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IREM is Returning to DC for its Capitol Hill Fly-in
IREM is conducting its 2nd Annual Capitol Hill Fly-in March 10-11 to meet with federal legislators in Washington, DC, and discuss critical issues within the real estate property management industry. Last year’s Fly-in was a huge success, with 50% of IREM chapters attending and conducting over 100 legislative meetings.
It’s crucial for IREM members to meet with federal policymakers, who are addressing a number of property management issues including housing affordability, federal assisted housing and flood insurance. Staying active and engaged with them is the best way to advocate and promote beneficial public policies for our industry. There really is no substitute for practitioners sharing firsthand, personal experience with lawmakers and their staff.
Meeting with legislators in Washington is critical for the future health and growth of the industry, and with the Fly-in, IREM is making it as easy as possible for its members’ voices to be heard. Participating in the Fly-in allows members to: build relationships with legislators that will only increase in value over time; speak directly to the people with the power to change laws and regulations about issues that matter to property management practitioners, their businesses, and the clients they represent; gain valuable exposure and experience; and be part of something bigger than themselves.
Learn more about the Capitol Hill Fly-in and register here.
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NAR Issues Report on Marijuana and Real Estate
Last week, the National Association of REALTORS® (NAR) published a report encapsulating the results of their membership survey, “Marijuana and Real Estate: A Budding Issue.” The report begins by recognizing that as marijuana intersects with real estate, its impact on both residential and commercial properties is growing. Commercial practitioners are finding increased demand for land, warehouses and storefronts for marijuana. Residential practitioners are navigating an environment where marijuana is being grown and consumed within rental properties.
The report is broken down by how long marijuana has been legal within the state as of late 2019, the time when the survey was deployed.
Highlights on the commercial side include:
- States where medical and recreational marijuana has been legal for more than three years have seen more increases in demand for commercial properties—specifically, 42% saw an increase in demand for warehouses, 27% an increase for storefronts and 21% an increase for land.
- In states where it was legal before 2016, 21% had an increase in the value of commercial properties near dispensaries, but 18% reported a decrease.
- In states where medical and recreational marijuana was legal the longest, 32% had lease addendums regarding the growing of marijuana.
- In states where medical and recreational marijuana was legal the longest, thirty percent had lease addendums regarding sales of marijuana.
- The most frequently cited concern of commercial respondents was the smell when leasing to marijuana related businesses, followed by theft of cash on property, moisture issues and fire hazards.
Highlights on the residential side include:
- In states where marijuana was legal the longest, 27% had seen a decrease in residential property values near dispensaries and 12% had seen an increase.
- The majority of respondents reported that homeowner associations often had rules and restrictions against smoking and growing in home or common areas.
- In states that legalized both medical and recreational marijuana prior to 2016, half of the respondents had seen addendums added to leases which restrict growing on properties.
- In states where recreational marijuana is legal, 58%-67% of residential property managers have seen addendums added to leases which restrict smoking on properties.
- The most common issue was the smell, followed by moisture.
Read the full report here.
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Student of the Year Submissions are Open
IREM’s Student of the Year program recognizes outstanding college students who have demonstrated academic achievement and are looking to pursue a career in real estate management. This program gives students exposure to the world’s most respected real estate managers to build a foundation for a successful career.
Students enrolled full-time at a college or university during the 2019-2020 academic year are eligible to apply for this award. The selected student will be recognized by IREM at the 2020 IREM Global Summit, in IREM publications and across social media.
Have a student in mind? Encourage them to apply! The application is open through April 15, with all applicants notified of a decision in May.
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Industry headlines
Simon Property Group Acquiring Taubman Centers in $3.6 Billion Deal
Indianapolis Star (02/10/20) Burris, Alexandria
Simon Property Group, Inc. has agreed to purchase a controlling interest in The Taubman Realty Group Limited Partnership, a Michigan-based owner and operator of shopping malls. The deal is valued at $3.6 billion. Indianapolis-based Simon and TRG's parent company, Taubman Centers, have entered into an agreement under which Simon will buy an 80 percent stake in TRG. Taubman Centers owns, manages, and leases more than two dozen regional, super-regional, and outlet malls across the United States and Asia. Its U.S. properties include the International Marketplace in Waikiki, Hawaii, and the Beverly Center in Los Angeles.
"Simon, through its operating partnership, Simon Property Group, L.P., will acquire all Taubman common stock for $52.50 per share in cash," states the newspaper. The Taubman family is selling around 33 percent of its ownership interest at the transaction price and will remain a 20 percent partner in TRG. The deal is on track to close in mid-2020.
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The Smart Office
New Electronics (02/12/20) Tyler, Neil
As artificial intelligence (AI), the Internet, and new technologies continue to transform the way people work, offices are scrambling to keep up. Some major technological advancements have been linked primarily to new work routines in factories, but smart technology has transformed offices of all sorts. For example, technology has allowed more employees across the country to work remotely, giving them flexibility while reducing turnover costs. In particular, real-time collaboration, integrated communication platforms, and cloud computing have enabled employees to work effectively and productively from home or remote offices. With the new technology, employees can remain just as productive as if they were in the office itself while feeling valued by their company and loyal to it.
Even beyond working remotely, technology has facilitated video conferences with clients and out-of-town colleagues, enabling workers to communicate clearly and easily regardless of geographic location. Other new features in smart offices include rotating desk assignments. Employees can check a database of available desks and book specific desks to be closer to colleagues with whom they are collaborating. Or they can pick a desk in a quiet corner to hunker down and focus with minimal distractions. Meanwhile, AI has been incorporated into offices to gather and analyze data. With the analysis produced, office managers can make adjustments to best use their space, cutting down on waste and saving money. And with social pressure growing for companies to take a stand on climate change, renewable energy solutions such as energy-saving lighting is becoming more prevalent.
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Iowa Bill Would Give Apartment-seekers More Information on Energy Bills
Energy News Network (02/13/20) Uhlenhuth, Karen
Iowa lawmakers are considering a bill that would require owners of large apartment buildings to disclose typical utility costs to apartment-seekers. House Study Bill 635 would require building owners with at least 12 rental units to calculate the average monthly cost of utilities among apartments with the same number of bedrooms. The owner then would have to provide that information to potential residents before a lease is signed. The bill passed the state Senate 47-1 last March, and recently received a hearing in a House subcommittee. State Sen. Zach Nunn, a Republican from suburban Des Moines, said it appeals to lawmakers across the political spectrum. “They see it as a way to save money, both for renters and landlords,” Nunn said.
Iowa would join just a handful of other states -- including California, Hawaii, Maine and New York -- that have energy disclosure laws specific to rental apartments, reports the American Council for an Energy-Efficient Economy. Hannah Bastian, a research analyst with the organization, sees indications of growing interest in utility bill disclosure requirements in other markets. "A lot of cities are expressing interest and exploring this," she said. "They may become much more prevalent in the next few years." Iowa’s bill departs from others, she said, because it is focused on disclosing expected costs for a specific apartment as opposed to a whole building’s energy use.
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Pop-Up Stores Offer Reprieve to Retail Owners, Say Ancillary Retail Expo Panelists
Shopping Center Business (02/11/20) Peisner, Lynn
Panelists at France Media's recent Ancillary Retail Expo addressed the importance of pop-up stores to the retail sector. With legacy retailers and traditional anchor shops struggling to keep business up in the age of e-commerce, experts have said shopping malls need something compelling to draw young shoppers out for a visit. That compelling feature may be ancillary retail. Ancillary retail refers to pop-up stores, sponsorships, special events, or any other revenue streams outside of traditional long-term leases. Joe Purifico, general counsel and principal for JBC & Associates, moderated the Ancillary Retail Expo and discussed the growth of such commerce in recent times. Referring to pop-up stores, Purifico said, "We are no longer the little sister of the industry. We are here."
In the past, ancillary retail consisted of carts or kiosks that could be easily ignored amidst bustling stores. But with malls struggling to keep traditional retailers as their tenants, pop-up stores have transitioned into vacant space and become a healthy and vital aspect of retail. Malls are eager to welcome short-term pop-ups to keep consumers interested and test out new ways to build growth. In particular, malls are increasingly eyeing online-only businesses, offering them space to have a physical store for as long or short a time as needed.
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Nashville Chosen as Second Google Fiber City for This New Service
Nashville Business Journal (02/11/20) Stinnett, Joel
Google Fiber Webpass is now being offered in Nashville, Tenn. The service allows buildings without direct access to a fiber-optic line to receive Google Fiber Internet. Webpass uses radio signals from antennas placed on a building with an existing Google Fiber line to transmit Internet to other buildings that have Google Webpass equipment. Google Fiber is currently available in nine neighborhoods throughout Nashville and more than 50 multi-unit residential and commercial buildings.
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Mall Turns to Dogs to Attract Shoppers
Fox Business (02/12/20) Perry, Catie
As shopping malls continue to struggle in various parts of the country, one Illinois shopping center is testing a unique method to attract customers: allowing dogs to accompany their owners. Yorktown Center, located just out of Chicago, allows shoppers to bring their canines inside 58 of its tenant retailers. Dog-friendly stores are clearly marked with a paw print sticker. There are comfort stations with bags, wipes, and trash cans located throughout those 58 retailers and common spaces within the mall. Yorktown Center's dog hospitality has earned it the title "No. 1 coolest pet-friendly mall in the country" from the website BringFido.com.
Shoppers have eagerly embraced the dog-friendly policy. One shopper said he thinks the policy is a great idea year-round, but especially in the winter months. With cold temperatures often shortening outside walks and exercise for dogs, they can go without much social interaction and lose outlets to burn off their energy. But the shopper said he likes bringing his dog to the mall to get a good walk in and have his pup meet and play with other shoppers' pets. But even though the pets are permitted in many places throughout the mall, Yorktown Center does enforce a rule requiring dogs to go outside for bathroom needs.
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Trends in Workplace Amenities, Design Reflect Changing Culture
Talk Business & Politics (02/16/20) Peevy, Nancy
The atmosphere at most offices has changed drastically in recent times. Where formal attire was once expected and now-outdated technology once reigned supreme, today's offices tend to be more relaxed. Nina Charnotskaia, senior director of workplace strategy at CBRE Group Inc., said office managers have found that turning the office into a destination of sorts will help workers look forward to each day. Acknowledging that a workplace "brings [workers] together as a community, fosters culture and connection to purpose, and gives them the resources to be their most effective," Charnotskaia said offices have added popular amenities to attract and retain talented professionals.
John Connell, a principal with SCM Architects of Fayetteville, Ark., said more and more offices tend to have high ceilings, open spaces, natural light, and plenty of glass to reinforce an open, airy atmosphere. Offices have also made aesthetic upgrades by incorporating plants and other natural elements into spaces. Meanwhile, popular amenities include upgraded kitchens and break rooms, bicycle storage rooms, fitness centers, and full bathrooms with showers. Some offices have taken it a step further, adding entertainment-based amenities like golf simulators and game rooms. Others have totally transformed the traditional seating arrangement, eschewing corner offices for senior executives and embracing flex office space. In these workplaces, workers are not tied to any one desk and can move around to maximize productivity as needed.
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Designed With 'Psychographics,' Brookhaven's Oleander Aims to Offer Rental Zen
Curbed Atlanta (02/12/20) Keenan, Sean
The interior design firm Mary Cook Associates (MCA) announced earlier this month that a new 384-unit apartment building called Oleander has opened in Brookhaven, Ga. Though the oleander plant is poisonous, the Oleander apartment complex is designed around healthy, holistic living. MCA's announcement noted that the company used "psychographics" to ensure that Oleander "facilitates certain types of desirable behaviors and responses from residents." In other words, MCA took into account prospective residents' psychological traits -- i.e., their wants and needs as tenants -- when designing the building. Above all else, said MCA founder Mary Cook, the design process sought to "drill down to what motivates residents and how they are most likely to positively interact with spaces."
For Oleander, this meant incorporating calm, zen common areas. The focus on peaceful living is further emphasized through a fitness center and other amenities catering to healthy lifestyles. Oleander residents can enjoy a number of other amenities, too. There is a library in the building that can be quickly and easily converted into a conference room, a coworking space, a lounge for social interactions and gaming, and a coffee bar. Outside of the building, MCA included a swimming pool open year round, a landscaped courtyard, grilling stations, a fireplace, a dog park, and a beer garden.
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Kowalski's Market Finds Opportunity in Shopping Malls
Progressive Grocer (02/12/20) Kleckler, Abby
Minnesota-based grocery chain Kowalski's Market is expanding to two new locations in the Twin Cities area. In both cases, Kowalski's is setting up shop in shopping malls. The chain has reportedly signed a lease for a 30,000-square-foot store at Rosedale Center and is planning to sign another one at nearby Southdale Center soon. Mike Oase, the chief operating officer for Kowalski's, said the company had its eye on the two shopping centers for some time and moved quickly to secure leases when the moment was right. "Rosedale and Southdale have done a lot to improve their malls," he noted.
Rosedale is indeed in the midst of a $200 million expansion. In an attempt to recover from lagging growth, management have opted to transform the shopping center into a mixed-use attraction. When the renovation is completed, Rosedale will have apartments, senior housing, two hotels, and new commercial space in addition to the existing retail footprint. If more grocers follow in Kowalski's footsteps, the future of malls could look very different from their retail-dominated past.
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Protein Bar Launches Office Delivery Program
Restaurant Business (02/12/20) Lalley, Heather
The fast-casual food chain Protein Bar has started an office building delivery program, hoping to find a cost-effective balance between remote food orders and delivery operations. The program is called Minibar. Participating offices receive a direct-ordering link that is supported in both mobile and desktop views. Employees use the link to place lunch orders. Protein Bar then delivers all of the lunches to a predetermined location at each office building, and employees collect their food there. Protein Bar COO Jared Cohen said Minibar adds "another layer of convenience" for customers. The Minibar program is similar to salad chain Sweetgreen's Outpost service, which currently delivers to 800 locations. The Chicago-based chain currently has 19 locations across the country, including in Washington, D.C., and Colorado. As of now, the Minibar program is available for offices within walking distance of its locations, but Cohen said management is open to expanding that.
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Virginia Lawmakers Advance Tenant-Friendly Laws to Cap Late Fees, Force Repairs
Fredericksburg Free Lance-Star (VA) (02/10/20) Oliver, Ned
Virginia's Democratic-majority General Assembly is advancing tenant-friendly laws, with a recent bipartisan show of support for relaxing rules and regulations on renters. Some of the changes the General Assembly are considering include a cap on late fees, more leverage for tenants to force repairs, and a requirement that large apartment complexes accept housing vouchers so low-income residents can pay their rent. Previous Virginia lawmakers have been friendlier to owners than renters, and Christie Marra of the Virginia Poverty Law Center said any tenant-friendly changes were sanitized and packaged to present the least possible disruption to the system.
But this year is different, according to Marra. Virginia lawmakers are more willing to proceed with legislation that apartment owners do not approve. Sen. Bill Stanley, a Republican, introduced a bill that would allow tenants to make their own easy repairs and deduct the cost from their rent if landlords do not address the issue within two weeks. Chip Dicks, a lobbyist for the Virginia Realtors, said the new laws are not targeted at responsible owners, but will unleash harsh consequences on irresponsible or "slumlord-type" landlords.
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Home Depot to Hire 80,000 Associates for Spring
PRNewswire (02/11/20)
Home Depot is hiring approximately 80,000 associates this spring for both full-time and part-time jobs. Many of the part-time positions will be in the retailer's garden centers. In addition to these jobs, the company is hiring for overnight freight, merchandising, and other customer service roles across store departments along with warehouse associates for its distribution centers. Home Depot ranks as the world's biggest home improvement specialty retailer, with 2,291 retail stores in all 50 states, the nation's capital, 10 Canadian provinces, Puerto Rico, the U.S. Virgin Islands, Guam, and Mexico.
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