Originally published by Tejaswi Ponnada Parker on August 28, 2020.

The second-quarter contraction in commercial real estate (CRE) capital markets evokes memories of the significant liquidity and price discovery challenges encountered during the global financial crisis (GFC). However, the two crises share little else in common, at least up to this point. While the GFC indiscriminately impacted volumes and pricing across commercial property types as a result of the significant financial market stress, the impact of the pandemic on capital markets thus far has been more selective, widening the gulf between “winner” and “loser” property types. We begin with a brief overview and then dive into a cross-sectional and time-series comparison at the aggregate sector, sub-sector, and market level, in a bid to identify trends and understand investor risk sentiment.

Originally published in the NAIOP E-Newsletter on September 1, 2020 

The Federal Reserve last week announced it was ending its longstanding practice of preemptively hiking interest rates to stave off inflation. Chairman Jerome Powell said the central bank would instead focus on maintaining low levels of unemployment, even if it comes at the expense of higher prices for consumers. The Fed is expected to maintain its benchmark rate – which was cut twice back in March in response to the COVID-19 pandemic – at near-zero percent levels for the foreseeable future. 

Originally published by Grace Winters and Timi Anyon Hallem in NAIOP's Summer 2020 Issue

It’s crucial to review contracts during uncertain times.

As global markets, economies and governments marshal their resources to respond to the COVID-19 pandemic, real estate professionals must assess their options to address and absorb the impact. A critical and time-sensitive activity is analyzing the force majeure provisions in important agreements and preparing to make creative arguments to achieve the most favorable outcomes.

Thank you to Batson-Cook Construction for being our Scoreboard Sponsor at this year’s NAIOP Charlotte/CRCBR Golf Tournament on September 28!

Sign up as a sponsor to get your company name in front of brokers and developers, and catch up (from a safe distance) with your industry peers. For one price, your company will be recognized as a sponsor during this two-flight tournament! Sponsorships are available on a first-come, first-served basis. Learn more and sign up here: https://www.naiopclt.org/golf-tournament

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.

Join NAIOP on September 2nd at 2:00PM/EDT as we explore debt and equity capital flow today, and how it has evolved in the face of the current pandemic. Gary E. Mozer, Principal/Managing Director, George Smith Partners, will provide a macro overview of the market; discuss how lenders and investors are pricing and structuring and perceiving risk differently; changes in underwriting; and how diverse sources of capital are each lending/investing in the current climate.

Speaker: Gary E. Mozer, Principal/Managing Director, George Smith Partners

Collaboration | Guidance | Networking | Leadership

Earlier this week, members heard about taking your business to the next level with NAIOP. NAIOP’s Bennett Gray discussed with Tricia Noble, Ascentris; Brian Richards, Beacon Partners; and Patrick Pierce, Selwyn Properties, about why they participate in Forums and how it’s been a rewarding experience that’s allowed for professional and personal growth and development. Click here to view the full video recording.

The National Forums bring together industry professionals in select groups to share deep industry knowledge, develop successful business strategies and build long-term relationships.

National Forum groups meet twice annually and connect year-round online, but the Forums experience is more than just the face-to-face meetings. Regular virtual meetings between annual events and the development of individual relationships among members are highly valued benefits of the program.

The application period for the National Forums closes Monday (8/31)!

Click Here to Apply

Questions

Originally published on August 25, 2020 y NAIOP E-Newsletter

U.S. Federal Reserve officials last month agreed on the need for additional government action to support the economy, according to minutes from the July 28 meeting released last Wednesday. The comments come amid a Congressional stalemate over the size and scope of the next coronavirus relief bill.  

Originally published on Ron Derven in NAIOP's Summer 2020 Issue

Flexibility is a must, but document everything as specifically as possible.

All the legal precedent in the world won’t solve the problem of tenants who cannot pay their rent, such as restaurants or businesses forced to lay off all their employees because they have no revenue in the aftermath of coronavirus-related shutdowns.

Originally published by Dr. Hany Guirguis, Manhattan College and Dr. Timothy Savage, New York University on August 2020 for NAIOP Research Foundation

COVID-19 Spurs Demand for E-Commerce, but Recession Produces Headwinds for Industrial Real Estate

The U.S. macroeconomic landscape has deteriorated significantly since NAIOP’s February 2020 Industrial Space Demand Forecast. Most notably, the economy entered a recession that is likely to continue through the end of the year. Although industrial real estate has outperformed other commercial property types this year due to a surge in e-commerce, broader macroeconomic indicators suggest industrial space absorption will decline sharply in Q3 2020 and then rebound to positive levels in Q2 2021 (see Figure 1).

Become A Sponsor

Note: NAIOP Charlotte Cornerstone Sponsors (Capstone & Archstone Levels) and CRCBR Alliance Sponsors (Chairman & Corporate Associate Levels) are confirmed as hole sponsors.

Originally published by Ron Derven in NAIOP's Summer 2020 Issue.

During a pandemic, business-interruption insurance may not be a panacea.

As the COVID-19 crisis continues to affect the U.S., commercial property owners need to prepare for potential liability issues arising at their buildings, according to attorney George Pincus of Stearns Weaver Miller, P.A., in Fort Lauderdale, Florida, during a recent NAIOP webinar.

Join us on Thursday, August 27th during the Industrial Space Demand: What the Latest NAIOP Forecast Tells Us Webinar at 2:00PMEDT.  Although industrial real estate has outperformed other commercial property types this year, thanks in part to rising e-commerce sales, unprecedented economic indicators suggest U.S. industrial space net absorption may decline to negative levels during the next three quarters. What factors contribute to this projected decline, when will it rebound, and what does it mean for the industrial real estate sector?

To identify linkages between overall economic activity and the demand for industrial real estate, forecast authors Dr. Hany Guirguis, professor, economics & finance, Manhattan College and Dr. Tim Savage, clinical assistant professor, NYU SPS Schack Institute of Real Estate, will walk us through the numbers, provide an overview of their forecasting process and engage in a live Q&A session with attendees.

Join us on Monday, Aug 24th at 11:30 am as we take a look at an opportunity to create your own personal advisory board. The National Forums brings together industry professionals in select groups to share deep industry knowledge, develop successful business strategies, and build long-term relationships. Learn from NAIOP members about their experiences and how they use their Forum to create impactful relationships for your business.

Our Panelists

• (Moderator) Bennett Gray NAIOP Research Foundation and Forums
• Tricia Noble Ascentris (Industrial Development Forum)
• Brian Richards Beacon Partners (Capital Markets Forum)
• Patrick Pierce Selwyn Properties (Industrial Development Forum)

Registration

Click Here to Register

Originally published by Alan Joel for NAIOP on August 6, 2020.

The must-haves for the office of the near future may not be the same as they were six months ago. Since the COVID-19 pandemic has reshaped the way people live and work, every community has had to take stock of how their future office space and common area amenities can be safely occupied. As businesses across the country are in various stages of reopening, office real estate experts on opposite coasts shared how their clients are reimagining their office space.

Originally published by Trey Barrineau for NAIOP's Summer Issue.

Expanded sanitation processes and improved HVAC systems could become standard in the years ahead.

The coronavirus pandemic is forcing building owners and tenants to consider something they may not have given much thought to in the past — how clean their facilities really are.

Originally published by Shawn Moura, Ph.D., for NAIOP's Research Foundation in August 2020.

The coronavirus pandemic has had a broad impact on local economies across the U.S. and Canada. Mandatory closures and reduced consumer expenditures have impaired business operations across many industries, making it difficult for some commercial tenants to pay their rent on time and in full. Although less severely affected by the outbreak than hospitality or retail tenants, some office and industrial tenants have asked building owners for assistance in the form of rent abatements or deferrals. A small minority of these tenants have simply refused to pay rent.

Take a quick look at an opportunity to create your own personal advisory board. The National Forums brings together industry professionals in select groups to share deep industry knowledge, develop successful business strategies, and build long-term relationships. Learn from NAIOP members about their experiences and how they use their Forum to create impactful relationships for your business

Our Panelists

• (Moderator) Bennett Gray, Vice President, NAIOP Research Foundation and Forums 
• Tricia Noble, Ascentris (Industrial Development Forum) 
• Brian Richards, Beacon Partners (Capital Markets Forum)
• Pat Pierce, Selwyn Properties (Industrial Development Forum)

Click Here to Register

Become A Sponsor

Note: NAIOP Charlotte Cornerstone Sponsors (Capstone & Archstone Levels) and CRCBR Alliance Sponsors (Chairman & Corporate Associate Levels) are confirmed as hole sponsors.

Originally published by Shawn Moura Ph.D. on August 3, 2020.

Last week, NAIOP conducted its fourth monthly survey of its U.S. members on the impacts of COVID-19. Since April, the association has examined the pandemic’s effects on conditions in commercial real estate and evaluates how firms have responded. The July survey results reveal that commercial real estate fundamentals are improving, but that the pandemic continues to impact development projects and appears likely to remain a significant challenge for longer than many had initially expected.