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Is Office Demand on the Rise?

Posted on December 29, 2017

The NAIOP Office Space Demand forecast has shifted upward to above 10 million square feet of absorption in 2018, said Dr. Josh Harris on the recent exclusive NAIOP member webinar on what's shaping office space demand. What's the outlook for the U.S. economy and what does it mean to you? Find out in the full archived webinar. 

Click here to view the webinar.

Industrial Shift: The Warehouse as Profit Center

Posted on December 28, 2017

Written by Paul Briggs

With retailers pivoting to better serve customers both online and in stores, an important shift is underway in the industrial real estate sector. Warehouses, historically viewed as cost centers where goods sat waiting to be shipped to a store, are evolving into profit centers that help retailers maximize revenue and differentiate from their competition. With strategically-located fulfillment centers, retailers can get goods into the hands of impatient consumers faster. Warehouses located closer to customers also make it easier to attract workers to fill the abundant fulfillment job openings.

This shift has fueled tremendous growth in warehouse demand and rents. The resultant value creation has generated the potential for superior investment performance in comparison to other major commercial property types over the past five years. Anticipating continued strength, investors have bid cap rates down to new lows.

Click here to read the full article.

U.S. House Approves Brownfields Legislation

Posted on December 27, 2017

On November 30, 2017, the U.S. House of Representative passed H.R. 3017, the Brownfields Enhancement, Economic Redevelopment and Reauthorization Act of 2017, which would allow up to $250 million annually to clean up brownfield sites during 2018-2022. The legislation, sponsored by Congressman David McKinley (R-WV), seeks to assist communities in restoring the contaminated land to productive use.

Click here to read the full article.

Ride-hailing Becomes a CRE Amenity

Posted on January 2, 2018

Written by Camille Galdes

Transportation demand management strategies, which increasingly include ride-hailing services, have evolved from a negotiating tool to an amenity.

In just a few years, ride-hailing services have revolutionized how people move around in their daily lives. According to a January 2017 Business Insider article, in more than 500 cities around the world, anyone with a smartphone can now call an Uber car to their location. Similarly, Lyft reaches people in 300 cities across the U.S. These tech-savvy companies allow users to request and pay for rides straight from their phones, enabling users to pick up rides on the go that usually cost less than local cabs. Now that ride-hailing is nearly ubiquitous — and “uber” has become a verb — developers and property managers are increasingly using these services to boost the profile and profitability of their properties.

Click here to read the full article.

Ports and Intermodal Development: Critical Links in the Supply Chain

Posted on December 26, 2017

The volume of world trade has exploded – along with the need for expanded intermodal infrastructure. Examine best practices for building a smooth and efficient supply chain that operates between seaports, railroads and business parks in this session recap from CRE.Converge, and download the full presentation on the conference resources page.

Will Office Densification Continue?

Posted on December 21, 2017

Has densification of the office environment reached a tipping point? Yes, say research directors from national real estate brokerage, data and investment firms, whose consensus is that on the whole, office densification is either approaching or has already reached a tipping point, as most of the larger office space users have already downsized and the smaller ones that are left to downsize are not expected to move the market.

Click here to read the full article.

 

The Forces Shaping Office Space Demand

Posted on December 20, 2017

"Clear sailing ahead," says Dr. Mark Dotzour on an economic outlook for 2018, kicking off a recent NAIOP webinar on the economy and what's driving demand for office space. This longest economic expansion since World War II – nine years and counting – is showing no hint of a recession, thanks to job creation and rising wages and consumer confidence. Listen to the full archived webinar, a NAIOP member benefit.

Listen to the webinar here.

Victory for CRE in Tax Reform

Posted on December 19, 2017

Last Friday, House and Senate negotiators came to an agreement on what is sure to be far-reaching reform of our existing tax code. The Tax Cuts and Jobs Act will be voted on this week and is expected to pass and be signed by President Trump.

This legislation, when passed, represents an important victory for NAIOP members and the commercial real estate industry. For many years, the debate surrounding tax reform gave rise to ideas that would have caused long-term damage to our industry, including the elimination of 1031 like-kind exchanges, ending capital gains tax treatment for real estate carried interests, and not allowing deductibility for interest payments on the financing for real estate projects.

The active involvement of NAIOP members and NAIOP's legislative team in this important public policy debate helped shape the final product to ensure that commercial real estate remains a vibrant contributor to our nation's economy. This tax reform legislation will:

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Mecklenburg County Hopes to Have POSSE System Back Online This Week

Posted on December 18, 2017

In the wake of last week’s cybercrime attack, Mecklenburg County is continuing to make progress on restoring permitting systems to full functionality. LUESA is running tests on the POSSE system today, and pending those results, is hoping to have it back up and running by tomorrow or Thursday.

LUESA director Ebenezer Gujjarlapudi told REBIC today he is confident that no plans or review comments were lost during the hack, so the department should be able to pick up where they left off once everything is back online.

Code Enforcement has been averaging about 1,000 inspections a week since the system collapsed, so they don’t expect there will be much (if any) of a backup once the system returns to normal. In addition, the County says they’ve had a number of on-schedule reviews completed this week using the paper process, and once the system is back up, they’ll contact all customers in the queue to let them know how they’ll be proceeding with their scheduled reviews. Again, they seem to expect a minimal disruption.

Click here to read more.

Applications Now Open for NAIOP's National Forums

Posted on December 12, 2017

The Forums provide a unique opportunity for members to openly discuss project challenges, business opportunities and lessons-learned in a confidential and non-competitive setting. Over time, fellow members become a trusted circle of advisors.

The National Forums are an excellent way to become involved, stay in touch and develop new connections with key industry leaders.

The application period for the National Forums is now open. Create an account and apply using our online tool — applications are due by February 2, 2018. Notification of appointment will be emailed and followed by letter.

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Trends and Opportunities in CRE

Posted on December 11, 2017

Written by Susan M. Phillips

Want to predict the next real estate correction? When more than a quarter of all commercial real estate job openings are in property and asset management and acquisitions and development decline to less than 10 percent of all real estate jobs, it is a sign that the foot is coming off the gas pedal.

The third quarter saw overall commercial real estate jobs follow the U.S. job market and decline slightly, yet property and asset management jobs were up significantly, says the SelectLeaders Job Barometer. “Real estate asset prices have surpassed their prior 2007 highs, and employers are pulling back on growth-oriented hiring and instead building out their property and asset management capacity,” said Dr. David Funk, SelectLeaders chief economist, noting, “our Employment Cycle model is not yet predicting a correction, and cautious optimism could continue to rule the day but clearly there is a move to property management and corporate real estate hiring.”

Click here to read the full article.

A message from NAIOP’s Legislative Team

Posted on December 8, 2017

NAIOP's legislative team is committed to keeping you informed throughout this historic tax reform legislative process with progress updates and what the legislation means for the commercial real estate development industry.

The Senate has taken a significant step toward achieving comprehensive tax reform by passing its version of the Tax Cuts and Jobs Act. This week, the House and Senate will meet in conference to iron out the differences between the two versions.

Both the Senate and House versions of the bill include matters important to our industry, including:

  • Maintaining Section 1031 like-kind exchanges for real estate.
  • Maintaining the deductibility of interest on debt for those involved in real property trades or businesses, including CRE development.
  • Preserving capital gains tax treatment of carried interest for real estate practitioners, but requiring that assets be held for three years or more. Senate amendments that would have eliminated capital gains treatment for carried interests completely were defeated.
  • Reducing corporate tax rates to 20 percent from the current 35 percent, not taking effect until 2019 in the Senate proposal.
  • Limiting state and local taxes deductions to property tax and capping it at $10,000; the original Senate proposal would have eliminated it completely.
  • Doubling the estate and gift tax exemption levels (with inflation adjustments) from the current $5.49 million for individuals or $10.98 million for married couples.  The Senate version would not completely repeal the estate tax; the House version phases it out entirely by 2024.

While the Senate amended its original version to bring it more in line with provisions included in the House bill, several important differences remain, including:  

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2018 REBIC Forum with the Honorable Mick Mulvaney

Posted on December 6, 2017

Join REBIC for an exclusive conversation with Mick Mulvaney (Director of the White House, Office of Management and Budget and Consumer Financial Protection Bureau), who will discuss the President’s vision for federal Tax and Regulatory Reform, and how it will impact the Real Estate Industry.

Tuesday, January 16, 2018
8:00-9:30am
Quail Hollow Club
3700 Gleneagles Rd, Charlotte

Cost is $25, breakfast will be served.

Click here to register.

Self-Driving Carts Put to Work in Warehouses

Posted on December 1, 2017

Boxed Wholesale believes self-driving carts can be used to navigate through warehouses and pick products, according to an article in DigitalCommerce360.com. Boxed, a web-only merchant that sells primarily household goods, initially plans to use fully automated carts to shuttle goods between picking and packing human warehouse workers. “Long term, we’re aiming to expand the functionality of the vehicles to complete other warehouse tasks that can be made more efficient,” says Will Fong, the retailer’s chief technology officer. “For example, rather than sending a human to restock a picking zone with paper towels, the vehicle could soon be able to recognize the need to replenish the product and complete the task, all without humans needing to get involved.” A Boxed in-house team of two engineers developed the autonomous cart in 90 days. Boxed first added the carts to its warehouse in Union, New Jersey, and plans to add them to fulfillment centers in Dallas, Las Vegas and Atlanta.

Inside WeWork's Communal Housing Project: WeLive

Posted on November 30, 2017

A recent article in Bloomberg Technology, What Life is Like Inside WeWork’s Communal Housing Project, profiled WeLive apartment living to see if the shared common space apartments could reinvent rental housing the same way WeWork has changed office space. WeLive provides fully furnished apartments in the same building as WeWork’s shared office spaces. In the common areas, residents can “cook dinner in an expansive kitchen, shoot pool in the laundry room or get neighborly over free WeWork-provided cocktails on the seventh-floor roof terrace.”

WeLive debuted last year in Washington, D.C., and New York and was expected to have almost three dozen WeLive locations by the end of 2017, but still has only the two original locations. Tenants have been slow to lease, according to the article, because the apartments are as expensive as similar studio units on the market and the communal “dorm for adults” aspect is not appealing to everyone. Those interviewed for the story appreciated the networking and instant social life WeLive provides but several conceded that their units were temporary places to call home until they found something that felt more permanent.

New Construction Starts in 2018 Increase to $765 Billion

Posted on November 29, 2017

According to Dodge Data & Analytics’ 2018 Construction Outlook, construction starts will climb 3 percent to $765 billion in 2018. The growth of the construction industry will continue into 2018, but some product types, such as multifamily housing and hotels, will see less activity. Single-family housing, office building, warehouse, transportation terminal, school and health care facility construction will continue to grow during 2018.

“Overall, the year 2018 is likely to show some construction project types register gains while other project types settle back, with the end result being a 3% increase for total construction starts. By major sector, gains are predicted for residential building, up 4%; and nonresidential building, up 2%; while nonbuilding construction stabilizes after two years of decline,” stated Robert Murray, chief economist for Dodge Data & Analytics. He predicts single-family housing construction starts will receive a modest boost from post-hurricane rebuilding efforts in Texas and Florida.

Confidence in the Availability of Debt and Equity Captial Keep NAIOP Sentiment Index Positive

Posted on November 28, 2017

Release Date: Fall 2017

Download the Fall 2017 NAIOP Sentiment Index Report. 

About the NAIOP Sentiment Index

The NAIOP Sentiment Index is designed to predict general conditions in the commercial real estate industry over the next 12 months. The forecast is not based on an analysis of historical data, but rather it represents the outlook of commercial real estate developers, owners, and investors. These NAIOP members are asked to respond to questions based on their ongoing work, including projects in their pipelines. For more information, see Understanding the Index.

Click here to read more.

Denver: Green Roofs Now Required

Posted on November 27, 2017

According to an article in the Denver Post, downtown Denver is about 5 degrees hotter than surrounding areas in the summer due to the heat radiating from concrete rooftops and pavement. Denver ranks third in the country for the severity of the “urban heat island” effect — described as a phenomenon that increases air conditioning use and worsens air quality.

Citing a solution, the Denver Green Roof Initiative placed an initiative on the November 7 ballot, which recently passed, that will require buildings 25,000 square feet and over, constructed after January 1, 2018, to cover at least 20 percent of their roofs with gardens or solar panels. Denver joins San Francisco, New York, London, and Paris in cities around the world with similar requirements.

Realtors, contractors, and builders opposed the initiative, citing a rise in construction and housing costs as their primary concern. The Green Roof Initiative estimates a green roof will cost about $15 more per square foot than a traditional roof but will pay for itself in six years.

Bringing the Outside In

Posted on November 22, 2017

By Roger Heerema

A fresh-air, 28th-floor amenity lounge has transformed a Chicago office tower.

EXPANSIVE CITY views might be the greatest advantage offered by an upper floor of a downtown high-rise. But once you turn your back to the windows, it’s easy to forget that you’re in the center of a bustling city. You could be on any floor of any office building, anywhere.

That’s not the case at 200 West Jackson, a recently redeveloped building in downtown Chicago. On the 28th floor of this office tower, windows open during warm weather months to bring in fresh air and the sounds of the city below. This full sensory experience creates an inviting and comfortable atmosphere for a hospitality lounge, where building tenants socialize, collaborate and recharge.

Click here to read more.

What Did You Miss at the Office Conference?

Posted on November 21, 2017

NAIOP and the Greater Workspace Association convened with great success last week in Brooklyn, with close to 400 attendees gathering to talk all things office real estate: from co-working to design to demand to tech and beyond. Want to see what you missed? Check out the presentations, with more content being added here daily. Read More