BLOG

RECAP: Candidate Forum: Primary Election for Charlotte City Council

Last week, members of Charlotte’s real estate community spoke with several Charlotte City Council candidates to learn more about their views and how they see the future of Charlotte. Thank you to our event sponsors: Canopy Realtor® AssociationCharlotte Region Commercial Board of REALTORS®NAIOP CharlotteHome Builders Association of Greater Charlotte, Inc. and the Real Estate & Building Industry Coalition (REBIC).

As a reminder, primary elections are on Tuesday, September 12.

Photo Album

Wisconsin City Proposes Transportation Utility User Charge

Originally published on August 16, 2023, by Jim Villa from NAIOP.

Earlier this year NAIOP Wisconsin was made aware that the City of Wauwatosa was looking to fast-track the adoption of a transportation utility user charge or fee (TUF) in order to generate additional revenue for local transportation and infrastructure needs. The city cited the deferred maintenance of their aging infrastructure, fiscal infrastructure constraints set by state funding limits, and an equitable fee structure based on who uses the road for the new fee. The proposal was set to be considered for approval in July. Our concern was that the adoption of the transportation utility fee in Wauwatosa might lead to other cities considering similar unlawful measures for additional revenue.

The transportation utility fee would apply to both residential and commercial properties based on the vehicle traffic generated by the property’s use, and not necessarily their valuations. The city would cap the annual fee at $51.00 for single-family properties with a sliding scale for other properties based on national engineering standards. 

Read More

Seattle Office Market: Current Headwinds and Future Optimism

Originally published on August 30, 2023, by Gary Baragona for NAIOP.

The slow recovery of the U.S. economy continues to have an impact on the office market in Seattle as well as across the county. Despite steady job growth and moderate economic recovery gains during the first half of 2023, the Puget Sound regional economy is still struggling and will face continued headwinds during the near term, bringing an enduring sense of uncertainty and concern. According to the Puget Sound Economic Forecaster, regional employment grew by 3.1% in 2022 while job growth is forecasted to increase by an additional 3.3% in 2023 before dipping to 1.5% in 2024. Additionally, the consumer price index was at 8.9% to begin the year, with inflation forecasted to rise by 5.2% in 2023 and 3.1% in 2024.

Despite recent job growth, the Seattle office market is experiencing a steady rise in vacancy, increasing from 5.8% in the second quarter of 2019 to 12.2% at the end of the second quarter of 2022, a 640-basis point jump over just a three-year period. Current vacancies are at a 10-year high and just registered the 12th quarterly increase over the past 14 quarters. One year ago, regional vacancy exceeded the 10% mark for the first time since 2013, and it has now eclipsed 12% for the first time since 2011. Additionally, more than 19% of the current vacancies are from sublease space, which is approximately 18% higher than it was last quarter. The increase was primarily due to an uptick in Eastside sublease vacancies over the quarter.

Read More

2023 Developing Leaders Award Recipients Announced

Originally published in August 2023 by NAIOP.

NAIOP SELECTS FIVE EXCEPTIONAL YOUNG PROFESSIONALS TO RECEIVE 2023 DEVELOPING LEADERS AWARD

NAIOP, the Commercial Real Estate Development Association, has selected five professionals to receive its prestigious 2023 Developing Leaders Award. The annual award honors exceptional professionals under the age of 35 for their outstanding professional accomplishments, strong leadership, and significant community involvement. The winners will be recognized during NAIOP's CRE.Converge 2023, Oct. 18-20, in Seattle. 

“These young professionals stand apart for the vision, leadership, and dedication they bring to NAIOP and commercial real estate,” said Marc Selvitelli, CAE, president and CEO of NAIOP. “We are pleased to recognize their accomplishments and their work in creating vibrant communities in which to work, live, and play. We look forward to a bright future ahead for each of these distinguished leaders.” 

Recipients of NAIOP’s 2023 Developing Leaders Award

Amenities Have Evolved in Office and Industrial Spaces

Originally published on August 18, 2023 by Paul Bubny for ConnectCRE.

The role of amenities has evolved since the pandemic—not only in the office sector, but in the ever-evolving industrial space as well. To provide an up-to-the-minute look at trends in amenitizing commercial spaces, NAIOP will devote an entire panel discussion to the subject at its CRE.Converge conference, scheduled for Oct. 18-20 in Seattle. In advance of that panel, Connect CRE spoke with two of the panelists—moderator Dawn Riegel, Principal with Ware Malcomb, and Jinger Tapia, VP Design at Ware Malcomb—for a preview. Here’s what they told us.

Q: Would you say that workplace amenities are now more important than they were prior to the pandemic?

Dawn Riegel: In the true office environment, the message I share with my clients is: you want to create a magnet versus a mandate. Meaning you want people to come back into the office and what you are offering them needs to be above and beyond what’s in the four walls of their house. It really is the social aspect for employees. The amenity spaces within office environments, and this does translate to industrial, are super important now more than ever. The hybrid work movement dictates that these amenity spaces be integrated into office spaces from day one.

Read More

When Cities Eliminate Parking Minimums, What Happens Next?

Originally published in Summer 2023 by Robert Ferrin for the NAIOP Development Magazine.

Creative solutions and community engagement are crucial when dealing with changes to parking policies.

Minimum parking requirements, which require building owners to provide a fixed number of parking spaces, have played a key role in American municipal policy since the 1920s. Following their widespread adoption in the 1960s, these laws significantly impacted the design of cities and strongly contributed to the growth of a car-centric culture. Today, there are an estimated two billion parking spaces in the U.S., according to a March article in the New York Times.

In 2017, Buffalo, New York, ushered in a new era when it became the first major U.S. city to abolish parking minimums. Minneapolis, Raleigh, San Jose, and others followed. At the beginning of 2023, California became the first state to abolish parking minimums for developments located near public transportation routes.

Affordable housing, transit, and environmental advocates celebrated these policy changes. They point to lower development costs, improved walkability, and increased multimodal transportation, which reduces carbon emissions and vehicle congestion. Together, they can help municipalities meet their climate action goals.

Read More

New Podcast Episode with Mark Rose, Chair and CEO, Avison Young

Originally published on August 21, 2023, by the NAIOP Podcast: Inside CRE.

Mark, meet Marc. Mark Rose, chair and CEO of Avison Young, joins Marc on the podcast for a discussion about building a workplace culture that matters; what his experience tells him about challenges in the current economic climate; the rumor he’s heard about the Fed; and why he “couldn’t be more optimistic” about the office sector. Mark shares recent data about longer-term leases that may surprise you, talks about actively mentoring 14 professionals, and why he believes office space will return to the days when it was a key part of a company brand. Recorded on August 2, 2023.

 

Listen Now

Developing Leaders Spotlight: Creatively Solving Complex Challenges

Originally published on August 11, 2023, by Marie Ruff for NAIOP.

A career in commercial real estate presents ample opportunities for problem-solving and creative approaches to complex challenges – a natural fit for Sagar Rathie, managing director, commercial office/mixed-use, Crescent Communities, and recipient of the 2022 Developing Leaders Award. His colleagues note his “uncanny ability to problem-solve,” long-term strategic thinking, strong market knowledge, and talent for bringing out the best in others as examples of his professional strengths.

Sagar Rathie joined Crescent Communities in 2016 and currently serves as managing director for the commercial division. He leads all aspects of the company’s office and mixed-use acquisitions and developments throughout the Southeast, with an active investment and pipeline development portfolio totaling 3.5 million square feet and representing $1.0 billion in capital deployed. He is responsible for sourcing, entitling, designing, financing, and executing on new and value-add commercial office and mixed-use developments across the Carolinas, Tennessee, Central Florida, Georgia, Texas and Arizona.

Rathie has extensive capital markets experience, having collectively raised nearly $3.0 billion in third-party equity and debt throughout his career. Previously, he was Crescent Communities’ director of corporate finance and investor relations, where he played an integral role in the company’s financial forecasting and planning efforts, assisted with the investment committee process, and led numerous strategic initiatives for the company. Prior to Crescent Communities, he was an investment banking senior associate with Piper Sandler and a manager at GlaxoSmithKline.

Read More

A Full Fall Schedule Looms Over Congress’ Summer Break

Originally published on August 2, 2023, by Aquiles Suarez for NAIOP.

August has arrived, which for Capitol Hill means that Congress is in recess until sometime in September. Senators, congressional representatives and staff members scatter across the world on congressional delegation trips (so-called “codels”), and back to their home districts to meet with constituents, host fundraisers and boast about their legislative achievements. Well, perhaps all of those things are true with the exception of the last bit. 

The reality is that Congress left town last Friday with little agreement on a path forward for must-pass appropriations bills to keep the federal government operating past the start of the new fiscal year on Oct. 1. While congressional Democrats have been given their talking points on the economy by the White House, House Republicans had hoped to be much further along on their agenda to limit government spending by the time of the August recess. But only one of 12 appropriations bills that need to be passed and signed into law by the start of the new fiscal year has advanced in the House. And disagreement among Republicans on a proposed tax package has clouded the outlook for any tax legislation made into law this year.

Read More

NAIOP Survey Provides Insight into Skills Most Important to CRE Development

Originally published on August 3, 2023, by Shawn Moura, Ph.D., for NAIOP.

Finding, training and retaining talent has grown more challenging for commercial real estate development firms in recent years. Baby boomers are gradually aging out of the workforce, increasing demand for younger workers who can take their place. At the same time, technological innovation and an evolving industry constantly shape the skills and duties that are required of commercial real estate professionals. Last year, the NAIOP Research Foundation convened the Talent Development Task Force to examine how industry practitioners and educators can work together to improve career preparation and expand the talent pipeline in commercial real estate. The Task Force recommended that NAIOP survey its members on the skills that CRE employees will need to succeed.

In June, NAIOP surveyed member developers, building owners, investors and asset managers to examine the skills and credentials that are most important to development-related professions. Survey questions were designed to capture the perspectives of both managers and non-management professionals, and to evaluate which skills are most important to early-career and mid-career professionals. The survey focused on the most important soft and hard skills, and perceptions of different types of academic degrees and nondegree credentials. Additional information about respondents will be provided in a subsequent post that discusses respondent perceptions of different degree programs and other credentials.

View Survey Results

Will You Provide Input on Streets and Stormwater Manuals? City Staff Wants to Hear From YOU.

Originally published on August 8, 2023, by Rob Nanfelt the Executive Director for REBIC.

City Staff is seeking feedback on proposed revisions to two important manuals.  Details follow:

  • Charlotte Streets Manual - Staff is proposing amendments to clarify the intent and processes referenced in the UDO.  They include:
  • Stormwater Control Measure (SCM) Design Manual - Charlotte-Mecklenburg Storm Water Services is currently in the process of revising the BMP Design Manual, which will now be called the Stormwater Control Measure (SCM) Design Manual.  Please provide any feedback to Gurveer Uppal by the close of business on Friday, August 18th.

CLT Transportation, Planning, & Development Committee Provides Important UDO Update

Originally published on August 8, 2023, by Rob Nanfelt the Executive Director for REBIC.

During yesterday's meeting of the Transportation, Planning, and Development Committee, Charlotte Planning Director Alyson Craig provided an update on staff activities related to the new Unified Development Ordinance (UDO).  Here's what we know so far about the next round of proposed text amendments:

  •  #2023-093 was filed on June 16th, had a public hearing on July 17th, and will be considered for adoption by the full City Council on August 21st.  This is a minor change and will ensure that homes built before June 1st, 2023, will be allowed as conforming uses in the OFC (office flex campus) and CG (general commercial) zoning districts.
  • Another text amendment (not yet available for public review) was filed at the end of July and would allow multi-family uses in CG (general commercial) and CR (regional commercial) zoning districts.  According to staff, it will include elements of #2023-057 which was denied by Council on May 15th, primarily due to confusion over an attached drive-through provision.
  • One more amendment that has not yet been filed will amend allowed uses in Campus Zoning Districts and may include the addition of a new district.  This has been a major point of contention and we welcome the clarification when it comes.
Also discussed was the May 22nd Council Referral regarding duplexes and triplexes in Neighborhood 1 Zoning Districts.  Staff is contemplating filing a future text amendment that would allow these units to comprise 70% of proposed developments with the other 30% required to be single-family homes located near the property line adjacent to existing neighborhoods.  How these percentages/ratios would be determined - portion of development related to size, number of units, number of structures - has yet to be determined.  Expect to see action on this in early fall.

A tree canopy analysis has been underway for some time and the results will be released in September/October with recommendations to follow.  Apparently, the findings will include significant details including the impact of carbon sequestration, temperature fluctuations, and growth models.  

Alyson Craig's Full Presentation

The Impact of Proposed Air Quality Control Measures in Albuquerque

Originally published on July 18, 2023, by Rhiannon Samuel for NAIOP.

A new proposed rule change to how air quality permits are issued in the Albuquerque metro has many economic development organizations, associations and businesses very concerned. While the goal of protecting vulnerable communities and improving air quality is necessary, we must also carefully consider the impact of rigid regulations on economic development.

Proposed Rule Change: An Overview

In November 2022, several local activist organizations submitted a letter and proposed rule change to the Albuquerque/Bernalillo Air Quality Control Board, aiming to address the concentration of air pollution in low-income and minority neighborhoods. The proposed changes grant the board the authority to enforce greater emission monitoring and reporting requirements than what the Environmental Protection Agency requires on any entity emitting air contaminants. It also circumvents the board’s decision and appeal process to automatically deny certain permit applications. Those triggers to automatically deny applications include areas that will impact an “overburdened community,” where if one characterization is true, then the permit cannot be approved.

Read More

Essential Foundations for Workplace DEI

Originally published on August 1, 2023, by Brielle Scott for NAIOP.

Making progress on diversity, equity and inclusion (DEI) in commercial real estate may be challenging, but the workforce deserves – and increasingly demands – meaningful progress. However, organizations often aren’t sure where to begin.

In the first in a DEI webinar series presented by Trammel Crow Company, Rhonda Payne, CAE, founder and CEO of Flock Theory, introduced foundational concepts and key terms related to diversity, equity and inclusion.

“There is no shame in starting where you are and knowing where you want to go when it comes to your DEI practice,” she said.

Read More

The Most Eco-friendly Office Markets in the U.S.

Originally published on July 25, 2023, by Diana Sabau for NAIOP.

In the post-pandemic office market, the “flight to quality” trend among tenants has been growing alongside increased demands for sustainability. Consequently, demonstrating to clients that a property is equipped with the latest in energy-saving technologies and smart materials is the new standard. And, increasingly, clients are looking beyond their office windows to take a more holistic approach to sustainability, considering factors such as the city’s commitment to reducing carbon dioxide emissions, plans to build electric vehicle infrastructure or the stringency of local building policies.

With that in mind, 42Floors set out to compile a list of the most eco-friendly office markets across the U.S. by ranking cities using eight metrics. Specifically, entries received points for their performances across indicators that rated the local office inventory (including certifications, energy efficiency and materials used), as well as the environment in which the assets are located (like building policies, EV charging stations, public transit and walkability).

Read More

The Future of Electric Vehicle Charging: A Guide for Commercial Real Estate Developers

Originally published on July 27, 2023, by Trey Barrineau for NAIOP.

Electric vehicle (EV) use is accelerating, and commercial real estate owners can reap significant benefits from installing EV charging infrastructure at their properties. A recent NAIOP webinar explained how EV charging station implementation can attract and retain tenants, improve the property’s environmental score and generate new revenue streams.

According to Bryce Christensen, P.E., a senior partner with Kimley-Horn, EVs are becoming more affordable. Of the more than 40 options currently on the market, he said that 10 now cost under $40,000, and nearly every major automaker made public commitments to EVs, which should boost adoption by helping bring prices down even more.

“It’s no secret that the market share of electric vehicles in the United States and worldwide is trending up,” Bryce said. “The demand is rising, and many potential consumers are just waiting for more charging infrastructure before committing to going all electric.”

Read More

LISTEN: A Closer Look at CRE Construction Trends

Originally published on July 17, 2023, by the NAIOP Podcast: Inside CRE.

Marc sits down with Richard Branch, chief economist at Dodge Construction Network, a leading source of data analytics and insights on the commercial construction industry. Branch has us time-travel to the peak of the office market in 1985 (when the tax code allowed for extended depreciation); shares the latest data from Dodge on office renovation projects; and explores the link between the office market and popular culture, from “Mad Men” to “Office Space” to the end of the corner office. He discusses the hotel industry’s “aggressive rebound” post-economic crises; makes the case for why the office sector is here to stay; and shares the opportunities he sees for adaptive reuse in big cities and build-to-suit office space made for the hybrid work environment. Recorded on June 14, 2023.

Listen to Podcast

 

CLT UDO Change Request Form Introduced: Use it and Become Part of the Solution

Originally published on July 20, 2023, by Rob Nanfelt for REBIC.

Charlotte's Unified Development Ordinance (UDO) has been in place for nearly two months.  As was anticipated, we are seeing challenges in the field due to some of the new requirements.  Similarly, language changes have resulted in a lack of clarity and constrained flexibility.  Each of you have an opportunity to play a direct role in assisting us in obtaining some of the necessary changes.  Take advantage of it!

In collaboration with, and at the request of City Staff, REBIC members have developed a UDO Change Request Form to assist Staff and Members of Council with reviewing suggested changes to the ordinance.  Specific examples and recommended language changes submitted along with justification for the requested amendments should result in a more efficient process for obtaining clarity where necessary, and to accelerate the process of administrative as well as legislative relief. 

Complete the Form

Forms should be sent to Laura Harmon with the City of Charlotte Planning Department at [email protected], with carbon copies to [email protected][email protected], and [email protected].

My take:  I don't know how more directly to say this - if we want to fix the problems, in a timely manner, we need to demonstrate the need and reason for those changes.  This tool also provides another layer of accountability and buttresses our needs case to adopt amendments, as rapidly as possible.  When we entered into his new era of the 2040 Plan and UDO, it was frequently mentioned by Members of the Council and Planning Staff that modifications would be necessary and would be considered on an ongoing basis.  This tool will assist in tracking our progress and obtaining a more positive outcome.  Please share this within your network so it may be utilized broadly.  

Have We Forgotten What Leadership Looks Like?

Originally published on July 21, 2023, by Rob Nanfelt for REBIC.

Have We Forgotten What Leadership Looks Like? Let’s Show We Remember, This November.

It’s official. Candidate filing for the 2023 municipal elections in North Carolina has come to an end. I wish I had better news, but it looks like we will still have to choose from some of the same old tired leadership. Sure, there are bright spots but I’m wondering why we’re okay to keep electing people who are ill suited for the job. You’ll know what I mean as you read on.

We all know that many highly accomplished people, who could be good candidates, are busy doing other things. They are not drawn to public service, and we are not reaching out and recruiting them. There are the exceptions like Charlotte City Councilman Ed Driggs who retired years ago but has found a valuable niche serving the community. But he won’t be doing this forever so new leaders need to be identified, encouraged, supported, and promoted. And we need to start that process, now.

There are those that run because they see elected office as a stepping stone to other, bigger things. And some of them probably don’t care what happens to you after they leave. Although some of today’s solid elected officials started service at the local level and moved up, it was mainly because having already proved themselves leading school boards and cities, they simply wanted to test their mettle by doing other things. Beware of those seeking higher office just for the sake of going higher.

Read More

Designing for Wellness in Distribution Centers

Originally published in June 2023 by KSS Architects for NAIOP.

The rapid expansion of e-commerce over the past decade has reshaped industrial real estate and the nature of work within warehouses and distribution centers. Occupiers have invested in mechanization, automation and warehouse-management systems to maximize throughput. Despite that, distribution centers often require a large number of workers to process incoming shipments and outgoing orders. Growing competition for workers and increased awareness about workplace wellness have generated interest in designing interventions that can make these centers healthier and more attractive work environments. Wellness features in industrial properties can contribute to market differentiation, increase employee retention, impact productivity and help meet environmental, social, and governance (ESG) goals.

The NAIOP Research Foundation commissioned this report to offer design recommendations that improve occupant well-being. The authors conducted secondary research, observed conditions in existing distribution centers, and interviewed occupants to collect information on key wellness concerns. They then drew from these findings to design a prototype distribution center with elements and features that contribute to a healthier and safer work environment.

Read More