11/19/2020 | By Sarah Borchersen-Keto
A general session on the second day of Nareit’s REITworld: 2020 Annual Conference saw REIT executives, representing some of the sectors holding up relatively well during the pandemic, discuss the impact of COVID-19 on their industries and the economy, and their expectations for 2021.
Nareit President and CEO Steve Wechsler moderated the panel, which featured: Tamara Fischer, president and CEO of National Storage Affiliates Trust (NYSE: NSA); Tom Bartlett, president and CEO of American Tower Corp. (NYSE: AMT); Charles Meyers, president and CEO of Equinix, Inc. (Nasdaq: EQIX); and Joel Marcus, executive chairman and founder of Alexandria Real Estate Equities, Inc. (NYSE: ARE).
Executives commented on the state of the economy, after a strong showing in the third quarter, and the impact of potential vaccine breakthroughs.
“Macro-wise, I think it will be well into the second or third quarter before enough people have access to all the vaccines… by the second to third quarter we should be approaching a much more realistic view of taking the economy forward,” Marcus said.
Meyers noted that the full impact of the protracted period of shutdowns on the economy has yet to be seen, while Bartlett stressed the need for health and safety issues to be the top priority of the federal government and added that the response needs to be coordinated.
Fischer, meanwhile, said she “cannot overemphasize enough the need for additional government support” for individuals and businesses, noting that the impact of the pandemic on communities has been “devastating.”
Executives also discussed some of the changes occurring as a result of the pandemic.
Marcus pointed to the repatriation of supply chains in the medical and health care arenas, while Bartlett noted the significance of the growing digital divide that is creating the “haves and have-nots,” and stressed the need for increased infrastructure spending in the U.S.
Meyers said a more durable phenomenon to emerge from the pandemic is an increased focus by companies on digital transformation. He noted that companies that are better prepared digitally are outperforming those that are not as well prepared.
Bartlett noted that, in the context of digital transformation, getting the cloud closer to the edge of the network will be a critical component. Meyers added that the underlying demand drivers for digital infrastructure are “as strong as they’ve ever been.”
Meanwhile, the panelists also discussed the role of private equity in the current environment.
“It’s clearly significant. There’s a lot of money out there that’s looking for returns,” Meyers said. “There’s a tremendous amount of capital finding its way into our space.”
Fischer noted that “very aggressive buyers” have been active in the self-storage sector. “We definitely are hitting everyone’s screen who’s got capital to deploy,” she said.