Quoting Thomas L. Friedman from his worldwide bestseller Hot, Flat, and Crowded (2009), there are things we have to accept as an impact of economic development. Remember why we all accept breakfast, lunch and dinner as normal? This species did not understand what breakfast was until the first industrial revolution in the 17th century and “dinner” in the 19th century. For over two centuries, industrialization has changed our mornings and nights. 

Technological advancement in telecommunications has also changed the world. It only took less than two decades before students all over the world had to shift their learning pattern: from library geeks to internet users. I was in the Netherlands several years ago to finish my master's degree, and it was then when I saw almost no one looking for a book in an astonishing library. All they need is a desk with a power plug and a Wi-Fi password. 

Globalization has changed many things. A decade ago was the time when Nokia, formerly a tech giant, started to fail because of its inferiority compared to Blackberry. However, it was not long before everyone dumped their Blackberry for Apple and Google Android. Within less than a decade, a great company fell due to a lack of agility and, once again, technology. 

This year, we have to fully accept the impact of the pandemic. Last quarter, our economy struggled by contracting 3.45 percent year-on-year (yoy). Yet, it was better compared to the second quarter of 2020 when the contraction reached 5.32 percent yoy. 

A report from Statistics Indonesia (BPS) has also shown a notable change in our employment rate structure. This August, only 63.8 percent of our labor force were full-time workers, a decrease compared to August 2019 when the proportion was 71.04 percent. 

Moreover, the unemployment rate has worsened to 7.07 percent compared to only 5.23 percent last year. Without any doubt, some of our major sectors in the economy have been changing and might be reshaped for good, and we have to be ready for it. 

For sure, the commercial building sector is the one that got away. 

The nearly year-long pandemic has arguably made us believe that we can run the economy from home. A report from Leads Property has suggested that the occupancy rate in the office and retail sectors in Jakarta in 2021 might be as low as the current performance. 

While Jakarta is still welcoming several thousand square meters of new spaces next year, the people are getting more comfortable working out of the office. Just like the library, the internet and meeting room are the only things left from the previous "normal office life". 

Moreover, retailers also have shifted more significantly than ever. For those who sell "things", the different pattern of human mobility has changed their supply chain system, which transforms the business itself. For instance, nowadays we are really familiar with a small stall of a coffee shop for drive-thru transactions. Shoppers prefer to sip their coffee on the way to somewhere else. 

In the end, retailers only need a tiny commercial space in the center of the city. As a result, the segment of a large commercial building is transforming into another part of commercial property: the warehouse. This accelerated over the past five years when startups and online marketplaces started to bloom. 

However, the situation is surprisingly different for the food and beverage market, which also sells "experience". Our analysis has shown that the component of property rental and operational costs commonly range within 25 to 28 percent of the total cost. This is the second largest after employee salaries (37.5 to 39 percent). Strategic location is very important for this type of restaurant, and the pandemic has been as challenging for them as it has been on the tourist industry. With strict regulations on maximum capacity and business hours during the pandemic, it is difficult to expect revenue to return to normal anytime soon. 

The property sector is in a vulnerable position, especially offices and big shopping centers. A survey from Knight Frank (2020) of the top 160 global property developers has told us that 77 percent of them chose "advanced technology" as their primary focus to develop in the coming years. More than that, 75 percent chose "space for home office" as their secondary focus. 

Our developers need to think about this more thoughtfully by introducing more spaces, healthy environments and updated technology because the crowd will not be the best proxy to define success.

First, developers need to be more focused on revamping existing buildings. Hence, quality improvement is believed to be more beneficial to the market compared to building something new in the peripheral. The objective is clear: Humans need advanced technology. 

With this agenda, we believe any collaboration with a good designer and reliable ICT companies might be as important as a good partner on building construction.

McKinsey (2020) predicted in its report The High-Rise in 2030 that all building management needs to treat property as a "human center" that offers flexibility and is less boring. A dedicated building only for office space will be dead. Next decade, every modern professional will demand a complete space: residential, office and even hotel space all in one building. 

It is important for the government and the banks to understand this since the transformation is never easy. Dedication and proper allocation of time and budget are really important; not to reconstruct commercial buildings but for the behavior of the people. Developers might need help from financial institutions for funding since this is not only about construction but also establishing a new standard of commercial property. 

Last but not least, archives have told us that technology always brings new reactions to human beings, and the trend is moving faster. We have to think now and be prepared very soon, otherwise commercial property in the future might not be as fruitful as we expect it to be.