Sound Bites From NAIOP’s National Research Directors Meeting and Commercial Real Estate Conference

Winter 2015/2016

Sound Bites From NAIOP’s National Research Directors Meeting, Sept. 17, 2015, in Herndon, Virginia and NAIOP’s Commercial Real Estate Conference, Oct. 13-15, 2015, in Toronto.

From NAIOP’s National Research Directors Meeting:

“The challenge for property owners … who have tenants with some sort of an online presence will be how to ‘capture’ the online sales that the physical presence is driving. Apple is doing that, but not too many [other] retailers are.” Jim Costello, senior vice president, Real Capital Analytics

“Why haven’t retailers done more with their omnichannel models in the last two years? One theory is that they’re spending a lot of their IT budget on cybersecurity, and not necessarily on using it to figure out their omnichannel models.” Aaron Ahlburn, senior vice president, Americas, and director of industrial research, JLL

“Security of information is a big issue. There has to be more cybersecurity in the cloud, between e-commerce and the end user, or there could be real consequences to your businesses.” Robert Hartley, director of research, Washington, D.C., metro area, Colliers International

“This is the sweet spot for the office sector, from an investment perspective.” Rene Circ, director of research, CoStar Portfolio Strategy

“Is the mall dead? I think we all agree that the mall is not dead. … Maybe a better question is ‘has the shopping mall lost its mojo?’ … Online retailing has taken away from that experience; now the coolest stuff is only available online. I wonder if even the best malls have lost a little bit of their mojo.” Ross Moore, director of research, Canada, CBRE

From NAIOP’s Commercial Real Estate Conference:

“One of the changes in commercial real estate is that we used to force people to adapt to the buildings we had. Now, we are adapting buildings to individuals’ workflows. … Employee happiness is becoming a big factor in design. ‘People first’ is the new catch phrase.” Diane Davidson, chief operations officer, Sperry Van Ness International

“Real estate is nothing more than the physical framework we hang society on top of. Understanding society’s wants and needs is important to understanding what drives value in real estate. How does a real estate company use this information in its strategic plans? I think it’s investment risk mitigation, I think it’s establishing resiliency and sustainability. Those things require that you understand how you evolve. … It’s hard when change is occurring as rapidly as it is today.” Mark Stapp, executive director, Master of Real Estate program, Arizona State University

Regarding suburban office redevelopment: “You can basically break it down into two categories. There are those locations and projects where there is an opportunity to intensify, to add residential or retail amenities… to make it a more desirable environment. … Buildings that don’t have those opportunities will simply meet a basic need, based on convenience and price.” Andre Kuzmicki, executive director, program in real estate and infrastructure, York University-Schulich School of Business

“Mixed use is fundamental to everything we do. The days of building an office tower with a single-purpose lobby or a residential tower with a single-purpose lobby are long gone. Our customers, our tenants, want mixed-use urban infill. For us, that’s not just a mix of uses within a building, or within a neighborhood. It includes indoor and out-door space, and fundamentally includes access to mass transit. We’re seeing this all around the world.” Syl Apps, managing director, Hines

Regarding HR as part of the site selection process: “It is interesting to do a tour of a property with the e-commerce person and the logistics person, and then … the head of HR wants to tour the project as well, to determine amenities and access, and to figure out the labor part of it. That is because the employee count at these [fulfillment centers] is so substantial that HR is very much in the mix now.” Richard Strader, senior vice president, Prologis

“All of us become aware of different trends in different ways. For me, it was back in 2008-2009, when I took my daughter back to college. Before I left, she asked me to get the desk out of her room. As I drove home that night, I realized that I had 14 million square feet [of office space] and 65,000 desks. … I had a serious issue.” Bryan Koop, senior vice president, Boston Properties

“Tenants are shrinking and they’re looking to use space more effi-ciently. It started from the hope to save money, but it’s evolved … into trying to create better spaces for companies so that their people can be most productive.” William Quinby, executive vice president, Savills Studley