Answer extracted from the The Boulos Beat: A Commercial Real Estate Podcast — listen to the full episode below.
How Did COVID-19 Reshape Maine's Office Real Estate Strategy?
COVID-19 forced Grand Metro Properties to reinvest over $10 million into a single building to keep it operational, while the post-pandemic period triggered significant tenant downsizing across the portfolio. Rather than viewing office as obsolete, George Cacoulidis recognized hybrid work as permanent reality and adapted his strategy to keep the asset class viable.
Survival and the $10 Million Reinvestment
The pandemic hit hard. One building in Grand Metro's Maine office portfolio required emergency capital injection of over $10 million just to survive the crisis. This wasn't an optional upgrade—it was a structural necessity to keep tenants in place and the building operational during lockdowns and economic uncertainty.
The reinvestment underscored a harsh truth: office assets don't self-maintain during existential shocks. Property owners who refused to adapt faced tenant departures, vacancy spikes, and value erosion. George recognized this early and committed the capital needed to preserve asset value.
The Tenant Exodus and Operational Shift
Once offices reopened, tenants began downsizing aggressively. Grand Metro experienced a 70,000-square-foot tenant departure—a loss that forced rethinking of how the portfolio could compete. One specific case involved Marshawn Eyewear Company, a portfolio tenant bought by private equity, which then acquired a 1,000-location Canadian retail company and relocated its executive team from a high-end corporate office to a warehouse.
The pattern was clear: tenants no longer needed sprawling office footprints. Space consolidation, shared services, and alternative venues replaced traditional corporate hierarchies. Owners who clung to pre-pandemic lease rates and full-floor commitments lost tenants to more flexible, lower-cost options.
As explored in this episode with George Cacoulidis, the strategic shift required operators to view office assets through a fundamentally different lens than they had before the pandemic struck.
"Don't fall in love with the building. Fall in love with the money—how is the cash flow, how is this asset performing."
George Cacoulidis — CEO, Grand Metro Properties. George is the second-generation CEO of Grand Metro Properties, which was founded by his father John in 1985. After leaving the family business to practice corporate and transactional law for 20 years, including work with motorsports clients, George returned to the firm as COO in 2015 and has since led the company's expansion across Maine and New York.
Hybrid Work as the New Normal—and the Path Forward
Rather than declare office dead, George embraced hybrid work as a permanent structural reality. This mindset shift was critical: if employees work from home 2–3 days per week but still need collaborative space for team alignment, then office demand transforms but doesn't disappear.
The adaptation required operators to rethink building design, lease flexibility, and tenant support. Smaller footprints, hot-desking, shared amenities, and month-to-month lease options became competitive advantages. Owners who stuck to rigid five-year leases and full-floor minimums struggled to attract and retain tenants.
The deeper lesson, as discussed in the full conversation, is that real estate operators who view downturns as opportunities to reinvest and adapt survive; those who treat assets as static financial instruments get trapped with vacant buildings and distressed sales.
Key takeaways
- Pandemic survival required Grand Metro to reinvest over $10 million into a single building to preserve its viability.
- Post-pandemic tenant downsizing included a 70,000-square-foot departure, with tenants shifting from corporate offices to warehouses and alternative work arrangements.
- Hybrid work became permanent, shifting office demand from full-time occupancy to flexible, collaborative space.
- Operators who adapted lease flexibility and redesigned spaces for part-time use retained tenants; those who didn't faced vacancy and value loss.
See also
What Long Island industrial property sale did a real estate investor regret missing, and how did it influence subsequent decisions?
George missed an opportunity to purchase a 250,000-square-foot warehouse on Long Island near exit 60 of the Long Island Expressway in Suffolk County when the asking price rose from $27 million to $31 million—a decision that shaped his future acquisition strategy.
How does the principle of avoiding emotional attachment influence real estate portfolio management?
George's father advised him to focus on cash flow and asset performance rather than emotional attachment to buildings. This principle shaped George's entire approach to portfolio decisions and tenant relationships throughout his career.
What competitive bidding situation in 2017 led to acquiring a South Portland office property with a major leaseback arrangement?
In 2017, George purchased 82 Running Hill Road in South Portland, an office building originally built by his brother and then occupied by Fairchild, in a competitive process that resulted in a 13-year leaseback agreement.