Real Estate and the pandemic: what are the consequences?

Mar 30, 2022 | Business Insights

Anthony Efionaryi - Featured Image

A conversation with Anthony Efionayi, Head of Business Development at Zenith Guild Group. Zenith is a set of Real Estate companies operating on over three continents.

While offices worldwide have had extremely low occupancy rates during the last couple of years, our homes have become far more than just a roof above our heads. In January 2022. 55% of businesses worldwide offered flexibility when it comes to working remotely, resulting in our home also becoming our office: a development that has drastically changed our perspective of the perfect home. But, has it changed the Real Estate Industry in the long term?

Anthony Efionayi, Head of Business Development at Zenith Guild Group confirms the shift in Real Estate. Zenith is a multi-disciplinary set of companies that focus on investment and advisory across Real Estate, Renewable Energy, and Venture Capital.

Efionayi emphasizes that an increasing number of people are moving away from metropolitan areas to seek their homes inland. This is just one of the four key shifts that he’s seen in the sector as a result of the pandemic.

Real Estate Bubble
2020 – 2021 Real Estate Bubble. Source: The Economist

General key shifts over the course of the pandemic

What shifts in the Real Estate industry have you noticed over the course of the pandemic?

“The obvious shift to remote working, even if that means a hybrid solution: most people do not want to work from the office five days a week anymore. This results in more people, who historically lived in metropolitan areas, moving out of the city.

Furthermore, we are now in a globally low-interest environment. The pandemic has played into the fact that lenders are becoming more risk-averse which will ultimately result in a domino effect. This will make it harder to find sufficient credit for real estate transactions.

Another significant shift that we have noticed is the increasing demand for data centers, logistics, and distribution warehouses. We have seen this demand grow particularly with clients who work for industrial assets.

‘Retail is in a structural downturn’

On the other hand, retail is in a structural downturn that will most likely last for a further three to five years. This will result in retail properties being more segmented as the market adjusts to different buying patterns. This is based on historical recession data but the pandemic adds to the severity.”

The effects of the pandemic on multifamily housing

What are the effects of the pandemic on multifamily housing in particular? Are there any subsequent risks?

“Sales have slowed down as people have generally decided to carry on renting a property for the time being. They used the periods of lockdown or quarantine to save money. Now that restrictions are easing on a global level, we notice that many people are starting to look for ways to spend their savings. They prefer to spend their money on purchasing a property where they live as opposed to renting where they live.”

Similarly, in the months of March and April of 2020, the construction industry fell by over 25%. Only as of January this year did it recover and see a 1.9% increase from the figures in February 2020. Source: Eurostat

The long-term impacts of the pandemic on the real estate industry

What is the long-term impact of the pandemic? Is it also positive? 

“It is impossible to avoid the negative impacts of the pandemic and I believe we are still in the middle of it. We have yet to feel the full force. The question is, whether or not this will be a long downturn cycle or a short-term phase. One thing I do know for sure is that, no matter how long the negative impact lasts, the market will eventually bounce back and the industry will be stronger than ever seen before.”

How does your company adjust to new demands in Real Estate?

Strategically speaking, how does your company adjust in order to align with the pandemic’s new demands in Real Estate?

“The pandemic has forced us to change our structure and processes significantly, but with a positive outcome. We needed to seriously change our processes due to distressed opportunities from our network of investment banks, real estate companies, or surveyors requiring a different approach.

‘Our market was changing and we needed to adapt’

In terms of internal adjustments, we started a strict focus on technical implementations to streamline processes and automate certain elements of the business. We are now able to analyze the opportunities and act upon them more rapidly and efficiently.

Another aspect that is probably familiar to many business leaders, is the need to think out of the box. Our market was changing and we needed to adapt by reaching out to new partners. We have done that through targeted personalized marketing campaigns on social media platforms as well as through personalized emails.”

Similarities between the real estate market in the US and UK

Zenith Guild Enterprises operates in the UK as well as the US. Have you noticed similar changes in the two markets over the course of the pandemic?

“Although the economic situation in the US tends to be much steeper than the UK historically during previous recessions, I do not believe there has been a significant difference between the two countries during this pandemic.” 

Anthony Efionayi has been working in the Real Estate space for almost a decade. During his career, he always had a broad focus: from structural engineering to architecture; affordable housing schemes to high-end niche developments.

In recent years, Efionayi was more involved in bulk sales, real estate acquisition, and capital raising for large residences led by the Private Rental Sector, Build To Rent, and fractional sales projects throughout the UK

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