Distribution and administration of the new COVID-19 vaccine is already underway, and while a majority of people are grateful for this breakthrough, there remain some who are skeptical. Many have questions about its efficacy and ability to turn the pandemic around. For his own part, Cambridge Realty Capital President Jeffrey Davis is thankful for a vaccine that came in record time: “Not too soon and not soon enough!”
Davis and other Cambridge staff have had a front row seat to watch from as the COVID-19 pandemic ravaged the skilled care/senior living industry. Nursing homes were the first institutions to be hit hard and fast by the COVID-19 virus in the spring of 2020. Facilities across the US reported multiple infections and deaths of both residents and staff. The pandemic left operators scrambling to come up with enough PPE for staff and filling vacancies for staff who were sick. “There was a new normal, and that new ‘normal’ changed almost daily,” said Davis.
Now with multiple vaccines already being distributed, “normal” has yet again been re-defined, and has raised a myriad of questions about how the vaccine will be distributed so that it is eventually made available to every single individual in every community, how politics will be kept out of its distribution, how the vaccine will be received among the general population and whether the rate of acceptance of the vaccine will be sufficient to create herd immunity. It also raises questions more specific to senior living and commercial real estate, such as how senior living stakeholders can ensure that their staff and residents have timely access to the vaccine, how they will remain safe in the meantime, and the long-term effects these last months will have on commercial real estate going forward.
Currently, two different COVID-19 vaccines have been approved for use: one developed and manufactured by Pfizer, the other by Moderna. Both work in different ways and both have been deemed to be 95% effective. Both vaccines require two doses, the second within weeks of the first. The vaccine has already started to be administered, but it is expected to take several months before it is made available to everyone in the US.
Even when it has been widely distributed, it is likely that protection measures such as the wearing of masks and social distancing may still be necessary for quite some time. Part of the reason is that it may take time for individuals to develop full immunity after receiving both doses of the vaccine. It is also possible that an individual may become immune to the virus themselves but still be able to carry it and pass it on to others who are not immune. It is also a given that there will be people who will refuse the vaccine. It has been estimated that approximately 60 to 80 percent of the population must be vaccinated in order to achieve herd immunity. If too many people forgo the vaccine, herd immunity cannot be achieved, and the virus will continue to proliferate. There are also some unknowns regarding the vaccine’s effectiveness against new variants of the COVID-19 virus, including the variant coming out of the UK as well as any new variants that are almost certain to appear in the future.
Senior living operators can take some comfort from the promise that the country’s seniors will be among the first groups of people to have the vaccine made available to them. They will follow shortly on the heels of those who care for them (nurses and other senior living care staff), doctors, nurses, first responders and other medical professionals. The hope is that even if outbreaks continue to occur in communities across the US, America’s seniors will remain safe.
Even so, it may take some time for life to return to normal in America’s senior living facilities. “So many aspects of life in these facilities have been affected, from communal dining to being able to get together with family members.” It may be months before members of the public will be allowed inside these facilities again, and health checks of visitors to SNFs may become the new normal as we head into the future. “How we get to the new normal will not be easy, but it will come and will be a major relief to all families, staff, and residents,” Davis added.
If there is any silver lining for the commercial real estate industry, it is that interest rates are likely to remain low for quite some time. Federal Reserve Chairman Jerome Powell all but promised as much, and this is providing at least a small measure of peace for commercial real estate stakeholders.
Davis also noted that not every real estate-related industry was affected the same way by the COVID-19 pandemic. “Some have fared well,” he said. They include multi-family housing, datacenters and logistics hubs, self-storage, mini-warehouses and warehouses. And while most retailers were hit hard by the pandemic, many grocery stores and their suppliers thrived as they were deemed essential and allowed to stay open in most locations across the US while most other retailers were closed.
“The delta between being impacted and not being impacted is huge,” Davis pointed out, “as the sectors that have not been impacted have generally been doing business as usual, with a few minor variations, and the sectors that have been impacted have been spending a tremendous amount of time trying to create an environment that works for the building day to day. Unfortunately, the sectors that have been impacted will require significant capital improvements and increased patience to essentially function, and it will take several years for some of the sectors to return to their normal prior to the virus.”
For its own part, Cambridge Realty Capital has flexed with the changes. Most of Cambridge’s staff have been working from home over the last several months. While they cannot simply pop into each other’s offices for a chat anymore, they’ve managed to find ways to stay in quick communication with one another and keep business moving in a timely manner. Communication with clients has largely taken the form of phone calls and web chats rather than in-person meetings. “Our clients have been very understanding, and I am extremely grateful to our staff for their flexibility and commitment during this time,” Davis said.
He went on, “As new virus waves are impacting everybody, we can only begin to imagine how life will be after the vaccine has been fully implemented,” Davis commented, adding that he is thankful that science was able to make so much progress in such a short time. Although there are still many unknowns, Davis believes that the world has turned a critical corner in the fight against COVID-19. “We’re not out of the woods yet,” he stated, “but now there is a light at the end of the tunnel. Hopefully, we can focus on each day and be as positive as possible toward the change’s forthcoming and the new normal.”