This SIOR Pulse blog series connects with SIOR members across the globe to discuss business and market conditions, while discovering the current events and issues impacting their daily lives.
In this edition we connect with Bjarne Bauer, SIOR, Managing Partner of NAI Sofia Group Shanghai and an industrial and office specialist in Shanghai.
SIOR: Right this very minute, where are you working? And who or what (i.e. a pet perhaps) dictates your current work location?
Bjarne Bauer, SIOR: We’ve been back working at our offices since March. China reacted to the COVID outbreak with an early and very strict lockdown in January and February. With this approach, including a lot of testing and tracing, the virus was brought under control in China by about April and was virtually eliminated around June.
SIOR: What one change has been the most difficult to confront as a result of the COVID-19 pandemic?
BB: Not being able to travel internationally has been the most difficult aspect of this pandemic for me.
SIOR: What strategies have you used to cope with remote work and the current state of affairs?
BB: Online group chats with colleagues and more video calls have helped me cope tremendously as we have been able to stay more connected while being apart.
SIOR: How is your company encouraging collaboration and unity during these times?
BB: Our company has encouraged not only virtual meetings, but making personal connections as well. While we chat about business related topics, we also talk about private life, making plans for outings and travels for the time after COVID, sending cookie-packages to team members as a sign of care, etc.
SIOR: Have any areas of your business come to a standstill?
BB: Face-to-face meetings and property tours were not possible for a few months leading to projects getting postponed or even cancelled.
SIOR: Are there areas of your business that are still going strong? What deals have you managed to continue to push through, if any?
BB: Fortunately, we are still able to carry out a variety of deals including office leases, industrial leases, industrial sales, as well as property appraisals.
SIOR: What changes are you seeing in your market that you expect will remain after the pandemic subsides?
BB: I’ve seen an increase in working-from-home and a somewhat reduced need for physical office space by many companies, maybe an average of 80% to 90% of the current office footprint. I do expect that to continue after the pandemic subsides.
SIOR: What is your confidence level in your industry and what most keeps you up at night?
BB: I’m feeling confident in the state of our industry and in China, whose economy is growing even amid a global pandemic. I am concerned about continuous digitization which over time might make many of our services obsolete.
SIOR: What do you predict reopening businesses and workplaces to look like and what needs to happen—or what is currently happening—to facilitate that in your area?
BB: Once the vaccines proves effective, many things might return back to normal, probably in Q2 of 2021. Whether it will be the same normal as pre-COVID or a new normal, it’s hard to know just yet.
SIOR: Prior to COVID, how was the market in your area?
BB: Our market was very good for office and industrial, and very poor for retail prior to COVID. This still appears to be the case. According to the International Monetary Fund (IMF), China’s economy still grew about 2% during 2020 and is expected to grow by about 7%-9% in 2021. There was a dip in economic activity during the first half of the year, but an upswing during the second half of the year more than made up for what was lost earlier.
SIOR: How do you expect the market to look two months from now? Six months from now?
BB: I expect the market to be very similar two months, and even better six months after a vaccine is more established. I feel fortunate that things are quite fine right now.
SIOR: Are there any changes you’ve implemented that you personally hope will continue?
BB: Since the start of this pandemic I’ve worked from home more and I do plan on continuing to work more from home with more management by objective instead of micro-management.
SIOR: What has been your biggest takeaway from all of this? What’s the one thing you have learned that has impacted you the most?
BB: That things can change suddenly and fundamentally.
SIOR: If you could go back in time one year, what is one thing you would tell yourself to best prepare for this upcoming year?
BB: I would keep sufficient financial and other reserves and buffers in order to be able to weather a storm, even a long one.
Bjarne Bauer, SIOR, is managing partner at NAI Sophia Group Shanghai in Shanghai, China. He has been a member of SIOR since 2017 and can be contacted at email@example.com.