Nation is going to see end of lockdown sooner or later – in some places it may be lifted much earlier than others but people will be allowed to move out of the house in the coming days as the threat of COVID-19 recedes. But the biggest question in everyone’s mind will be – Whether the life would be as usual in post-lockdown world? Though it will be little premature to answer this question, the ghost of COVD-19 will haunt us in the coming days and may have an impact on how we behave both at home and in offices.
It is difficult to start construction work soon
The nationwide lockdown has brought about a standstill of building and construction activities. This coupled with the reverse migration of workers has added to the stalling of on-going projects in various states. Many interstate migrants are not expected to return to work anytime soon even with the government allowing the resumption of certain construction work since 20th April, 2020 due to the ambiguity of the duration of the lockdown and fear of contracting the virus. Migrant workers from UP and MP are already looking out for jobs in their hometowns which will have a negative bearing on the construction works especially in Western India. Further, Maharashtra state government has asked governments UP and Bihar to arrange for the transport to enable migrant workers to return to respective home states. Once the migrant workers return to their hometowns, they normally take 2-3 months to return and this time they may think of returning only after Monsoon hoping that by then the problem relating to COVID-19 would come to an end. Thus, construction companies and realtors, even if they want to commence construction activity soon, they may find it difficult to mobilise workers at the site. One may hope to see construction activity resuming only after the Monsoon season.
Some developers may also think of bringing in more automation and mechanisation in construction process to become less dependent on manual labour. However, this may happen in the medium term and that too only if cost-benefit analysis favours such a move.
Work from home may be a game changer
‘Work from home’ is likely to be the new norm for our corporate world. For example, TCS, country’s largest IT company, now believes that it doesn’t need to have more than 25% of its workforce at its offices to have 100% productivity. This would mean that 75% of TCS’ workforce could be working from home by 2025. “We have digitized virtually all our processes and invested in cutting edge infrastructure and collaboration tools to support our Location independent Agile delivery model and Secure Borderless Workspaces,” said V Ramakrishnan, Chief Financial Officer, TCS. This will give an indication of the things to come in near future. This may be followed by other IT companies too and there are several media reports indicating that work from home will become part of the corporate culture in the coming years.
Demand for commercial real estate to be impacted
IT/ITeS industry forms a major component of commercial real estate demand in India and if they shift a major part of their work force to a work from home model it will have an impact on the demand for commercial real estate. Indian commercial office sector has been on a growth trajectory with corporate expansions led space absorption attaining a peak in 2019. Major occupiers committed to large spaces to accommodate their ambitious growth plans. Net absorption in top 7 cities was recorded at 40 Mn sf in 2019, growing by 19% over 2018. This kind of growth in commercial real estate may become difficult to repeat in future. Further, in the near future, there are already early signs of weaker demand for new absorption, renegotiations of lease agreements, increasing chances of invocation of force majeure clause in commercial segment.
On the other hand, work-from-home could cause a spurt in the home renovation market. Thermal efficient and energy-saving windows would become a necessity henceforth. There is also a possibility in the increase of window air purifier systems. Closed rooms would need air exchange systems to avoid mould formation and dampness on walls.
Business style of developers may change
During the lockdown some developers and channel partners had started implementing e-site visits and e-transaction mechanisms for real estate properties and as a result many developers have reported some sales through online-mode albeit on the back of some attractive schemes as well as refundable booking amount facility provided to the home-buyers. This trend may continue even after lockdown period is over to provide comfort to the potential home buyers and also to attract buyers living in far away places, especially NRIs.
Home improvement sector to see more formalisation
Much of the home improvement market which is mainly dependent on migrant workers may also move towards formalisation. Some of the paint makers have their own home painting divisions and post-COVID-19 and post-lockdown people may prefer to use such services than employ the migrant workers directly for the job on daily wage basis. Even for other jobs like plumbing and electrical works home owners may prefer to employ specialised agencies than approach the people in unorganised market. It is usually assumed that workers from organised sector adhere to health and hygiene standards which will become the core issues for homeowners, at least in the near future.
Office & home designs may undergo change
Office and home designs too may undergo changes in post-lockdown world keeping in mind the social distancing concept. For example, global real estate consultant, Cushman & Wakefield, has designed Six Feet Office where the six-feet distance rule, which may become a new norm, is being observed. ‘Contactless pathways’, whereby employees rarely need to touch the building with their hands will become common. Motion sensors and facial recognition to open office doors, using smart phones order lifts, reminding employees of the need to for social distancing through technology, etc. may have to be incorporated in new designs.
For some, change in design, lifestyle and habits may be a precautionary measure, for some it may be fashion statement and for others it may be just a marketing gimmick. But post-lockdown may see all of them because it’s the change that keeps us alive.