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Colliers Breaks Down COVID-19’s Impact on Puget Sound CRE

COVID-19 has hit the Puget Sound harder than any other metro in the United States, and the number of cases continues to grow in the Pacific Northwest’s other large metro area, Portland. New research by Colliers International predicts long-term impacts on commercial real estate will likely include increased janitorial expenses, as landlords realize the importance of proactive hygiene.

One practice being already adopted by some companies is implementation of remote-work policies. As supply chains are disrupted, there will be ripple effects felt throughout the U.S. and global economy for months to come, notes Colliers.

Colliers’ Jacob Pavlik also wrote in the report, “Given the limited spread of COVID-19 in the United States, the disruption to real estate will be limited to significant concern on an individual level and uncertainty on an institutional level more than actual health risks. In Seattle, F5 Networks closed its 516,000 square-foot office tower in downtown last Monday for in-depth cleaning, after it learned an employee came into contact with someone who tested positive for COVID-19.”

Depending on the spread of the virus, more building closures like this could take place as companies work to ensure health and safety for their employees, observes Colliers. As a precaution, Nike closed its world campus headquarters outside Portland last weekend for a deep cleaning as well.

The industrial market will likely be most impacted over the long-term, predicts Colliers. Supply chains are already experiencing disruption, as Seattle-based Amazon warns of longer delivery windows for its Prime Now and Amazon Fresh services, in addition to halting all non-essential travel, domestically and abroad.

Portland and Seattle are heavy port cities, and Colliers’ Pavlik notes they have a lot to lose from China’s quarantines. Oregon exported $4.7 billion of goods to China in 2018. A vast majority of those are from Intel in Hillsboro, but it also included agricultural products and apparel, as well. Seattle is even more dependent upon China for trade, with 14% of all U.S. exports to China coming from the state of Washington. King County alone exports $5.9 billion in merchandise and commodity sales, primarily related to the aerospace industry.

In the coming months, companies based in the Portland metro and Puget Sound regions are expected to feel the impacts of COVID-19 beyond any limited health risks. Despite China’s factories beginning to open again, there will be changes to supply chains globally that will likely impact demand for space in the Portland and Puget Sound markets, predicts Colliers’ Pavlik.

Connect Media hosted a CRE and Coronavirus webinar on March 11, 2020. Commercial property leaders shared insights on proactive precautions they are taking to prepare properties for the COVID-19 threat. You can listen to the webinar on this link.

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For comments, questions or concerns, please contact Dennis Kaiser


Inside The Story

About Dennis Kaiser

Dennis Kaiser is Vice President of Content and Public Relations for Connect Commercial Real Estate. Dennis is a communications leader with more than 30 years of experience including as a journalist and in corporate and agency integrated marketing communications roles. He is responsible for Connect’s client content operations and public relations strategy. He is involved in a range of initiatives ranging from content strategy, message development, copywriting, Social Media and content marketing services. Dennis’s communications background in the real estate industry includes working with many of the top real estate firms – from brokerage companies, developers, homebuilders, investors, owners, lawyers, asset advisors, lenders, architects and property management firms. • Marketed more than 1 Billion Square Feet of Office Space • 70,000 Multifamily/Condo Units • 15,000 Single Family Homes • 30 Million Square Feet of Retail Space • Representing Roughly $100 Billion in Investment In his most recent corporate communications roles, he led a regional public relations effort across Southern California for CBRE, played a key marketing role on JLL’s national retail team, and was responsible for directing the global public relations effort at ValleyCrest, the nation’s largest commercial landscape services company. Dennis’s agency background on integrated communications teams at many reputable agencies and has earned an outstanding reputation with organization leaders as a trusted advisor, strategic program implementer, consensus builder and exceptional collaborator. He formerly was President of the Public Relations Society of America’s Los Angeles of public relations professional, and served on the Board of Directors. He also taught a public relations extension course at Loyola Marymount University. Dennis’s has developed and managed national communications programs for Fortune 500 companies to start-ups, both public and private. He’s successfully worked with journalists across the globe representing clients involved in major-breaking news stories, product launches, media tours, and company news announcements.

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