillary business hard.
By Varun Singh
Corona, if one makes a list of fear words, then it will top the chart. It is impacting everything, from work to office spaces and even the hospitality industry and real estate too.
On Thursday, Vineet Jain, Managing Director of Times of India Group, tweeted, “Why hasn’t tech advanced to a level where most people don’t need to go to office? Company measures your productivity on computer, meetings via video conference. It will limit office goers. Office Real estate market will crash & pollution level will drop & cities will be beautiful.”
While Jain didn’t mention the deadly Corona Virus in his tweet, many presumed and connected it to be associated with the outbreak of Corona in the city of Mumbai.
However, the biggest takeaway from his tweet was also about the office real estate market which he suggested will crash. Many are presuming the same, that because of the outbreak of Corona virus in the city with patients being tested positive things will go downwards.
Jain’s office real estate market crash suggestion is being echoed by many in the realty sector.
The impact of Corona will be huge on the realty sector. For example, one twitter used posted, that if work from home culture seeps in, it will even impact the residential real estate sector.
A twitter user named Rahul said, “This will be one irreversible change Corona precautions will lead to. Companies will reduce office space. Remote working will become common. People do not need to move to big cities – Bangalore , Pune , Hyderabad etc. as a result residential real estate will also stagnate or drop.”
On hospitality industry the impact of Corona Virus will be huge.
Anuj Puri, Chairman – ANAROCK Property Consultants, says “India’s hospitality sector will definitely be impacted by the announcement of a global pandemic, and the mounting numbers of confirmed coronavirus cases in the country. The cancellation of visas for foreigners as well as the strong advice issued to Indians to refrain from unnecessary travel will have a marked effect. This is the most unsettling healthcare crisis in recent times and hotel bookings will go south. Luxury hotels will be hit especially hard by cancellations and significantly reduced bookings by rich but inherently skittish foreign tourists and businesspeople.”
A noted developer from Mumbai says that Commercial real estate which had a stellar 2019 may be in for some speed breakers as commercial real estate deals may get impacted due to travel restrictions.
Builders fear that what Jain tweeted is followed it will have a heavy impact on the real estate business. For example, if people don’t have to travel to work, they won’t mind spending less on real estate and stay at far away distances. The need of being close to work concept may disappear if not completely even remotely then too at this time when there’s a slowdown in real estate market it will be a major impact.
Commercial office spaces has been doing good in the previous year. But if foreign investments stop, then this sector will also get impacted.
“Paradoxically, this crisis comes close on the heels of the Government announcing the development of 17 new tourist sites into global-grade destinations,” says Puri.