“We’re probably going through a period where we’re learning more about ourselves and our businesses than at any other time,” Oxford Properties Group president and CEO Michael Turner said during his opening comment on the closing panel for the Real Estate Forum.
“We will get through this and, when we do, all of the employees we have that have been on this journey will be more valuable to us. Adversity is the greatest teacher.”
While this year’s Real Estate Forum was staged virtually on Dec. 2 and 3 due to COVID-19, it followed in the tradition of the past 28 live editions, attracting many high-level speakers and panelists.
That was very much the case with the final session, as Fengate Asset Management managing director and group head of real estate Jaime McKenna and Triovest president and CEO Ted Willcocks asked five top executives about the various ways the pandemic has affected the Canadian real estate industry.
Dealing with adversity
Canada has had a long real estate success cycle, and many younger people in the business hadn’t seen much adversity in the market prior to COVID-19. Now, with large portions of the economy having been shut down earlier this year, and with ongoing restrictions in place in many parts of the country, they’re learning how to work in a slow market and adapt to it.
Ashley Lawrence, Brookfield Property Partners’ managing director of real estate for Canada, said people at his company now have a better understanding of crisis management and incorporating health, family and work balance concerns into their operations.
“Should another crisis come, a lot of organizations will have oiled some of the pivot points in their machines so that when things happen, regardless of what it is, their organization is set up in such a way to very quickly shift, whether it’s with supply chains or people or IT.
“We’ll have highlighted where those friction points are in all of our respective organizations. It’s very important to come out of this and look back. Nobody did everything right. Sometimes it took us four months and the next time around it may take us four weeks.”
Ivanhoé Cambridge president and CEO Nathalie Palladitcheff said the pandemic has pushed her company to focus more attention on smaller tenants, not just key business partners and major tenants.
Returning to offices
“We can keep the lights on and pivot to an entirely remote environment very quickly,” said First Capital REIT president and chief executive officer Adam Paul. However, he doesn’t believe work-from-home is in the company’s best long-term interests for building culture, collaboration and creativity.
That sentiment was echoed by the other panelists. While acknowledging the future will include more workspace flexibility, they’re firm advocates for gathering people in offices.
“We own real estate,” said Choice Properties REIT president and CEO Rael Diamond. “If we’re not going to use our space, how do we expect our tenants to use our space?”
Like other companies represented on the panel, First Capital has tried to make the most of hybrid working environments and support employee mental health during the pandemic. To keep engagement and morale up, Paul said the firm has held virtual: yoga and Pilates sessions; mental health, wellness and financial planning webinars; social events; and friendly competitions.
Lawrence said Brookfield employees around the world are now almost fully back in their offices after in-depth planning to prepare for their return. This included bringing in epidemiologists and infectious disease specialists to help change office designs, paths and policies to make them more safe and cut down on the likelihood of people spreading the coronavirus.
Palladitcheff said Ivanhoé Cambridge brought in 30 students this summer as part of an internship program and asked them to provide new ideas and visions for the future of the business. Young employees also participate in a shadow advisory board to offer input.
Diversity and inclusion
Paul has signed the “CEO Pledge” in support of the BlackNorth Initiative, which is led by The Canadian Council of Business Leaders Against Anti-Black Systemic Racism and is committed to the removal of systemic anti-black barriers.
First Capital has formed an employee-led equity, diversity and inclusion council to develop long-term strategies for the company. It has also addressed these issues at company-wide town halls.
“We’re coming from a sincere place and the more we can do to communicate that internally, the more it resonates and the more traction we seem to get,” said Paul.
Palladitcheff said Ivanhoé Cambridge has appointed a head of global initiatives for diversity and inclusion.
Diamond grew up in South Africa and said diversity and inclusion issues have always been top of mind for him. Choice Properties has held sessions at which employees share experiences with colleagues and it has a diversity and inclusion council focused on education through guest speakers.
All potential Choice Properties employees are now interviewed by a panel to eliminate potential biases in hiring decisions, Diamond said.
Lawrence said Brookfield’s inclusion and diversity initiatives have been moved along more quickly this year due to high-profile incidents and racial unrest in the United States.
Basis for decision-making
The importance of environmental, social and corporate governance has also been growing, and Lawrence said it has been pushed more to the forefront this year.
“Leadership buy-in is empowering the employee base to actually execute to come up with solutions. If your employee base is that engaged with something, then it will get done.”
Diversity isn’t just important in hiring, it’s also significant when it comes to real estate portfolios — as are resiliency and sustainability — according to Palladitcheff.
“The real estate world is changing, so it’s probably better to make some small bets in different things rather than just making a big bet on something that could be different two or three years from now,” she said.
Others noted that while short-term trends can often get big traction in the media, they’re more focused on the long haul.
“Real estate is a long-term investment and we shouldn’t get caught up in short-term trends,” said Diamond.
“We make investment decisions on real estate that sometimes can span an expected time period that equals a generation, so it’s very dangerous to be making decisions based on the current environment where we’re in the midst of a global pandemic and in the eye of a storm,” said Paul.