Check out Chris Sands’ Q&A originally featured in Shopping Center Business.
Q: 2020 has been an interesting year. What properties have shown resilience during the pandemic?
A: Throughout the COVID-19 pandemic, we’ve seen resilience on properties that demonstrate daily-need concepts. Specifically within the retail sector, there has been stability within product types like fast food, grocery, gas stations, daycares, and automotive locations that depend on consumers’ essential needs. Additionally, medical offices have increased in demand and shown high probability of success and continued occupancy, and the industrial sector has continued to grow and thrive.
Q: Have you seen increased demand for STNL product throughout this year? How hard is that to satisfy?
A: Absolutely, we have seen increased demand for STNL product in 2020. With the uncertainty of viable alternative investment options, the net lease market has become an increasingly attractive investment vehicle, from capital markets to institutional investors, as well as new to sophisticated investors. Commercial real estate provides a variety of asset classes, but net lease specifically allows investors a property with low management, high probability of return, a safe yield, and all the same benefits of real estate ownership. At Sands Investment Group, our firm primarily operates with exclusive listings, and as supply increased early in the year, our proprietary marketing platform allowed us to access a full spectrum of investors within the marketplace and meet the demand.
Q: What challenges did deals face with the pandemic in 2020?
A: The challenges our deals faced were often scenarios with financial visibility — in some instances, tenants were requesting rent reprieve or abatement during the pandemic, and investors were uncertain about these tenants weathering the market. However, we continued to see many operators — especially those with essential businesses — have their most successful months during the height of the pandemic. As a buyer, confidence grew throughout the year for these product types. Similarly, the lending market initially had a cautious approach to financing deals due to the uncertainty of businesses’ durability during this time, but we’ve seen a return of appetite in the lending market going into the new year.
Q: Despite the pandemic, many net lease investment sales firms stayed busy this year. What kind of year did your firm have in 2020?
A: Sands Investment Group was very fortunate to have an exciting growth year in 2020. Our agent count increased by 78%, and our volume of exclusive listings hit an all-time high for our firm. In 2021, we’re expecting tremendous success due to our growth within the retail, industrial, and medical office product types.