The coronavirus has thrown many of the expectations for the economic output of this and the following year into the unknown. Every sector is hit and experts struggle to make predictions in a constantly changing environment. The sector of Industrial and Logistics Properties is also experiencing headaches. Three leading professionals from Savills UK, a global real estate services provider, try to bring some clarity into the conversation.
READ: Covid-19 Fastforwarding Negative Economic Trends
No one knows how long the current situation will go on and what the lasting impacts will be, admit Sally Duggleby, Chris Earle and George Unwin from the Industrial and Logistics team at Savills. All three of them find it hard to predict with certainty how the sector is transforming because of COVID-19. Sally Duggleby, head of Industrial & Logistics Occupier Advisory, explains that…
…in recent weeks more companies are looking for short-term spaces they can rent in order to fulfill e-commerce and grocery orders.
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With the rise in panic buying it is getting harder for large retail organisations to deal with the demand online. Ocado, British online-based retailer, has frozen all new orders for a period of time in order to find a better way of responding to the demand. Other brick-and-mortar stores like Tesco are also seeing unprecedented demand across their online and physical infrastructure. ‘We cannot predict what will happen in retail,’ explains Duggleby.
Earle and Unwin, directors in the industrial and logistics occupier advisory team, echo what Duggleby says. They add a perspective on labour and what may happen to workers and jobs. As many restaurants and retail shops were struggling way before the current outbreak the experts think jobs could shift from retail to logistics.
It is likely to see 3PLs hiring more people who have a job in retail as positions are being opened and demand for skilled and unskilled labour is increasing.
Another piece of positive news is that so far companies have not been deterred from keeping up their investments and plans going.