December 16, 2020


David A. Wein, M.D. is the Chief of Emergency Medicine at Tampa General Hospital, System Medical Director for TeamHealth, and an Associate Professor at USF Morsani College of Medicine.


NOTE: Part 1 of this conversation covered how the U.S. government’s tiered approach to vaccinating the population could affect you and your loved ones. In Part 2 below, the discussion shifts to the implications for the economy and commercial real estate sectors including restaurants, office, and supermarkets/grocery.


Rachel Elias Wein: I have to start by saying how relieved I am that you were one of the first people to get the vaccine yesterday. What was it like?

Dr. David A. Wein: It was an ER reunion! It was great to see colleagues and have a laugh after all the challenges this year has brought. It feels good to be a part of the beginning of the end of this pandemic. But there’s more work to be done, a surge in cases and hospitalizations and still plenty of unknowns in terms of other vaccines and therapeutics. And, we’ll still need to maintain public health measures like masking and social distancing for many months to come. Happy to discuss how that impacts your industry.

REW: Absolutely. Let me just sketch out a couple of economic indicators before we talk about how vaccines could affect the economy and real estate.

One of the topics I have focused on with my clients is the way that Covid-19 has shifted spending on food. We anticipate that at least a quarter of restaurant revenue will be lost in 2020, with 50% of that amount shifting to the grocery sector.

DAW: I would imagine that is a substantial figure.

REW: You’re talking about approximately $260 billion leaving restaurants this year.

DAW: Wow.

REW: The thing is, eating away from home is about twice as expensive as eating at home, so the total gain for grocers in the United States here is really more like $130 billion. Historically, Americans eat a very large share of their food outside of the home—it was 54 percent in 2018—but when all is said and done, that number could end up declining to more like 47 or even 45 percent for 2020.

In any case, it seems to me that with a rapid, successful rollout of vaccines across the U.S. population, we could see a real boom in restaurant, hospitality and leisure travel spending next year. But that presupposes a successful effort. Do you have any concerns?

DAW: Vaccines have probably saved more lives over the past 100 years than anything else, other than maybe clean drinking water. Just think of what life would be like if, in addition to Covid-19, we were dealing with smallpox and polio. For the first time in recent memory, millions of Americans are really seeing what harm an infectious disease can do. Their parents or grandparents may remember, but Covid-19 has been eye-opening for many, many people.

It’s a powerful motivator, and I believe it will lead to widespread vaccination, especially as people start to see their friends, family and colleagues gaining the ability to safely resume normal activities.

REW: That makes sense. You can already see the pent-up demand for that.

DAW: The other thing here is to look at the numbers—the results of these Pfizer and Moderna trials.

For sake of argument, let’s say that only half of the population is willing to get vaccinated (and I’m hopeful that the number will be much higher than that). If the effectiveness of the Covid-19 vaccine were comparable to that of a flu shot—so 60 or 70 percent—then a good number of that 50 percent who received their Covid-19 doses would gain less protection than we would like. And what that could mean is that the pandemic hangs around for a lot longer.

In fact, the effectiveness rates here are well above 90 percent. If we’re able to vaccinate half the population, then we’re basically able to protect half the population. That gets us to herd immunity much faster.

REW: So from a business standpoint, it becomes less about safety concerns driving behavior and more about other factors. When we look at something like business travel, which accounts for about 30 percent of all travel, my sense is that a large chunk of that will permanently disappear. Companies are going to be looking at how much cheaper and easier it is to have certain meetings via Zoom as opposed to hopping on a plane.

DAW: I think people will be more comfortable eating at restaurants, going to the movies and fitness facilities as the level of vaccination in the population slowly rises over the course of 2021.

REW: I hope so, at the same time, I think it’s possible that we may never get back to 54 percent of food being eaten outside of the home.

DAW: Why is that?

REW: It’s very likely that tens of millions of Americans will be working from home one or two days a week going forward.

So that’s millions of meals people won’t be having on the way to the office or eating lunch at downtown restaurants. If the average American household shifts two meals a week at home, that $130 billion the grocers added in 2020 becomes permanent.

DAW: I see.

REW: And that gain for grocery is pain for restaurants. Not all restaurants will suffer. These trends clearly favor suburban over urban retail destinations, which largely benefits grocery-anchored shopping centers.

Another aspect of employment that I wrote about recently is the exodus of women from the workforce during the pandemic (“Retail’s Biggest Threat [It’s Not Amazon]”) and how that reduction in spending power will impact the economy going forward.

DAW: We’re obviously going to face a tough winter here, with lockdown orders already recurring in various parts of the country. We’ll see how it progresses nationally.

REW: Yes, but I do hope that with a successful vaccination campaign, all of the schools will be in session as normal in fall 2021, and more hospitality and leisure jobs will be in full swing. That will help restore employment among women and, in turn, benefit spending in just about every category of retail.

Rachel Elias Wein

Rachel Elias Wein is CEO & Founder of WeinPlus. Focused on the impact of consumer change on commercial real estate, Rachel serves as the principal strategic advisor for industry-leading owners and operators of commercial real estate. Additionally, Rachel is an independent director for Alpine Income Property Trust (NYSE: PINE) a net-lease retail REIT.