Simple Pleasures

We’ve had a little bit going on, haven’t we? An intense focus on struggle and crisis can have a deep effect on one’s psyche. Just ask the street cop on a tough beat or a firefighter at a busy house that deals with the depths of human misery every day.

As I write this, I sit on my back deck overlooking a nice sunset, birds chirping and all apparently well in the world. Only it isn’t. There are people suffering from sickness and sweltering economic issues. Business are failing and sadness pervades our land like a morning fog rolling on and on.

But what are we to do? Worry and anxiety are destructive emotions that lead to nowhere. If you are reading this, then you are a leader and we have a responsibility to get our own heads and hearts straight. Then we can become helpful to those closest to us. And to those who will become close. Now is a time to make friends of former acquaintances and to draw in deeply to relationships.

As George Burns said once, “If you ask what is the single most important key to longevity, I would have to say it is avoiding worry, stress and tension. And if you didn’t ask me, I’d still have to say it.”

So, as a thought experiment I reversed “virus thinking” to focus on some simple pleasures that have arisen in my life from the world’s largest work at home experiment. Here are 14 things that came to mind right away:

1)      No commute and the margin this provides

2)      The efficiency of transition from meeting to meeting…clicks instead of steps or drives

3)      A shared bond with fellow businesspeople who are also trying to figure this out

4)      All the meaningful and sometimes unexpected conversations I’ve had with so many about life in 2020

5)      Family dinners, every night

6)      Deepening relationships with neighbors

7)      Time to reflect on life and what we are all doing in it

8)      New and meaningful time with my spouse

9)      Talking with my children about really important things but also having some laughs

10)  Watching small businesspeople in my community rally to the crisis

11)  Watching neighbors in my community support small business

12)  Seeing light at the end of the tunnel on beating this sickness

13)  Admiring and thanking those in my network who are healthcare heroes

14)  Looking forward to a new and better world after Covid-19 is defeated

When people ask you how you are doing, you can certainly speak your mind. It’s OK to be honest.

But give your soul a break as often as you can and recognize that there are many simple pleasures in life. You don’t have to have fancy vacations or big dinners out to be happy, after all. Karen Marie Moning said, “It's funny how, when things seem the darkest, moments of beauty present themselves in the most unexpected places.” 

I hope you can take a break from the big bad world and focus on happy small things. Then smile.

Those in your life will appreciate it. And your psyche will as well.

12 Things I’ve Learned During the Quarantine

Staying safe on a recent hike

At the bottom of one of my recent blogs during this pandemic I shared a list called 12 things I’ve learned during the quarantine. I got a nice response back so I thought I would republish the list in a stand alone in hopes that it might brighten your day.

My learnings during the great quarantine of 2020:

1.      How to spell quarantine

2.      People say “this time is different” in every crisis. Because they are all different.

3.      Government officials can and do change their minds. Remember when masks weren’t required?

4.      Fear is more dangerous than any virus.

5.      We finally learned how to wash our hands.

6.      Getting out of your PJ’s and athletic wear and dressing for work is essential.

7.      Don’t cuss when your technology fails because we may be able to hear you.

8.      The neighbor’s lawn crew is really loud, and do they really need to come twice a week?

9.     You can be absolutely, positively sure that I am on mute.

10.  You don’t have to turn your camera on. I still respect your meme picture too.

11.  I love your barking dogs across the internet.

12.  Speaking of this crazy economy, WHAT GOES DOWN MUST COME UP.

Friends, don’t allow yourself to worry in the abstract. As my grandmother used to say, “Don’t borrow tomorrow’s trouble for today.”

We will make it through this, I promise. And I’m still on mute.

Bookmarks: 5 Interesting Articles That May Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. I welcome your comments on these articles.

1.Asking the Barber If You Need A Haircut

The saying is used in different ways for different industries. Every surgeon sees a scalpel and every contractors’ hammer is looking for a nail.

How does this apply to commercial real estate you might rightly ask? Well in at least two ways. Let’s talk about jobs first. Here are some recent headlines;

“Millions Face Unemployment and Uncertainty” – CBS News

“April Unemployment Rate Rose to 14.7%” – WSJ

“Great Depression of 2020? US Jobless is at Least 20% or Worse” – MarketWatch

But here’s the thing; this unemployment problem and the parallel economic carnage were NOT caused by financial or credit issues like the Great Depression or the Great Recession. The economy was easing before the stay at home orders were issued in March. But the real purchase point of the downturn was caused by a VIRUS that we will defeat.

So those scary headlines talking about record unemployment should be rather obvious and a little less scary with perspective. And yes, I saw the remarks by Fed Chairman Powell yesterday. His call to action is a data point and one I hope our Congress will pay attention to.

2. Push For Supply Chain Resilience, Reshoring Likely To Boost Industrial CRE

The coronavirus pandemic has left hundreds of U.S. manufacturers examining how to bring at least some of their operations and real estate footprints home.

Nearly two-thirds of North American manufacturers say they are likely to bring production and sourcing back to the continent, a new survey by industrial data and tech company Thomas shows. The company surveyed over 1,000 of the continent's manufacturing and industrial suppliers, with the help of business-to-business data gathered on Thomasnet.com.

The U.S. manufacturing sector had seen a minor return stateside in recent years, with big domestic companies like Wal-Mart and Brooks Brothers bringing some operations back to the U.S., or "reshoring.”

3. Reopening the Coronavirus-Era Office: One-Person Elevators, No Cafeterias

Welcome back to work. The corporate cafeteria is closed. The coffee makers are unplugged. And the desks are separated by plastic.

Every part of office life is being re-examined in the era of Covid-19. When employees file back into American workplaces—some wearing masks—many will find the office transformed, human-resources and real-estate executives say.

Elevators may only take one person at a time. Desks, once tightly packed in open floor plans, will be spread apart, with some covered by plastic shields and chairs atop disposable pads to catch germs. The beer taps, snack containers, coffee bars and elaborate gyms and showers that once set high-dollar, white-collar environments apart will likely remain closed to prevent the spread of coronavirus. Many changes won’t go away until the virus does.

4. Someday we’ll return to the office. It’ll be nothing like we’ve seen before

Wally Skalij / Los Angeles Times

When you finally head back to the office, it won’t be like you remember it.

Physical distancing, from the garage to the elevator to the break room, promises to help make the pending mass return to the workplace both reassuring and maddening as people learn to work together again while remaining six feet apart.

Signs of separation will abound: decals on elevator floors showing you where to stand, arrows to route foot traffic in one direction, chairs removed from conference rooms and other popular gathering places.

5. CIOs Spearhead Well-Being Initiatives to Make Remote Work Less Remote

IBM

Chief information officers are stepping beyond their traditional roles to help spearhead employee-focused mental health and well-being initiatives during the coronavirus pandemic.

After deploying the tools to support remote work, IT leaders from companies including International Business Machines Corp., Syngenta AG and SurveyMonkey now see their job as helping to manage and monitor how working from home affects a now distant workforce.

IT leaders are having more frequent, casual virtual meetings with their own teams and sending email surveys to gauge employee well-being across the company. They also are enabling the use of tools for workers to create mental-health-focused online portals and helping to ensure employees have an appropriate work-life balance.

Your success blesses others. I wish you a great a hugely impactful week!

Asking the Barber If You Need A Haircut

The saying is used in different ways for different industries. Every surgeon sees a scalpel and every contractors’ hammer is looking for a nail.

How does this apply to commercial real estate you might rightly ask? Well in at least two ways. Let’s talk about jobs first. Here are some recent headlines;

“Millions Face Unemployment and Uncertainty” – CBS News

“April Unemployment Rate Rose to 14.7%” – WSJ

“Great Depression of 2020? US Jobless is at Least 20% or Worse” – MarketWatch

But here’s the thing; this unemployment problem and the parallel economic carnage were NOT caused by financial or credit issues like the Great Depression or the Great Recession. The economy was easing before the stay at home orders were issued in March. But the real purchase point of the downturn was caused by a VIRUS that we will defeat.

So those scary headlines talking about record unemployment should be rather obvious and a little less scary with perspective. And yes, I saw the remarks by Fed Chairman Powell yesterday. His call to action is a data point and one I hope our Congress will pay attention to.

If you ask a barber, I mean, an economist, what is going to happen when we shut the whole country for months, you will get a scenario much like the one we see before us now. But listen to what two term Federal Reserve Bank Chair Ben Bernanke said in the Wall Street Journal on May 11th: “Many people are suffering, but if we’re able to get..control of the virus, the economy will substantially recover and this downturn should be much shorter that the Great Depression.”

So, look past the headlines and ask the deeper question and frankly the harder question to answer; what happens when we get back to living life in a normal posture again?

There is no doubt that hospitality, retail, travel and associated industries are going to be impacted for some years to come. I can see a big dip in those industries and then a resurgence like the phoenix arising from the ashes. The desire to travel is not satiated once the need for safety is met.

On the subject of retail and restaurants, Cushman & Wakefield’s top retail economist Garrick Brown told me we were, “The most over retailed nation in the world and soon we will be under retailed.” That sounds like an opportunity for new and different retail concepts to me. Entrepreneurs will spring into action when the coast is clear.

The large blue-collar job losses will soon be followed by an echo with more job losses in white collar industries. But once again, many metrics of consumption are way, way down. For example, Tim Fletcher, a Vice President with GenRE says miles driven are down up to 40% since the crisis began. The US Bureau of Economic Analysis says consumer spending was down 7.5% in March and I’m sure we will see the number plummet further in April. So, CFOs are doing their jobs and protecting EBITDA by cutting cost as revenues are down.

But what do you think will happen when our world of consumers starts to consume again? Yes, the jobs will come back. I realize this will take time and many individuals and families will suffer. But the economy will fix itself once the nasty virus is conquered. Oh, and the government has applied record fiscal stimulus in record time, and zero interest rates to battle the crisis.

What was your second point, you might ask?

As Cushman & Wakefield executive John O’Neill likes to say, “Those of us in commercial real estate are more relevant than we have ever been in our careers.” Real estate issues are one of the foremost issues in corporate America just now. The pause in transactions will abate and those who are working hard to build relationships will reap the rewards.

Have you heard the saying “Dig your ditches to prepare for rain?” The saying emanates from the Jewish and Christian scriptures (2 Kings 3:16) and I think it is a helpful metaphor for our situation. The armies of Israel were stuck in the hot desert and were on the verge of dying of thirst. As the story unfolds, God gave the soldiers a very strange order to dig ditches. When the rain came, it all made sense…the army needed a vessel to hold the rain. Many lives were saved because action was taken in what looked like a hopeless situation.

Friends, we can look out on the hot desert all around us think about our thirst. Or we can do whatever your equivalent is of digging ditches. I bet helping those in need and reaching out to your entire business network is the “shovel” you should use right now.

I like to say your success blesses others. When you use your professional skills to solve problems you help executives and their entire workforces. When you receive the well-deserved compensation from delivering excellent service, then your company, your family and many of those hard-up retailers benefit as well. Everyone wins when YOU win.

Let’s get to digging right. Now.

What Goes Down, Must Come Up

Is it a V, an L, a Nike Swoosh or some other “recovery” shape? I’m talking about the commercial real estate market, which as we all know, is not the stock market.

Let me start with a little story. In early September of 2008 we got the very scary news about the likely demise of the storied investment firm Lehman Brothers. I can remember the fear being palpable. I am not kidding when I say it felt like the world as we knew it was ending.

In the midst of this tsunami of bad news, I called my investment guy and asked him a simple question: Should I sell my stocks and go to cash?

He answered in an odd way. He took a deep breath and said, “Ken, do you believe the United States of America will continue to exist?” I paused and said, “Of course!” He replied, “That’s great, because if you don’t you need to buy protein bars and water. But if you do believe in our country, know the economy – and your stocks – will recover. Hold what you’ve got and just give it time.”

I reflected on that conversation a good bit last year as the stock market rallied to all-time highs. Boy, was he right.

At the recent Berkshire Hathaway annual meeting, no less than the man nicknamed the Oracle of Omaha, Warren Buffet, addressed the current Covid crisis. He said it seems unlikely that the world will face the doomsday scenarios health wise as compared to the scary models of earlier this year. The U.S. economy will recover with time, he said. “We’ve faced tougher problems and the American miracle, the American Magic, has always prevailed. And it will do so again.”

In commercial real estate, we can take a much more deliberate approach to decision making because occupier deals take a long time and require large capital commitment. Thank goodness we aren’t day traders. I think of the whole affair as a chess game where one move can impact the whole board – and sometimes with unintended consequences.

I thought for a long time about making my own forecast of what will happen in the future. Like you, I read many articles and a lot of research. I have some preliminary ideas, but there are two unfortunate realities; I’m no economist and there are SO many variables that I’m really not sure where we will be in one year. In fact, I would suggest that no one really knows what is coming as badly as we all want to.

I equate the challenge to picking the winning team in college football at the beginning of the season. You have lots of ideas, but injuries and a million other things can happen to challenge conventional wisdom.

So instead of a risky forecast, I thought I would share with you 12 things I’ve learned during the quarantine:

1.      How to spell quarantine

2.      People say “this time is different” in every crisis. Because they are all different.

3.      Government officials can and do change their minds. Remember when masks weren’t required?

4.      Fear is more dangerous than any virus.

5.      We finally learned how to wash our hands.

6.      Getting out of your PJ’s and athletic wear and dressing for work is essential.

7.      Don’t cuss when your technology fails because we may be able to hear you.

8.      The neighbor’s lawn crew is really loud, and do they really need to come twice a week?

9.      You can be absolutely, positively sure that I am on mute.

10.  You don’t have to turn your camera on. I still respect your meme picture too.

11.  I love your barking dogs across the internet.

12.  Speaking of this crazy economy, WHAT GOES DOWN MUST COME UP.

Friends, don’t allow yourself to worry in the abstract. As my grandmother used to say, “Don’t borrow tomorrow’s trouble for today.”

We will make it through this, I promise. And I’m still on mute.