The COVID-19 pandemic has also affected real estate investments differently. Some businesses benefited from the rise of coronavirus, while others recorded so many losses. Investors and economic leaders could share different views and opinions on the current environment. Before embarking on business, property owners must assess possible risks and benefits. This paper compares consumer-focused properties, including hospitality, retail, and mixed-use, to develop the best option.
COVID-19 led to the temporary closure of many retail properties. Also, a large percent of the hotel rooms in the United States were left vacant. The owners faced many losses since no laws were protecting them. However, the president announced new laws to protect property owners as they prepare to reopen. The laws passed by congress include indemnification and limited liability for all properties. The laws will help combat potential risks resulting from the COVID-19 and open many growth and expansion opportunities.
Saft pointed out that the issue of indemnification is important. Indemnification ensures compensation to the involved party, for example, facilities operating in California then close to engaging in class action and falling into the hands of hostile judges or juries in Alabama. The indemnification clause will compensate landowner losses resulting from uncertain events. The practice could also be applied in malls and hotels.
The hospitality industry was not adversely affected by the pandemic. The hotel industry always provides sanitized rooms and does not require significant changes. Most hotel rooms are also spacious and large enough to promote social distancing. The main challenge for the hospitality industry is the low or no occupation rates. Most of the hotels were closed as traveling and leisure activities were stopped. Saft advised that hotels should have a regulatory body that provides standard terms and conditions to approve cleanliness.
I would invest in the hospitality industry based on the three consumer-focused industries. As the economy recovers from the COVID-19 pandemic, travel restrictions will be lifted from all countries, giving many people freedom. Many people will have to book hotel rooms to enhance their safety and avoid missing flights. Therefore, the hotel industry will be crowded in that the supply will be less than demand. I will structure my hotel in regards to the COVID-19 protocols as the health ministry says, “COVID-19 is here to stay.”
The hotel will also ensure adherence to the standards of cleanliness provided by the regulatory body. Therefore, the hotel will attract massive customers for fear of contracting the coronavirus (Aharon, 2021). The hotel will also offer satisfactory and luxurious services to meet the needs and requirements of clients. Finally, the hotel will also create numerous job opportunities to facilitate economic growth and development. The investment will be beneficial for both long-term and short-term goals.
Conclusively, coronavirus has affected the real estate environment. Retails, hospitality, and mixed-up sectors were all affected negatively. As the economy resumes, investors need to investigate business ideas before making any investment move keenly. This will help them overcome the unforeseen changes which could affect their businesses. My investment decision lies in the hospitality industry as the economy reopens. The industry will attract numerous customers as the travel restrictions will be lifted.
References
Aharon, D. Y., Jacobi, A., Cohen, E., Tzur, J., & Qadan, M. (2021). COVID-19, government measures, and hospitality industry performance. PloS one, 16(8), e0255819.