7 Ways Real Estate Has Been Repurposed During the Pandemic

From the safer-at-home lifestyle to social distancing and mask-wearing, the pandemic brought many changes to our everyday lives. Some have proven to be temporary, while others will be with us for a while, if not permanently. It makes sense, then, that the way we use real estate would change in response. So, let's look at a few ways the pandemic has changed real estate.

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At the height of the pandemic, we suddenly needed somewhere for mass quantities of people to be tested for the virus. Later, the same situation arose with vaccines. And not only did these buildings need to hold hundreds of people, but they also had to allow for some degree of social distancing. Abandoned malls and department stores filled that role nicely.

ALSO READ: Did Amazon Fail at Physical Retail?

The rise of e-commerce began many years ago, but it would be an understatement to say that the pandemic kicked it into overdrive. As a result, warehouse space has been getting hotter and hotter. Some retailers, like Bed, Bath & Beyond, are repurposing their shuttered retail spaces as e-commerce fulfillment centers to gain an edge.

The need for more life sciences space has increased dramatically over the past decade. Meanwhile, an increasing number of people began working from home during the pandemic -- and some have no plans to return. So, as offices began closing their doors, the owners of some of those spaces began leasing their properties out to life sciences companies. The future of medicine could now be unfolding where your old cubicle used to be.

ALSO READ: Life Sciences Demand Is Propelling Alexandria Real Estate

Hotels as a whole are unlikely to go anywhere anytime soon. But the pandemic and vacation rental platforms like Airbnb have come together to create some serious headwinds for the industry. Meanwhile, affordable housing continues to be in short supply. While any building can be converted into an apartment building, hotels are one of the best choices as they generally need the least amount of work to make that happen.

It's no secret that many malls have been struggling for quite a while. And, of course, the pandemic certainly didn't help matters much. Now the owners of some large mall properties are leasing out their vacant space for government and community use. So, don't be surprised if you find yourself voting or attending a civic meeting in what was once your favorite department store.

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This one may not be much of an actual repurpose, given that the purpose is still retail. But the conversion of traditional enclosed malls into open-air shopping centers is a change worth mentioning. People grew tired of so much indoor time during the pandemic. And that's inspiring an increasing number of mall owners to turn their properties inside out -- getting rid of all the interior common space and making the stores accessible only from the outside, creating an open-air shopping center.

ALSO READ: Why Open-Air Retail Is a Solid Investment

We've talked about offices closing and being repurposed. But in many fields, the office is far from dead. This is especially true in tech, where beautiful, sprawling office campuses seek to fight the remote work revolution by drawing employees together and inspiring camaraderie and creativity. In cities like Los Angeles, San Diego, and Austin, former shopping malls are being reborn as creative office campuses, colleges, and mixed-use properties combining both office and retail.

Repurposing real estate isn't a new concept. It's been done for decades. But what is new is the regularity with which we're seeing it now, and the pandemic has been a driving force behind that. For the most part, we used to expect a mall to stay a mall and an office building to stay an office building. But now, a piece of real estate can have a future as any number of different property types.

This is great news for investors because it means that if one property use is no longer working, that space can simply be transformed into something else.

Nell McPherson has no position in any of the stocks mentioned. The Motley Fool owns and recommends Airbnb, Inc. The Motley Fool has a disclosure policy.