4 KEY SECTORS: WHICH FUTURE AFTER COVID-19 PANDEMIC ?

Nowadays futurists are trying to figure out which scenario we'll have to face in terms of daily life, social behaviours, education, business, economy, public services. In other words, how things will change in consideration of the lesson given by this dramatic pandemic.

In particular, during the last weeks I had the time to brainstorm about the near future of 4 important chapters of our life and economy:

MOBILITY - EDUCATION - REAL ESTATE - HOSPITALITY

But firstly, I would like to underline an important aspect, recently reported by the "Washington Post", which in my opinion is absolutely right: even if we'll have available effective cures and maybe a vaccine, the novel coronavirus will likely remain for decades to come, circulating among the world's population (becoming endemic). In fact, there are already four endemic coronaviruses that circulate continuously, causing mild illness such as the common cold. Many experts think this 2019 virus will become the fifth, with effects growing milder as immunity spreads and our bodies adapt to it over time.

I take this concept as a postulate for the most probable scenario that will be originated as a direct consequence of this pandemic, among 4 key sectors of our life and economy.

1. MOBILITY

Before this pandemic, most of concerns were related on how to make public and private mobility more efficient, cleaner, smarter. In particular, the concept of "shared mobility" has been always considered a must. Any traditional public transport vehicle is basically a shared vehicle (metro, bus, airplanes, taxi, water taxi) with dozens, or even hundreds of passengers jumping in and out on a daily basis, with extremely reduced social distance.

Furthermore, during the last years we have seen the growth of new business models, such as "car sharing" and "Uber-style" services, based on sharing of private vehicles (with or without driver). Now, after this pandemic, many concerns are surging about the sanitary safety offered by all these shared vehicles. In particular, will the new "shared private mobility" models disappear? Or do they just need to be better regulated, through proper mandatory sanitary protocols?

I believe that all the involved mobility stakeholders and regulators should urgently develop new sanitary protocols for any kind of public transport vehicle, granting everyone to use a shared vehicle with 100% peace of mind. It will add some cost, if the operators will be required to apply stringent sanitary protocols. But there is no other way. For this aspect, I suggest to focus attention to: onboarding - outboarding procedures applying social distance, revise seats distance where possible, apply temperature sensors, introduce dispensers of sanitary products into the cabins, apply frequent automatized cleaning cycles into the cabins (using non-toxic products, implementing UV rays and Ozone), apply frequent cleaning to the centralized climatization systems, increasing air suction ratio towards the ceiling.

In order to grant the application of all protocols, I believe of some sense to introduce a new professional figure into any large public transport vehicle, being responsible to check and certify the application of the daily protocols filling a "Vehicle Sanitization Register". It can be a software application easy to fill up, storing the daily data into the operator's server, containing the check list of actions, as per introduced protocols. In the case of smaller or "Uber-style" vehicles, the drivers shall play this role under their own responsibility. In the case of "car-sharing" companies, the sanitization procedures shall be applied among any station using dedicated operators, when the car checks-in and going to be sanitized prior to deliver the car to the next user.

I expect in any case a reduction of commuters particularly among the urban areas, due to the increase of "smart working" technologies. We have seen during these worldwide lockdowns that many employees had the possibility to work from remote. This trend will remain in place for several tertiary sectors and for certain employee's categories, reducing the volume of commuters and also having positive environmental effects across the main cities (less traffic jams, less carbon emissions). Maybe some public transport authorities will be in condition to reduce the current public transport fleet, or at least upgrade and optimize it to the new regulations, instead to invest in the extension of the fleet itself.

2. EDUCATION

How can we face the new academic year, granting a 100% safe environment for millions of students? Any school or university has been designed without taking into account social distancing: classrooms contain dozens of students sitting very close to each other.

So, apart of the obvious increased sanitary protocols (frequent cleaning to floors, furniture, bathrooms, laptops, etc...) I would suggest the introduction of the School's Sanitary Officer. This new professional role shall be responsible of the application of the daily protocols, all to be reported into the "School's Sanitary Register".

In terms of behavioural measures, I suggest to apply separate access ways, one for students, one for visitors and last one for employees. Thermal scan should be applied into all the 3 access lines. In the common areas (lobby, coffee areas, food courts, library, gym) should be applied social distancing.

For the elder students (high-secondary school and universities) could be applied a 50% of classrooms at school, and 50% via online classrooms. In this way, we avoid to "alienate" students leaving them alone at home all the time. This protocol will allow school to apply social distance. Example of a classroom of 30 students: The first group of 15 students goes to school on Sunday, Tuesday, Thursday, and other 3 days will conduct online lessons. The second group of 15 students conduct online lesson on Sunday, Tuesday, Thursday, going to school on Monday, Wednesday and Saturday. This strategy allows school to host 15 students instead of 30 into the classroom, applying certain social distancing without spending money for drastic changes of classrooms' layouts

But of course, this will require for the schools to develop proper online platforms, maybe hire some more teachers handling the online lessons. In other words, shifting education model towards a "smart education" concept which in any case was already a growing sector. Let's say that this pandemic will push traditional organizations to speed up certain processes that the education sector in any case will have to pursue.

Of course, the big problem here is for the younger students (kindergarten, primary school) who cannot be left alone at home, because this will imply a social issue as the parents have to go to work. For these younger categories, I believe it will be needed a reduction of students for each classroom, obliging school to revise the classroom layouts, or at least to carefully study how to alternate lessons and activities indoor and outdoor. For example, while half classroom is doing lesson indoor, other half is doing outdoor activities, or using gymnasium, or conducting some library activity, etc. This will probably require to again increase the number of teachers.

In terms of "indoor air quality", I suggest all schools and universities to clean and eventually refurbish/replace chillers and filters, in particular setting the system in order to secure an higher air recirculation (vol/h) among all the school's areas, increasing the % of external air in the mix. The more we diluite indoor air with external air, the more we reduce the risk to recirculate viruses and bacteria. This will cause an increase of energy required for cooling, but in any case modern conditioners are more efficient than older. I also suggest to implement automatized sanitization processes, such as UV lamps and ozone spreaders.

3. REAL ESTATE

The residential real estate market probably will change a bit, after this pandemic. Main reason is the increase of smart working. If many people will continue to work from home, most probably the requested average flat size will increase a bit, offering an extra space to set up the home office. Also, working in remote means less importance to live centric and close to the office or close to metro stations. So, I expect many people going to buy or rent a bit larger units, but less centric (cheaper) offering additional room, and esternal areas. Last but not least, the bad experience of lockdown gave a priceless value to residential units having balconies and gardens. Whoever has spent 2 months locked into a small apartment with no balcony nor a small garden, knows what I am talking about. So, the decrease of requests for small centric units may affect the revenues of most of real estate investors, which since now have considered those kind of centric and small units the most profitable in terms of annual revenues coming from rental.

Concerning the office real estate market, the extended application of smart working could drastically reduce the average size of corporate offices. In this case, we may expect many companies to cut their own budget at the voice "office rent", since they plan to implement smart working on a long term basis. In the short and medium term, this can severely affect this kind of market, with many companies resigning the current contracts and shifting their corporate offices into smaller spaces. Furthermore, we have to consider that this pandemic will leave around a massive economic crisis for at least 1-2 years, this means most of the companies will cut budgets, reducing workforce and again cutting rental costs.

Industrial and logistics companies will need to apply proper sanitary procedures and social distancing. But here the mayor problem is caused by the generalized crisis of demand expected for the next couple of years, due to this pandemic. It will affect all industrial and logistics fields, therefore the related real estate market (warehouses) will suffer a deep market contraction.

4. HOSPITALITY

Hospitality will not face great times for the next couple of years. World crisis means less tourism. All hotels and tourism structures in any case will have to invest into additional sanitary protocols, which will increase annual costs against lower revenues.

Many small firms and single hotels will probably shut down, affected by the prolonged lack of revenues. Between them, the good ones offering strategic values will be absorbed by large brands, upon bargain deals.

Large brands will invest a lot in marketing and communication, explaining how they apply strict sanitary protocols in order to offer sterile rooms and aseptic environments, trying to gain guests' trust. Obviously, the small organizations affected by lack of revenues will have not enough resources to do the same. We can suppose this situation will originate further centralization in the hospitality industry, making the large ones stronger, and killing the small ones.

Hotel marketing will have to reinvent priorities, finding pleasant ways to promote the fact that their own structures are safe and clean all the time. I advocate large brands to invest into new professional figures or prepare their current Facility Managers and Housekeeping Managers to apply proper sanitary protocols, keeping detailed "Hotel Sanitary Register". Last but not least, I would recommend to implement automatized sanitization methods across the facilities and into the rooms, particularly UV lamps and ozone spreaders, regulated by several automatized cycles per day.

Concluding, the more recent and innovative hospitality formulas based on private units (such as AirBNB, multiproperties and short-term rent) will face huge contraction. The "shared housing" concept doesn't offer for now proper peace of mind in terms of sanitary aspects. It will take years to come back to the pre-pandemic levels.

I hope my thoughts may inspire colleagues and decision makers to discuss further about the 4 above topics.

All the very best

David Provenzani

[email protected]