December 2020 - Sachse Construction

Energy Efficiency as a Service Gaining Ground as Financing Approach for Adopting Innovations

December 23, 2020 by Sachse Team

In recent years, innovations in energy efficiency technology has opened many new avenues to reduce electric consumption in buildings.

But it is hard for building owners to keep up with these developments, analyze which options are most cost effective, and decide how best to invest their money. An increasingly popular method to implement energy efficiency technology is called “energy efficiency as a service.”

A typical arrangement consists of a building owner and a provider striking an agreement that pays for energy efficiency projects. The building owner does not pay anything upfront. The owner makes payments in installments within a certain timeframe. Payments are in the form of savings in energy costs realized from the improvements.

Bentley Mills, a manufacturer of commercial carpet products, employed this technique to fund a $1.5 million energy efficiency project. The contract stated that over the course of the 8-year term, Bentley would save over 12.8 million kWh. One year after the project was completed, the plant measured a 21% decrease in the kWh per square yard manufactured while increasing sales growth by 9% during the same time.

Seeking Reliable Real Estate Businesses, Investors Give Laundromats A Spin

December 23, 2020 by Sachse Team

Coin laundries have long been one of the few recession-proof businesses. After all, we all need to do laundry. There’s debate as to whether the recession-proof nature applies even during a pandemic. But it’s not deterring some from opening new laundromats, at a time when cash is tight and more landlords are installing in-unit washer-dryers.

It appears the onset of COVID-19 has been a double-edged sword for the coin laundry business. On one hand, the pandemic has spurred many motivated by health worries to more frequently clean clothes they believe may have been exposed to the virus. On the other, the economic fallout from coronavirus has fewer coins jingling in the pockets of would-be customers. Some observers have suggested that has meant more former coin laundry-using renters moving back in with parents. Other consumers have no doubt reduced the number of trips they make to the local laundromat, not only to save money but to avoid exposure to the virus in an indoors setting.

Uncowed by COVID

One company apparently undaunted by the pandemic is PWS Laundry, which is looking to open 30 to 50 new locations across the U.S. between mid-2020 and next summer. “Our company has been around for generations,” said Brad Steinberg, co-president of Los Angeles-based PWS, noting the enterprise started in 1968 when his grandfather and two partners launched their now more than half-century-old business.

Over the years, its owned-and-operated laundromats have gone by such brand names as Launderland, Sudz and the most recent brand moniker, SpinCycle Laundry Lounge. Its modern laundromats are known for up-to-date fixtures and finishes, energy efficiency and positive patron experiences.

In addition to developing state-of-the-art retail laundromats and selling them to independent operators, PWS is the nation’s largest distributor of laundry equipment and parts for laundromats, commercial laundries and multifamily landlords. Financing and brokerage are additional components of the PWS business model.

Market indicators

“My business partner, Brad Pollack, is a second-generation owner and we both see an incredible opportunity to accelerate the development of new laundromats,” Steinberg says. What would make this a good time to look at this business type? According to Steinberg, the factors include a growing cohort of renters, who of course comprise the largest segment of the self-service laundromat business. Another is the availability of opportune retail real estate locations, especially given the failure of many retailers this year. Given the decline in many commercial property owners’ fortunes during the pandemic, some owners may offer greater flexibility to cover cost of build outs.

From landlords’ perspective, the benefits include steady demand for operating businesses on the part of eager entrepreneurs. Laundromats are also long-term, stable tenants, and their steady business can bring substantial foot and vehicular traffic to shopping centers.

Despite the freshly-washed lingerie known to emerge from laundromat washers, there’s nothing sexy about this business. Still, Steinberg finds it hard to fathom a more pleasurable career, or a more dependable business for a neighborhood shopping center. He says they are stable, consistent performers operationally. They are resistant to recession, virus and Amazon. And they are a magnet for local traffic, he asserts.

A Los Angeles baseball fan, Steinberg recalls leaving his home hours before first pitch at Chavez Ravine, a move letting him and his partners “touch all the bases” along the way. “We would leave for a 7 p.m. Dodger game at 10 a.m., so we could stop at 20 laundromats on the way to the stadium,” recalls Steinberg, who spent part of his career in investment banking. “As much as I loved banking, this was always my true calling.”

Swiss Running Shoe Brand On Opens First Store in NYC

December 16, 2020 by Sachse Team

A Swiss sneaker brand that counts Roger Federer among its investors is opening its first store ever on Wednesday in lower Manhattan.

On, whose running shoes sell for about $150 to $200 a pair, has made its shoes available in Nordstrom, REI, JackRabbit and other high-end specialty stores for a decade.

But until now, the Zurich-based company with 800 employees didn’t have its own flagship.

The 1,630-square-foot store at 363 Lafayette St. boasts a “Magic Wall” where runners can sprint the length of the store while tech devices pick up their running gait to allow the staff to recommend a style of shoe.

While tiny compared to Nike, Adidas, Puma and other established brands, On’s sales have “more than doubled” year to date, according to NPD Group sports analyst Matt Powell and they are “taking share.”

On co-founder David Allemann claims that On is the No. 3 brand in Germany and one of the top four brands sold in specialty running stores. It has a cult-like following among marathon runners, according to reports.

The patented shoe has a “softer landing” during running and gives an “explosive take-off” according to Allemann.

Tennis great Federer invested in On last year after his 24-year partnership with Nike ended. He released a limited-edition tennis shoe with On last year and in July the company released The Roger, an all white tennis shoe that sells for about $250.

On signed its lease for the space — in a new building — before the pandemic and had planned to open in June.

“We felt that starting out in New York City was important because it is one of our largest running communities and where we’re first launching in the US,” Allemann told The Post.

Opening during a pandemic may not be optimal, but Allemann points to a “running boom” that has helped to fuel especially strong sales growth this year.

“On is an up and comer,” says Powell. “Their sales trend is as if there was no pandemic at all.”

Modular Construction Meets Changing Needs in the Pandemic

December 16, 2020 by Sachse Team

When the University of Denver reopened for classes this fall, there was a new building on campus next to the student athletics center: a coronavirus testing center created using modular construction.

Students and staff can either walk up or drive up to have their temperatures screened or to receive a virus test at one of six windows at the center, a 40-foot-long building manufactured out of state in a factory and shipped to Colorado on a flatbed truck. Proponents say the method is faster and greener than conventional construction.

“With modular, we can build more quickly and have better quality control, while reducing waste and our carbon footprint,” said Andrew Ahrendt, director of national manufacturing at PCL Construction, a group of independent general contracting companies that manufactured the testing site, known as the Citizen Care Pod.

Modular construction has been growing in popularity among developers as a method for building multifamily housing, hotels and workplaces. The pace of hospitality and office projects has slowed in 2020 as a result of the pandemic, and many developers have turned instead to medical buildings, affordable housing and data centers.

Behind the push has been an effort to address the health concerns of businesses and schools trying to operate safely. Earlier this year, for example, modular hospitals were built in Wuhan, China, in less than two weeks.

The testing pod at the University of Denver, built in collaboration with WZMH Architects and Microsoft, can be enabled with sensors and cameras that can detect the temperature of people wearing masks and standing six feet apart. The pod was built in 10 days in a factory in Bakersfield, Calif., and took one day to set up at the university.

PCL has made similar care pods used at the University of California Los Angeles and Vancouver Airport. It also manufactures a modular visiting pod for senior residences with a ventilated, sanitized space for visitors to spend time with residents.

A type of prefab construction, the modular method ranges from manufacturing components such as panels and walls to full units such as kitchens and bathrooms in a factory and then assembling them on location like large Lego pieces.

“Modular makes sense for projects with a high volume of discrete and repeatable units,” said Scott L. Robinson, an assistant professor at the Schack Institute of Real Estate at New York University.

Modular construction can speed up construction by as much as 50 percent and cut costs by 20 percent, according to a 2019 report by the consulting firm McKinsey & Company, which estimated that modular construction could grow to a $130 billion industry in the United States and Europe by 2030. Upfront building costs of modular and traditional projects may be similar, but the savings come from the accelerated building timeline.

“Modular allow us to be more efficient and increase construction labor productivity,” said Steffen Fuchs, a partner at McKinsey.

The construction method accounts for about 5 percent of all new projects in both commercial and residential real estate, said Ryan Smith, the director of the School of Design and Construction at Washington State University.

“Between 2015 and 2020, we have seen a doubling of market share for modular construction in multifamily projects,” he said, adding that many three- to four-story modular multifamily buildings have cropped up around Puget Sound in Washington, in the San Francisco Bay Area and near Philadelphia.

But the industry has faced challenges in the economic slowdown caused by the pandemic. Financing has been difficult to find. Labor shortages have been an issue, too.

“Early on, we were always missing people” because of quarantines, said Gilbert Trudeau, president of RCM Group, a modular construction firm in Montreal. Still, he said, business has not slowed; the company recently finished a modular Hampton Inn in Verona, N.Y.

Before the pandemic, modular hotel construction was growing rapidly thanks to prominent projects like the $100 million, 19-floor CitizenM Bowery hotel that opened in Manhattan in 2018. Since 2015, Marriott has used modular construction in more than 70 hotels in North America.

“We can shave off six months of development, so instead of 18 to 20 months, we’re opening in closer to 12 months,” said Eric Jacobs, the chief development officer for Marriott Select Brands in North America.

In 2019, Marriott started construction on a 26-story, 168-room hotel in Manhattan, which will have prefabricated guest rooms, assembled and furnished off site with bedding, flooring and even toiletries. And when the stalled AC Hotel NoMad finally opens in 2021, it will be the largest modular hotel in the world.

As some sectors have slowed, the demand for multifamily and single-family homes, particularly affordable options in those categories, has only increased.

The modular firm Factory OS has attracted funding from large tech companies to use modular construction to create affordable housing. The firm raised $55 million in November from Autodesk, Facebook, Google and others. Factory OS has created market-rate housing, including corporate housing, for companies such as Google.

Eco-friendly materials like mass timber are a major selling point for many modular construction projects. Mithun, an architecture firm based in Seattle, has paired up with Forterra, a nonprofit conservation organization, to create affordable modular housing in Tukwila, Wash., out of laminated timber for a community of East African immigrants. The project, which will open in 2022, will include about 100 residences, a marketplace and community spaces.

“As cities’ budgets have been squeezed even further this year, cost-efficient options for affordable housing have grown even more critical,” said Craig Curtis, a partner at Mithun.

Retailers and restaurant chains have adopted modular construction, too. In October, Chick-fil-A opened its first modular location, replacing a restaurant in Roswell, Ga. Six separate modules — including the restaurant’s kitchen, drive-through counter, serving area, office and restrooms — were built in Conyers, Ga., by Frey-Moss Structures, which has also created modular buildings for Harley Davidson and TD Bank. The team completed the construction of Chick-fil-A approximately six weeks sooner than it could have through traditional construction methods.

Despite its growth, the industry still faces criticism about the quality and creativity of its projects. But experts say such complaints are overblown.

“Many developers are choosing modular construction because of a higher degree of quality, cost certainty and schedule certainty,” said Tom Hardiman, the executive director of the Modular Building Institute. And the process benefits from customization, he said, comparing it to automobile manufacturing, in which customers can choose various parts to create their dream car.

In fact, manufacturers are taking a page from the automobile industry by increasing the amount of automation and robotics in their factories. Technological advances may also help address the labor shortage, particularly among younger employees. “If you can talk about the technology involved, whether that’s automation or robotics, you have a chance of appealing to millennials,” Mr. Hardiman said.

And modular construction is highly adaptable, allowing developers to address the changing needs of people and organizations navigating the pandemic. The Citizen Care Pod at the University of Denver, for instance, could have another function next year: “It has the necessary refrigeration and technology to be converted into a vaccine dispensary,” Mr. Ahrendt of PCL said.

2020 Year in Review

December 15, 2020 by Sachse Team

“Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it’s the only thing that ever has.” – Margaret Mead

Sachse Construction has been giving back to the community since its inception in 1991. From raising more than $1,000,000 over the last 20 years at our annual charity golf outing Play it Foreward, to supporting skilled trade workforce development initiatives for over 3,000 Detroit youth through the Sachse Construction Academy, to volunteering across the City, our team members thrive on giving back!

In 2020 we made our commitment official with the establishment of the Sachse Social Mission (SSM) Committee. The team member committee is run like a Board of Directors and volunteer their time to lead the philanthropic charge for our company.

With a mission of contributing to a thriving Detroit by empowering and investing in organizations that support youth, workforce development, and community, the SSM committee spearheads fundraising, volunteer efforts, and not for profit partnerships.

In April 2020, at the onset of the COVID-19 pandemic, Sachse Construction gifted five (5) $50 Amazon Gift Cards (a total value of $250) to each of our 250 team members as a small token of appreciation for their dedication through the challenging and uncertain times. The message accompanying the Amazon gift cards read:

“Please use these funds not only to help yourself but to help others in need. We all know someone who is navigating without an income and we all encounter people on the front-line risking their lives to service us every day. Whether it’s a grocery store worker, a mail person, or a healthcare worker, anyone could use a random act of kindness in their life at this time. Let’s take some of our good fortune and pay it forward.”

The outpouring of generosity was overwhelming. Sachse Construction team members sent and delivered care packages including everything from food to basic necessities to Emergency Room doctors and nurses, children in foster care, out-of-work bartenders, teachers, essential workers, and so many more. The collective experience during this time of economic hardship was a powerful reminder of the positive energy generated by giving to others without an expectation of receiving anything in return.

In July 2020, after the killing of George Floyd, our world changed dramatically. To stand in solidarity of justice and equity for all, the SSM Committee launched the Sachse Social Justice Challenge to support local Detroit social justice organizations working on the front lines of the movement.

Within 24 hours, the Sachse Social Justice Challenge raised over $4,000 to support the work of the following social justice organizations: Black Lives Matter Detroit, Detroit Justice Center, Downtown Youth Boxing Gym, Humble Design, Neighborhood, Defender Detroit, SAY Detroit, The Bail Project, and The Empowerment Plan.

In September 2020, to ensure Detroiters have a safe place to call home, the SSM Committee launched the inaugural Sachse Virtual 5K Run/Walk to benefit the Habitat for Humanity Critical Home Repair Program and help low-income homeowners fund their most acute house repairs before winter.

Two of every five families in Detroit live in sub-standard or condemned homes. Burdened with the ongoing economic fallout from the COVID-19 pandemic, families who live in these unsafe and unstable homes make impossible decisions every day to either pay for food, medicine, or urgent house repairs.

Over 50 team members participated and donated to the fundraiser – many walking together from Sachse Construction’s Headquarters to Hart Plaza and back, raising over $580. An additional $5,000 donation was made from Sachse Construction to help families safely remain in their homes during this critical time.

Through all of the uncertainties that 2020 has thrown at us, there have also been silver linings. This year, the Sachse Construction team member community raised $2,585 and the SSM Committee donated a total of $17,590 to support the following 14 local Detroit, not-for-profit organizations through in-kind, financial, and volunteer initiatives:

If you know a Detroit based 501c3 organization doing important work supporting youth, workforce development, and community, please contact the Sachse Social Mission Committee Co-Chairs: Samantha Ardelean (sardelean@sachse.net) and Monica Minor (mminor@sachse.net) to get involved.

Bed Bath & Beyond Sells Cost Plus World Market

December 14, 2020 by Sachse Team

Bed Bath & Beyond Inc. BBBY, -1.14% announced Monday that it has entered into a definitive agreement to sell Cost Plus World Market for an undisclosed amount to Los Angeles-based private-equity firm Kingswood Capital Management.

The deal includes 243 bricks-and-mortar stores, two distribution facilities, an e-commerce business and a corporate office in Alameda, Calif.

Cost Plus World Market is expected to continue operating as a stand-alone brand.

The deal marks the final sale of Bed Bath & Beyond’s non-core businesses. For example, the company has also sold PersonalizationMall.com to 1-800-Flowers.com Inc. FLWS, +2.97% and divested its One Kings Lane home décor business earlier this year.

Bed Bath & Beyond laid out a three-year transformation plan during its investor event in late-October that included the sale of non-core assets with proceeds funding its resumed share buyback program.

The retailer also announced Monday that it has approved an additional $150 million accelerated share buyback program (ASR), in addition to the $225 million program approved on Oct. 28. Both are expected to be complete by the end of the fiscal year on Feb. 27, 2021.

The new approval will bring the total for the company’s share repurchase program to $825 million over the next three years, up from $675 million previously.

Shares of Bed Bath & Beyond fell 1% in Monday trading.

“While we understand the investor pushback that management not disclosing the terms of the transaction implies the amount is not meaningful versus other asset sales, we believe that is mostly shortsighted,” wrote Raymond James analysts led by Bobby Griffin.

“[W]e view the announced ASR as a sign management remains comfortable with the progress they are seeing in results and would not be spending incremental capital if trends were deteriorating.”

And both Raymond James and GlobalData think the sale frees Bed Bath & Beyond to focus on its core businesses.

“In terms of many operational aspects, Cost Plus World Market is a better retailer than that Bed Bath & Beyond,” wrote Neil Sauders, managing director at GlobalData.

“Its range is more focused and innovative, store layouts and merchandising are superior, and it has a strong base of loyal customers. However, the business lacks scale and Bed Bath & Beyond has neither the ambition nor the will to grow it in a significant way.”

However, Cost Plus Market’s online business needs work, and stores are hurt by the impact of the coronavirus pandemic.

“This issue may resolve itself in 2021, but Bed Bath & Beyond does not want to run the risk of having another brand to fix in addition to remedying the problems at its main banner.”

Separately, Bed Bath & Beyond announced a three-day free same-day delivery promotion with Shipt that will launch on Monday for the namesake retailer and buybuy Baby. The deal applies to orders of $39 or more, and items purchased by 1 p.m. will be delivered the next day.

Customers will also get a 20% discount Dec. 17 through Dec. 24 on purchases made using curbside pickup or buy-online-pickup-in-store.

Bed Bath & Beyond is scheduled to report fiscal third-quarter earnings on Jan. 7, 2021.

Bed Bath & Beyond shares have rallied 49.6% over the past three months, and nearly 24% over the past year. The benchmark S&P 500 index SPX, -0.03% has gained 16% for the past 12 months.

‘This Too Shall Pass’: 43 Real Estate Execs On The Biggest Lessons Of 2020

December 14, 2020 by Sachse Team

The last 280 days of the coronavirus pandemic have been unprecedented, unimaginable and tragic in countless ways. From an economic perspective, where we work, where we eat, where we shop — where we do anything — is still mostly in flux. It’s anyone’s guess what will come back stronger, or perhaps not at all. At every level of real estate and the global economy, people and companies are suffering.

But as a vaccine starts to be distributed, things could start to turn around, and businesses are looking at how their strategy should be different in the new year.

Bisnow reached out to commercial real estate executives across the world — from Calabasas, California, to Birmingham, England, and wherever else the business class is working from home — to ask a simple question: How has 2020 changed the way you’re going to run your business moving forward?

These interviews have been condensed and edited for brevity and clarity.

NAME: Rao Mulpuri
JOB TITLE: Chairman and CEO of View Inc.
SECTOR: Smart buildings
CITY: Milpitas, California
YEARS IN CRE: 12

In spite of a global pandemic that has led to immediate uncertainty in the real estate and construction markets earlier in the year, the picture became clearer and we recently announced our plans to go public and are experiencing unprecedented growth as we reinvent the way buildings are built. Most importantly, we are doubling down on our mission and laying the foundation for a post-COVID world where the health and well-being of people is the No. 1 priority for landlords and building managers. The shift toward healthier buildings didn’t begin with the COVID-19 pandemic, but it’s set to become an even more important trend in building design going forward, as people imagine life in the post-pandemic world. Leading companies are accelerating their sustainability goals, several of the industry’s most important investors have sustainability mandates, and the demand for safe, differentiated workplace experiences has never been greater. This year, we’ve all had to learn to navigate a shifting array of guidelines developed to keep us safe. Maybe more than other companies, government regulations are a key tailwind behind View’s ability to grow and thrive. For example, new building codes specifically target glass facades and windows. If 2020 has helped us appreciate one thing in particular, it’s that we are biologically hard-wired to crave connection to people and the outdoors; we need it to learn, grow, be productive and stay healthy. With View, the possibilities for connection are endless. And we’re just getting started.

***

NAMES: Mike Pestronk and Matt Pestronk
JOB TITLES: Co-founders of Post Brothers
SECTOR: Multifamily and other commercial development
CITY: Philadelphia
YEARS IN CRE: 15 years

The enduring appeal of urban living has been made clear: People don’t only live in the city to be close to their jobs and for restaurants and bars. They live in the city for opportunity — opportunity for professional advancement, for personal relationships, and to build off of the collective energy and ideas of others. Leasing has not had a terrible slowdown for us through the pandemic, and in fact, this quarter we are leasing more apartments than a typical year. People see the light at the end of the tunnel and are anticipating and appreciating more than ever the vitality of city life. Counter to popular narrative during the pandemic, we had less residents than in any of the previous four years move to sunnier southern places from the East Coast. It’s clear that our residents — urban, Class-A renters — do not want a suburban lifestyle with a grass backyard. The many factors that made urban living so appealing have been made clearer to us than ever, and we are generally doubling down on urban development. Simply put, people now appreciate and miss what they had and are extremely excited to get it back.

***

NAME: Keith Breslauer
JOB TITLE: Managing Director of Patron Capital
SECTOR: Private equity
CITY: London
YEARS IN CRE: 32

2020 has really brought the “why” to the front of all of our minds. Why do you do what you do? For me, it has completely confirmed that our approach of learning to navigate risk and find opportunities in any market, regardless of the conditions and how challenging they may be, is the right one. I’ll be taking this with me into 2021, both in business and in life, as we continue to explore the bigger “why” of our impact on the world around us by creating a positive impact on as many lives as possible through the Patron Charitable Initiatives and the Women in Safe Homes Fund.

***

NAME: Bradley Tisdahl
JOB TITLE: Principal and CEO of Tenant Risk Assessment
SECTOR: Office, industrial and retail
CITY: New York
YEARS IN CRE: 7

We have been forced to look at tenant risk through a narrower, shorter-term lens given the immense strain on certain asset classes. We are looking at two futures: a near-term reality and a longer-term aspiration. The current reality requires us to continue advising clients on cash flow risk while negotiating with distressed tenants to ensure our clients have adequate liquidity to service their debt obligations. Longer-term, once the pandemic is comfortably in the rearview, we expect to emerge into an environment where office and retail tenants use their space in new and innovative ways. Evolving real estate strategies are likely to introduce new fiscal pressure on our client base, which includes owners and landlords across North America and globally, which will reshape how we underwrite leases and acquisitions on behalf of our clients.

***

NAME: Ryan Simonetti
JOB TITLE: CEO of Convene
SECTOR: Flexible workspace
CITY: New York
YEARS IN CRE: 16

Running Convene this past year has been nothing like the past 11 years that we’ve been in business. This has been more difficult than when we founded the company during the ‘09 recession, and it has helped to reveal our own outdated modes of thinking and operating. The biggest change for us has been shifting from operating a physical business to a digitally led one because of the launch of our Virtual Meetings product. It requires increased agility and the willingness to try and fail, which feels a lot like we’re growing a startup within a startup. I want us to continue looking at the business with fresh eyes as things open up again next year. On the people management front, I expect that we’ll continue being more flexible and understanding with our employees, many of whom appreciate the flexibility offered by working remotely. We’re learning to balance that with the needs of our business because we have full teams manning our command centers for Virtual. I also think that our business has to adapt to the trends that have accelerated rapidly due to COVID-19. In 2017, I had predicted that by 2030, “third places” would be the No. 1 preferred workspace category, and I now think that will happen in 2025. I had said that the average commercial lease term will approach one year in 2040, which I now think will be 2035. Smart buildings are also going to be part of our lives a lot sooner than I initially thought. Much of what we’re focusing on is accelerating our approach to meeting and event venues and flexible workspaces in order to meet this fast-approaching reality. Most importantly, our team has supported one another this past year. It hasn’t been easy, but I’m proud of how we’ve shown up for each other.

***

NAME: Nelson Stabile
JOB TITLE: Principal of Integra Investments
SECTOR: Multifamily
CITY: Miami
YEARS IN CRE: 20

In 2021, we will continue to place value on boutique buildings with high walkability scores and access to a variety of around-the-clock services. With health and wellness at the top of people’s minds, commercial and residential developers are incorporating more open, distanced spaces that allow them to cater to the new climate. Specifically, there is an emphasis on untapped products that merge single-family home features with Class-A multifamily amenities. Regarding retail, our focus will be on assets that appeal to a service-oriented tenant mix in high-barrier-to-entry markets. As we look forward to 2021, our firm will become even more conservative as it pertains to cash flow preservation, as this pandemic has shown us the importance of well-capitalized businesses and real estate investments.

***

NAME: Quency Phillips
JOB TITLE: Development Engagement & Community Partnerships Manager at Lendlease/Google Development Ventures
SECTOR: Development
CITY: San Francisco
YEARS IN CRE: 6

2020 has been the perfect lighting, set and scene for our “equity play” in development. The pandemic has forced us to reassess all that we know, and in our business, it has shown the importance of affordable housing and how we place standards around health and social sustainability efforts across the globe. Social injustice and Black Lives Matter movements could not be ignored, and we responded with the creation of the Diversity and Inclusion Council for the Americas to begin to hold ourselves accountable as global leaders in development. We are not looking to be applauded, as we all can do more. It’s up to us to keep the pressure on one another so that we all are leaders with no desire to follow the standards of our past.

***

NAME: Bobby Turner
JOB TITLE: CEO of Turner Impact Capital
SECTOR: Social impact investing
CITY: Santa Monica, California
YEARS IN CRE: 28

More than any other year, 2020 put a spotlight on how fragile our most vulnerable populations are to unforeseen emergencies, and [on] the urgent need for private investment to help strengthen these communities at a time when government and philanthropy are falling short. That includes investing to preserve affordable housing for families as our historic housing crisis continues to worsen. And finally, the demands for justice following the killing of George Floyd underlined the moral imperative to continually extend opportunity to those who have historically been excluded, particularly in underserved communities. In terms of running our business, the year has reinforced the importance of proactive leadership and open, transparent communication. Being distanced from one another during this dramatic period has only increased the importance of asserting the values our firm stands for and the need to stay closely aligned with all of our stakeholders — from employees to investors, lenders, tenants and partners. We will be doing even more in the future to keep communications channels open and active, in all directions. And finally, the year has driven home the need to stay nimble. I’ve experienced a number of crises over my 30-year career, beginning with the stock market crash of 1987. Each time, I’m reminded of the importance not only of IQ but also AQ — adaptability quotient. The ability to stay flexible and resilient in uncertain times — both to seize opportunity and to adjust course when necessary — is ultimately what differentiates those who thrive during a crisis versus those who merely survive.

***

NAME: Chris Charnas
JOB TITLE: CEO of Links Capital Advisors
SECTOR: Land brokerage
CITY: Chicago
YEARS IN CRE: 30

As a CRE broker specializing in golf course sales, 2020 started with the golf course industry shutting down and ended with it having the best year in 20 years. The impact on the golf industry from COVID was remarkable. With golf being one of the few activities that was safe to do outside, the industry flourished in 2020. More people played golf, more people bought golf equipment, more rounds were played and golf course owners had their best year in over a decade. How this new golf boom will impact golf course sales is anyone’s guess. As a golf course broker, I will need to be attentive to market trends as buyers and sellers sort out the new reality of increased EBITDA and the impact that has on valuation. One trend already materializing is new investors are starting to look at golf as a potential investment, and my business will need to identify those new buyers and assist them in their first golf course acquisition. Here’s hoping the positive change in golf course industry fortunes becomes a long-term trend with increased rounds, revenue and course sales.

***

NAME: Lauren Jennings
JOB TITLE: Vice President of Operations at DCG Strategies
SECTOR: Development
CITY: Oakland
YEARS IN CRE: 6

While 2020 has drawn a lot of awareness to social equity and inclusion disparities such as racism, housing insecurity and economic mobility, our firm has been working in this space for years. 2020 has afforded us the opportunity to leverage the newfound national attention and resources directed at these very issues. As a result, 2020 has expanded our reach in ways we could have never forecasted. Our team has embraced tools that allow us to have a greater impact in the work that we do. The use of electronic meetings, in addition to the business community’s desire to be more collaborative, has allowed us to drastically expand our market outside of California. Moving forward, we refuse to go back to the old way of doing business and instead choose to embrace change.

***

NAME: Ashley Parker
JOB TITLE: Vice President of Richard Bowers & Co.
SECTOR: Office and industrial
CITY: Atlanta
YEARS IN CRE: 21

Things that I thought I controlled were yanked away — some temporarily, some possibly permanently. Many, if not most, of us, in this industry succeed through our efforts to create positive outcomes for our clients, company and ourselves. We especially like being in control. So, personally, I have had to reconsider what are the things that I cannot change and instead go with the flow — and hopefully find ways to grow. In other words, 2020 certainly gave new meaning to the serenity prayer.

***

NAME: Lisa Skye Hain
JOB TITLE: CEO and co-founder of Primary
SECTOR: Coworking/office
CITY: New York
YEARS IN CRE: 10

Given we are in the flexible office space business, we are highly focused on offering our members even greater flexibility, with plans that include office and meeting room use several times per month along with access to partner operator spaces in other boroughs and cities throughout the United States. Post-pandemic, I believe new clients will select space based on cleanliness protocols and an overall feeling of safety at work. We are lucky in that our already-built aesthetic is one that gives people generous space to move around — we’ve never packed members in like sardines.

***

NAME: Gary LaBarbera
JOB TITLE: President of the Building and Construction Trades Council of Greater New York
SECTOR: Construction/development/labor union
CITY: New York
YEARS IN CRE: 25

The safety of our members and of all construction workers has always been a foremost priority for the unionized construction industry. The pandemic reinforced how critical these safety measures are to the success of the industry, but it also broadened the sanitary health and safety protocols that workers should come to expect on the worksite into the foreseeable future. While this year has been exceptionally challenging for construction, we’re proud of the unprecedented and historic agreements we reached with the real estate community and union contractors that will bring long-standing benefits to the industry and ensure that the sanitary health and safety of workers always remains paramount.

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NAME: Charles Krawitz
JOB TITLE: Vice President and Head of Commercial Lending and Loan Trading at Alliant Credit Union
SECTOR: Commercial Lending
CITY: Chicago
YEARS IN CRE: 30

Above all else, 2020 has underscored that we can ill afford to “give away the shop” in terms of lenient deal structures, even when a loan proposition seems ultraconservative. Rather, we have learned that it behooves both the borrower and lender to keep some money on the sidelines to hedge against a macro calamity akin to the 2020 COVID outbreak. The ability to weather a storm cannot be understated, which means that debt service escrows ranging from six to 12 months’ worth of loan payments are here to stay.

***

NAME: Ryan Smith
JOB TITLE: Vice President of Venture Commercial Real Estate
SECTOR: Retail brokerage — project leasing (landlord specialization)
CITY: Dallas-Fort Worth
YEARS IN CRE: 10

We have to be a lot more creative than we have been in the past, especially when managing deal structures. There is clearly uncertainty about the next 12 months. Tenants are uneasy about committing, and they don’t know if another shutdown period is around the corner and how long that will last. Landlords want to be more conservative on who they want to take a chance on. Both sides have strong concerns, so I feel like I am in the middle making sure the communication is as fluid as possible. Recently, I have been a lot more hands-on with my landlord clients, planning, budgeting and determining TI allocations. Technology has been critical. In spaces where I have vacancies, I am getting interior shots of all of the spaces and trying to anticipate the questions that are going to be asked because travel continues to be an issue, so being able to show everything you can on a website or in an email is important. We are having to get creative with the ramp-up period. Free rent was something that wasn’t necessarily negotiated with tenants, but tenants may say I want six months’ rent free now when committing to a new deal. I am starting to push back on landlords’ expectations of rent, and we are starting to see the tenant improvement dollars that we are allocating go up 10% to 15% from last year because the tenants have less cash available and lending scrutiny has increased despite lower demand.

***

NAME: Greg Maloney
JOB TITLE: CEO of JLL Retail
SECTOR: Retail
CITY: Atlanta
YEARS IN CRE: 25

There is no question that COVID-19 has brought change at an unprecedented rate to the retail industry and will have a lasting impact on consumer behavior. But bright spots continue to emerge as consumer sales are already back to pre-pandemic levels, albeit dollars are being spent differently. When retail stores shuttered in March and April and consumers stayed home, there was a clear shift toward essentials such as groceries and health supplies and a reduction in discretionary spending on entertainment, dine-in restaurants, gyms and department stores. Now, in some parts of the country, we are starting to see foot traffic at physical retail tick back up, especially during the holiday shopping season where ship-to-home volumes are putting increased pressure on supply chains. It’s important to note that the pandemic in most instances has not really been an initiator of new trends but rather an accelerator of ones that had already been emerging. According to a recent JLL report, some retailers will exit the pandemic stronger than before, forced to adapt and evolve their services and operations much faster than under normal circumstances, but it’s no secret that we will lose retailers as well. I expect that retailers with a strong online presence, coupled with strong curbside pickup and pickup-in-store options, will be in the best position to grow and thrive post-pandemic. JLL’s role as we move into a new year and “new normal” will be to continue to offer retail owners, occupiers and investors a one-team approach in helping them reach their goals.

***

NAME: Carmen Hill
JOB TITLE: President of CitiHousing Real Estate Services
SECTOR: Investment sales
CITY: Los Angeles
YEARS IN CRE: 39

In 2021, I will focus on projects for medium-sized investors. There will continue to be demand for the medium class of income properties, considering the low interest rates and favorable tax laws, since I’m not anticipating a significant change in the tax laws for real estate under the new administration. I will focus on properties selling for less than $5M and finding good values outside of the Los Angeles metropolitan area, such as in San Bernardino County.

***

NAME: Guy Windsor-Lewis
JOB TITLE: Founder and CEO of Locale Ltd.
SECTOR: Property management
CITY: Birmingham, England
YEARS IN CRE: 15

Have greater empathy. Understanding that the entire world is going through the same situation as you and appreciating what you can do to help is vital, both internally and externally. This includes listening to clients, encouraging staff to speak up and working together to find meaningful, impactful solutions. 2020 has also taught me to not just innovate and be a cliché. Knowing what will actually work for our clients and showcasing the return on investment enables us to provide the best service possible. In an age of the “emperor’s new clothing”, consistency is important, but it doesn’t guarantee success. I am definitely going to shout loudly and proudly, but in the right places and to the right people. They say hindsight is 20/20, and this year has proved it.

***

NAME: Tim Helmig
JOB TITLE: Managing Partner of Monday Properties
SECTOR: Office
CITY: Washington, D.C.
YEARS IN CRE: 25

Our No. 1 goal is the safety and well-being of our tenants and our employees. We believe that many of the investments we have made to the operations of our buildings, including the expansion of our advanced HVAC filter technology, virtual tour platform, digital document signing and the increased implementation of hands-free technologies, will be a mainstay in 2021 and the foreseeable future. This year has changed the way many companies run their operations, and we are adapting to these policies and preferences to better serve our tenants. For example, we know that some tenants will not need as much office space due to a flexible work schedule, while others will need twice the amount due to social distancing. We plan to move forward into 2021 with continued efforts focused on listening to all of our current and potential tenants and the industry as a whole to create and design safe, innovative and efficient spaces.

***

NAME: Bo Menkiti
JOB TITLE: Founder and CEO of The Menkiti Group
SECTOR: Development
CITY: Washington, D.C.
YEARS IN CRE: 16

The pandemic has shown us that things we could never imagine — like vast swaths of the economy shutting down — could in fact happen. The precedent has been set by these unprecedented times, making it now essential for businesses to anticipate and prepare for it happening again. As a result, there have been very decisive changes and adaptations necessary for businesses to thrive in our new world. The need for flexibility and the ability to adjust on a moment’s notice is now critical. As a business, we have seen an acceleration of the use of technology and swiftly adapted to this new virtual world. For the first time, people are buying homes they’ve only seen over FaceTime and open houses are being held where no one physically visits the house. Community meetings and design charettes are held over Zoom, and our internal teams are now connecting virtually across geographic boundaries. 2020 has also brought to light the work we must do as a country in addressing social inequalities and racial equity in addition to highlighting how international crises like the pandemic affect different communities in different ways. Business leaders are now tasked with taking decisive and direct action while also being challenged to lead with a humanistic approach. This new dynamic has created a clarion call for us as business leaders during the crisis; it has never been clearer that businesses, especially in the real estate industry, play an important role in increasing access to opportunities and equity in our nation’s communities.

***

NAME: Moe Vela
JOB TITLE: Chief Transparency Officer at TransparentBusiness
SECTOR: Consulting (specializes in tech that facilitates remote work)
CITY: New York
YEARS IN CRE: 8

Arguably the most impactful change to the workforce has been the “new normal” of working remotely. This involuntary move to a predominantly remote workforce model has resulted in enhanced productivity, consistent operational efficiencies and a happier and healthier workforce, not to mention substantial savings to the company. In order to remain competitive and attract the greatest global talent, the biggest business behavior change we will see in the future is that businesses will be making remote work an employee benefit and option no different than offering health insurance or paid vacation.

***

NAME: Marshall Mills
JOB TITLE: President and CEO of Weitzman
SECTOR: Retail Brokerage
CITY: Dallas-Fort Worth
YEARS IN CRE: 30

We launched digital marketing for our retail centers to make Weitzman properties and tenants competitive in an e-commerce world. But the pandemic moved digital from the “optional” to the “critical” column. People increasingly make shopping and dining decisions on their devices, and if you are digitally dark, you probably will not survive the consumer-behavior changes caused by COVID. Getting our mom-and-pop and even chain tenants on digital is one focus for us this year and going forward. We’re becoming a consultant for our tenants, from the time they open a new store in a Weitzman center to offering resources and consultative insights on how to set up a digital footprint and how to build their brands in the nearby trade area/communities. That benefits the tenant, and it benefits the center because it leads to increased tenant sales and retention.

***

NAME: David Scherer
JOB TITLE: Co-CEO, Origin Investments
SECTOR: Investment
CITY: Chicago
YEARS IN CRE: 14

We’ve always invested in suburban multifamily, focusing on assets with high walkability scores and convenient access to transportation in expanding job markets. Origin expects to focus more on suburban than downtown projects as we address issues of affordability and changing demographics. We’re involved in projects that allow us to design and build high-quality, garden-style properties at a basis that delivers high-quality, amenity-filled assets that are attractively priced and very rentable. Further, we’ve all witnessed how COVID is changing suburban demographic trends. Even small changes can represent significant shifts. We’ve seen how e-commerce has impacted industrial and retail real estate, despite e-commerce sales only totaling 15%. Ultimately, the current suburban shift could be significant. Yet even if it isn’t, we’re protected by the affordability factor.

***

NAME: Ken Ashley
JOB TITLE: Executive Director of Cushman & Wakefield
SECTOR: Office tenant representation
CITY: Atlanta
YEARS IN CRE: 25

The way tenant rep brokers communicate with their clients and prospects has fundamentally changed — at least for now. The days of hugs, handshakes and in-person lunches are off the table. What tools do we have left for communication and differentiation? Why, social media, of course. Real estate Twitter is amazing and so informative, and LinkedIn is like the best and most thoughtful coffee shop you can imagine. However, only listening in social media is like going to a cocktail party and not talking with anyone. Authentically contributing to a conversation, be it IRL or online, is how brokers are able to do what they are good at: sharing information and hopefully thought-leading ideas. In 2021, I plan to write a lot more. Real estate discussions are THE conversation that executives want to have now, and I plan to honor that sentiment in as many ways as I can. This would be a high bar, but I would hope they will think of me as real estate’s Johnny Appleseed. I want to plant as many ideas as I can with the idea they will grow into real plans of action. And I will share whatever ideas I do have freely and without expectation of my own personal gain.

***

NAME: Michael Silver
JOB TITLE: Chairman of Vestian Global
SECTOR: Tenant brokerage
CITY: Chicago
YEARS IN CRE: 35

As a business owner, the added remote work has been a boon for our productivity. I am able to visit with my colleagues coast to coast and internationally in a very personal way — albeit remotely. In this manner, we are able to function as one company with a single voice and message compared to the past where our offices had created boundaries. Not surprisingly, the commercial office space world has imploded. It is definitely not a good time to be an owner of an office building or represent an office building. As such, the majority of our company time is now spent with clients, from startups to Fortune 500 companies, who are seeking to reduce or eliminate their office space obligations. We have been quite successful at expeditiously getting rid of or reducing space, saving clients significant money. The sooner businesses do this — especially the typical office space user such as law firms, accounting firms, and banks and financial institutions — the quicker they can reap the benefits of reduced costs and overhead. These cost savings can be used to “fund people instead of overhead” and help instill a more productive and healthier corporate culture.

***

NAME: Adelaide Polsinelli
JOB TITLE: Vice Chair of Compass
SECTOR: Brokerage
CITY: New York
YEARS IN CRE: 35

I have been on the phone, calling my clients every day since March. They say, “Don’t waste a good pandemic,” so I heeded that advice by expanding my footprint nationally. As my clients started to move out of the city to find safer, more predictable investments, I formed alliances in other states. Luckily, my firm has coverage throughout the U.S. I got licensed in states where I needed inventory. I have become knowledgeable in other areas with feet on the ground at any given time. 2020 forced me to become more creative and challenged me to find unique methods of being supportive for my clients as their needs changed. I have taken a multifaceted approach and become a one-stop-shop for my clients. I have expanded my business to include advisory, residential sales and leasing, office and retail leasing, as well as debt and equity. Being centered and steady while also available for my clients for moral support, advice and guidance has been critical. I can now do every aspect of my job without the need for any support personnel. Most importantly, I have had to keep up with the news to be able to provide clarity and direction. Reading and learning new methods, technologies, regulations, tax strategies so that I can advise on real estate positioning has become the central focus of my business. 2020 taught us that survival of the fittest is here to stay. The most important lesson is to remain calm and remember that this too shall pass.

***

NAME: Tom Barbera
JOB TITLE: CEO of Industrial Outdoor Ventures
SECTOR: Industrial
CITY: Schaumburg, Illinois
YEARS IN CRE: 27

IOV is very fortunate to be in the industrial market, which has experienced far less disruption from COVID-19 than other product sectors. Further, our niche product within the industrial market almost exclusively hosts what we now refer to as “essential businesses,” so we have been very busy all year. 2020 hasn’t changed the way we’ll “run the business” of sourcing and managing our investments. We’ll continue to use Argus to model our returns, rely on brokers to bring us deals and support our underwriting with comps, etc. From a team interaction standpoint, we have worked more remotely in 2020 but have been in the office since mid-May while observing safe social distances — we’re having anyone with symptoms or who isn’t comfortable coming to the office work remotely. We are clearly doing much more conference calling in lieu of travel and face-to-face meetings than ever before, and I expect that trend to lighten up but not go away in the years to come. As it relates to acquisitions, we are focusing a little more of our resources on e-commerce, last-mile, as I think the entire universe of industrial investors and developers are, but that’s always been in our wheelhouse, so it’s not a paradigm shift in our strategy.

***

NAME: Joanne McNamara
JOB TITLE: Head of Europe for Oxford Properties
SECTOR: Pension fund investor
CITY: London
YEARS IN CRE: 15

Oxford came into the pandemic in good shape, with a resilient, diversified portfolio, a strong team and significant dry powder. The lessons we have learnt in the last year have been invaluable in continuing to evolve and push the business forward. COVID-19 has taught us to exercise patience and humility by acknowledging that we don’t always have all the answers, especially amid unprecedented uncertainty. It has shown how important it is for us to play to our strengths and focus on areas where we have a competitive advantage, such as our global reach, operating expertise, investment flexibility and strong track record. It also helped us accelerate our adoption of technology, enabling us to work effectively and flexibly across our global footprint. Looking ahead, we believe that being creative and agile will be more important than ever in order to take advantage of where we see attractive long-term opportunities, especially in our high conviction strategies including European logistics, UK BTR and European offices, with a focus on life sciences clusters. Diversity and inclusiveness is at the heart of our people strategy. It’s vital that we continue empowering our talent, such as enabling more junior colleagues to take on greater responsibility and providing growth opportunities to the many exceptional people we have in our business.

***

NAME: Alex Elkin
JOB TITLE: CEO of Eastbound Construction
SECTOR: Construction/development
CITY: New York
YEARS IN CRE: 13

Eastbound has always embraced technology to control information and make the construction process more efficient and cost-effective. We have further increased our move into digital technology in the past nine months, implementing this into our daily workflow with contractors and into our client reporting process. At the same time, we remain physically present on our job sites, and we recently established a new office in Manhattan, as we believe the importance of in-person collaboration with our team and with our clients will remain critical in the post-COVID world.

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NAME: David Goss
JOB TITLE: Co-founder and Managing Principal of Interra Realty
SECTOR: Multifamily
CITY: Chicago
YEARS IN CRE: 20

As a leader in middle-market multifamily investment sales, we have had a surprisingly strong 2020 and expect to surpass last year’s transaction total by about 20%. Success came, in part, through our investment in both talent and technologies that made it easier to connect with clients without physically meeting with them. For example, we hired our own in-house videographer and redesigned our digital presentations to make them much more engaging and visual, using drone footage to provide a bird’s-eye view of each property — a perspective investors wouldn’t even get from an in-person tour. Like many businesses, we were quick to adapt to virtual meetings to replace in-person meetings both with clients and colleagues and continue to use those tools. With more of the workday taking place online, we also recognized the importance of using social media at both the corporate and broker level to organically market properties without being too intrusive or getting lost in overcrowded inboxes. Our brokers already had a strong social media presence, and many of them are native users of platforms like LinkedIn and Instagram, but the pandemic made these efforts much more focused, and we’ve seen our followers and engagement increase as a result. While we are all looking forward to a return to normalcy, we recognize the efficiencies offered by tools and practices that were implemented out of necessity in 2020 and expect to keep many of them in place post-pandemic.

***

NAME: Keith Lord
JOB TITLE: President and Managing Partner of The Lord Cos.
SECTOR: Brokerage, design and development
CITY: Chicago
YEARS IN CRE: 33

I get asked all the time “when do we get back to the old norm?” We need to all wake up. There is no old norm to go back to in the future. We are in the new norm and the new norm is different, not defined and a moving target. We are being hit with not just COVID but crime and financially difficult state and local governments. We have social unrest and retail business regulations that change every few weeks. The new norm is not defined and won’t be well past the end of 2021. So, therefore, we all have to be very flexible, reactive and ready to change directions on a moment’s notice. All businesses need to take a hard look at what they do, trim expenses, focus on what makes money, where growth is and how to help our clients … help THEM to stay alive. For retail tenants, we need to look at who can and will survive this titanic consumer spending shift. We need to help tenants understand what similar tenants are doing to adjust their businesses across the country. We need to look at which tenant’s business plan is now outdated and cannot be revised. Will a dry cleaner, indoor high-end restaurant and luxury spa be functionally obsolescent? Movie theaters and performance venues will need to change or they will be closed. Tenants must see the new path for 2021 and beyond. We need to help tenants in any way possible to be creative and change. As a landlord, we need to help tenants every way possible to pay their rent! It is not about concessions, as rent may be only 10% of expenses. It is the management of their business. We need to predict which tenants won’t survive and get backup tenants lined up to replace them. We have to be proactive and possibly lease a tenant out of their space before they close. Relieving them of liability may be the best decision. Tough but appropriate. Most retail is in survival mode.

***

NAME: Jeff Rinkov
JOB TITLE: CEO of Lee & Associates
SECTOR: Brokerage
CITY: Calabasas, California
YEARS IN CRE: 23

While I believe there are many areas where we have changed behaviors, created efficiencies and adapted, the most notable change going forward will be the reverence and appreciation for in-person gatherings and personal connections that are integral to our organization and synonymous with our company. Going forward, we will be driven to add even more value and create stronger connectivity with our clients and professionals at our live events from our annual conference, the Lee Summit, to our quarterly leadership meetings, and at the many industry events we participate in. We will continue to use the digital and virtual tools that have shaped our communications over the last nine months, but we are very much looking forward to collaborating face to face. We now realize the incredible opportunities we sometimes took for granted and look forward to re-creating those and enhancing their positive impact.

***

NAME: Diana Pittro
JOB TITLE: Executive Vice President of RMK Management Corp.
SECTOR: Property management
CITY: Chicago
YEARS IN CRE: 20

2020 showed us that our ability to be flexible is critical to meet the needs and goals of owners, lenders, employees and residents. Key areas of focus for 2021 include technology, a return to limited, safe in-person interaction and team recognition. At the outset of 2020, technology was becoming more prevalent in the property management world, but because of the pandemic, we jumped light-years ahead. While we won’t go back, we will institute a more selective process in choosing platforms to implement. I foresee short-term trials to evaluate programs — whether for leasing, management, tours, events, reporting or marketing — to ensure the features work the way we need them to and don’t offer overlapping or unusable functions. Resident events shifted from large gatherings to virtual or very small, socially distanced events this year. We learned that we need a happy medium, whether for training, tours or events, to ensure we are creating opportunities for people to bond and build a community, which after the long stretches of isolation we’ve been living with is desperately needed. Virtual tours and training will remain, but we will adjust in-person formats as well to augment the virtual options. People need the opportunity to build connections with one another both for work and play, and that happens best in person. Finally, acknowledging and celebrating employee milestones is more critical than ever before. These dedicated essential workers continue to come to work every day and tackle new challenges in an ongoing effort to assist residents with their needs, answer their questions and ensure building maintenance continues, ensuring both residents and team members feel safe. We’ve implemented an RMK Cares program to do this, and we are confident this is also a program that will continue beyond the pandemic.

***

NAME: Charlton Hamer
JOB TITLE: Senior Vice President of Habitat Affordable Group
SECTOR: Affordable housing
CITY: Chicago
YEARS IN CRE: 31

The pandemic magnified the lack of access to fast and reliable internet service in low-income communities. As a result, future affordable housing developments must include infrastructure for families to function and prosper in the new live-work-study environment. Automating processes for certification and documentation for residents within tax credit and rental subsidy programs was underway but will be accelerated at all our sites to simplify this historically “high-touch” endeavor. Working from home will be normalized as we emerge from the pandemic. New developments will work to create more space within communities, and we will seek to create suitable coworking spaces. Cleanliness, installing disinfecting areas and hand-washing stations will continue to be standard. Habitat has always been a diverse company, and we still believe our diversity is an advantage. However, we refuse to remain stagnant. Because of the recent attention to justifiable social grievances, we dedicated time to listen to our team members and their concerns and empathize with those aggrieved. As a result, we established internal protocols to ensure we exude respect for all humanity and continue to identify opportunities to make a positive impact on marginalized people and communities.

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NAME: Kimberly Dowdell
JOB TITLE: Principal of HOK
SECTOR: Architecture
CITY: Chicago
YEARS IN CRE: 16

We’ve learned to harness the power of technology to do our work in ways that we couldn’t fully imagine before. Going forward, when we do return to our physical office space, we will do so with greater flexibility to accommodate participation in all aspects of our work both as design teams and with clients. Inspired by Black Lives Matter, we took a hard look at what we can do to counterbalance the forces that perpetuate inequality of any kind, but particularly racism. We are working closely with our firmwide leadership to ensure that we’re doing our part to support a more diverse pipeline of talent in joining the architecture profession and making sure that all people feel like they belong at HOK throughout their career with us. We are also rethinking how to optimally engage with a wider and more diverse pool of consultants to support our project work. Going forward, our business will continue to be grounded in open and productive communication, flexible space usage and building equity in our practice and beyond.

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NAME: Manish Chande
JOB TITLE: Senior Partner of Clearbell Capital
SECTOR: Private equity investor
CITY: London
YEARS IN CRE: 25

The pandemic was something that no one could have predicted. As a result, normal activity was brought to a halt overnight. At Clearbell, our immediate focus was on reviewing our existing investments with a critical eye and looking at the sensitivities of those investments — including rent collections, debt and, importantly, supporting tenants where needed. We also spent a lot of time in 2020 looking at opportunities as a result of the pandemic, both in terms of acquisitions but also where we could create value within our existing portfolio. We will take a lot of learnings from this going forward — most importantly, we’ll try to always expect the unexpected! Our priority for the year ahead will also be making sure we have sufficient ballast in our investments to help ride through any future seismic shocks like the pandemic. This includes taking a conservative approach in terms of our investments, as well as debt. There has also been an increased recognition through the pandemic that property values are only what you can grow on the investment. Therefore, in 2021 our investments are likely to be focused on areas where there is a sustainable, long-term expectation of growth and which include flexibility, sustainability and a sense of community within them. We have also learned that being conscious of your customer base is as important as ever, with opportunities to capitalise on treating a tenant as a customer. Finally, the wellbeing of our team has been prioritised above all else in 2020, and this will continue to be our primary concern.

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NAME: Scott Rechler
JOB TITLE: CEO of RXR Realty
SECTOR: Developer/landlord
CITY: New York
YEARS IN CRE: 31

In many ways, COVID was an accelerant of innovation and obsolescence, fundamentally altering the way people will live, work and play in urban environments. From remote working to e-commerce to telehealth, 10 years of innovation was developed in just the last 10 months. Simply put, we will not be returning to what once was. This acceleration and disruption forced us to reposition nearly every aspect of our overall business strategy. The megatrends emerging from COVID will create outsized demand for certain types of real estate such as logistic facilities or Class-A office space with modern infrastructure, while other types of real estate such as movie theaters or older office buildings unable to meet the standards required in a post-COVID world will quickly become competitively obsolete. Health and wellness as prerequisites are here to stay, even with the introduction of a vaccine. So, while it will take time to get COVID-19 fully under control, we should all be prepared for future pandemics still to come (e.g., COVID 20 and beyond). New York City’s energy took a hit this past year, but its adaptability — transitioning from seaport to industrial center to financial capital to technology hub — is as strong as ever. As Charles Darwin noted, it is not the strongest who survive but the ones most adaptable to change, and as a company tethered to the world’s greatest city, we will continue to recalibrate to this new reality.

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NAME: Martin Muoto
JOB TITLE: Managing Director of SoLa Impact
SECTOR: Impact neighborhood investment/affordable housing
CITY: Los Angeles
YEARS IN CRE: 15

With everything that has happened in 2020, we realize that the world is even more interconnected today than ever before. For years, we have built and operated multifamily apartments in Black and Brown communities of Los Angeles. We have learned a tremendous amount about how to invest with intention and inclusion. The events of the summer not only highlighted the need for broadening that platform, it demonstrated that in order to protect everyone, you must take care of the most vulnerable of society. We hope the country, and the world, remembers the lesson as we revert to a new normal.

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NAME: Roger McCarron
JOB TITLE: President and CEO of Project Management Advisors Inc.
SECTOR: Development management
CITY: Chicago
YEARS IN CRE: 25

This year has underscored the importance of our role and the perspective we provide to the development process as an owner’s representative. We’re comfortable where risk and ambiguity are part of the status quo. Our job is to partner with our clients — owners, investors, developers and end users — assess the whole picture, and make realistic plans to capitalize on opportunities and minimize problems, especially in the face of uncertainty. This practice is long-standing and central to our approach. 2020 reinforced our commitment to delivering agile guidance that will keep us nimble in 2021 and beyond. While every project is unique, successful outcomes depend on processes that are repeatable and customizable. We’ve embraced remote work while staying close as a team, finding opportunities to collaborate across 150-plus active projects and a growing national footprint. We’ve ramped up the frequency and efficiency of check-ins to foster collaboration, generate new ideas and identify novel approaches. Fundamental to our business is diversity in terms of clients, project types, markets served and geographies we reach. It not only helps protect against volatility but strengthens our thinking across projects.

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NAME: Scott Malkin
JOB TITLE: Founder and Chairman of Value Retail
SECTOR: Outlet malls
CITY: London
YEARS IN CRE: 25

The moment has arrived for us to plan for life after the pandemic. This is our time to anticipate the challenges and opportunities that lie ahead of us. Not only have the old ways of doing things come unglued, but those companies that have found a path through the chaos of the coronavirus have begun to adapt to what comes next. There is no choice but to “lean in.” Organisations built on agility and resilience will benefit from a diversity of inputs (skills and styles) and from a calm and objective view of evolving technologies. It will be necessary for all of us to be totally focussed on adding value every day. The status quo has been disrupted, which is incredibly exciting. Gradatim Ferociter.

***

NAME: Flip Howard
JOB TITLE: Principal with WorkSuites
SECTOR: Coworking, flexible office provider
CITY: Dallas-Fort Worth
YEARS IN CRE: 20

Every company right now is rethinking their workspace. It seems obvious to most people that flexible workspace will play an even bigger role in the post-pandemic economy. At WorkSuites, we are already seeing a dramatic increase in demand for hybrid and part-time office solutions, as well as corporate demand for short-term space. The silver lining of 2020 for us was that it forced us out of complacency and status quo and it caused us to think outside the box. We were forced to pivot and streamline many core areas of our offerings and our operations, and many of the changes we made turned out to be things we should have done a long time ago.

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NAME: Lisa Davidson
JOB TITLE: Vice Chairman, Director and Chief Diversity Officer of Savills
SECTOR: Leasing, workplace strategy
CITY: Chicago
YEARS IN CRE: 35

2020 has fundamentally changed the way I will run my business, similar, I’m sure, to other executives. I will likely incorporate a work-from-home day, probably on Fridays, and I will utilize technology more than ever before. I will use videoconferencing tools such as Zoom for meetings not being held in Chicago in place of travel. I will also use Zoom to have more “face-to-face” conversations with clients and colleagues versus a phone call and to preview/evaluate spaces before seeing them in person. Bottom line — I’ll be using technology more aggressively to recapture my time and be more efficient. Hopefully, I can use the extra time for my own personal health and wellness.

***

NAME: Wendy Berger
JOB TITLE: CEO of WBS Equities
SECTOR: Industrial
CITY: Chicago
YEARS IN CRE: 28

At the very beginning of the pandemic, when so much uncertainty was swirling, I crystallized my thinking around three approaches to my business and to life. First, a humanity-first approach. Second, we will be a part of the solution, not a part of the problem. Third, that we would stay focused and be an economic engine, keeping people employed and creating new jobs through new real estate development projects. These guiding principles, on top of our core values, have kept me fired up and working each day with a sense of urgency and intensity. This is a time where leadership is critical, and 2021 will be no different. Crisis leadership is innovation on steroids. I will continue to push for innovation in our thinking, problem-solving and the way we look at projects. We will listen more intently to our tenants and prospects and try to be their partner in structuring transactions that are solution-oriented. On the more personal side, I am going to try to encourage my team to find a good work-life balance. We are not going back to our offices until I hear from the scientists that it is safe for us to do so, as we are among the most fortunate, those who can work from home with no hardship. As a result, I think we have all been working more hours than ever. I want my team to find joy and meaning in each day. I think we will all use just a bit less toilet paper.

Embracing the World of Outdoor Workspaces

December 14, 2020 by Sachse Team

The pandemic has permanently changed the way commercial buildings look and function—and the change went beyond their edges and layouts. Landlords, developers, architects and property managers are now observing and analyzing the way office users engage with the landscape, aiming to “meet emerging customer needs around workplace optionality and wellness,” according to Charlie Hobey, managing director of product and operations at EQ Office. And COVID-19 has definitely contributed to accelerating this trend.

But even before the coronavirus hit, EQ Office was reimagining the workspace of the future by integrating functional outdoor spaces at two of its Southern California projects. Last year, the company teamed up with architecture firm RIOS to redesign the 1.4 million-square-foot Playa District in Los Angeles, “transforming a typical high-rise campus of towers and converting the large security-focused lobbies into lounges and centers for informal working to compensate for the enclosed towers above,” said Mark Motonaga, creative director at RIOS.

While some initiatives date back to pre-pandemic times, others—such as Rosslyn Business Improvement District’s O2—were powered by necessity, with a focus on helping businesses and the local community overcome pandemic-induced challenges. Rosslyn BID President Mary-Claire Burick believes that safe outdoor public spaces are paramount to “maintaining mental and physical health, and helping people feel connected to where they spend their time.”

Rosslyn, Va., is home to multiple Fortune 500 companies and small businesses, “so creating an outdoor office space to bring people together in a safe and positive environment felt like the perfect initiative,” she noted.

PREVENTION THROUGH DESIGN

While tech powerhouses such as Google, Shopify and Facebook extended their remote work policies and are expected to decrease their physical footprint, landlords and designers have made keeping employees safe and making offices healthier their top priority. Their other mission is to come up with creative ways to attract people back to the office, one bold step at a time.

Terraces, patios, rooftops and plazas are undergoing conversions into Wi-Fi equipped functional workspaces. According to Burick, Rosslyn BID’s O2 also has a wide array of office supplies, from portable chargers and computer screen shields for when it’s sunny, to blankets and an easel and whiteboard for brainstorming sessions.

“Investment in outdoor technology will become paramount, in addition to outdoor-designed furniture. I think infrastructure for shading, cooling and heating outdoor work areas will also become more desired,” Motonaga added.

These amenities, combined with safety protocols such as physical distancing, in-depth surface cleaning, facial coverings and one-way flow of traffic, will likely encourage office users to give outdoor workspaces a try. Additionally, the installation of large operable doors allowing private workspaces to open and engage with private balconies or courtyard decks allow occupants to work in an indoor/outdoor space. “Large exterior fans keep air circulating in these exterior spaces to mitigate the climate of the city, while also bringing a familiar vernacular language to the space,” Motonaga further explained.

The outdoor space also allows businesses to get creative with the layouts. Inspired by Costa Mesa’s boat-building past, EQ Office’s CANVAS project includes an outdoor workspace named The Boathouse. “The walls of the space are locally sourced vintage sails, bringing a unique element of history to the campus. It also features an eight-person conference table, outdoor AV systems and outlets, as well as presentation and video conferencing capabilities to allow for productivity and creativity in a relaxed environment,” Hobey mentioned.

GREEN IS IN

To further enhance productivity and a feeling of well-being in connection with nature, an increasing number of office spaces feature biophilic elements, which are a rapidly advancing trend. “We designed these outdoor workplaces with employee wellness in mind, where natural light, air and outdoor space bring a residential and hospitable sensibility to the workplace environment,” Motonaga said. And the idea is catching on.

For the Playa District project—an office campus that used to have an open space surrounded by five towers—EQ Office and RIOS created a new type of space that integrates the gardens rather than the sealed interior spaces. “This open space was divided into outdoor garden work rooms, allowing different groups of people to use them in unique ways to facilitate collaboration. Individual outdoor work areas were created along the edges to provide privacy, while also giving the opportunity to engage with people nearby,” Motonaga added.

Meanwhile, Rosslyn BID’s O2 made the best of all the space Gateway Park has to offer, while leaving the grassy area open. The space encompasses six distinct workspaces for one or two persons or areas for groups in need of physically distanced meeting space.

“We have the Field Office, which is a group of cubicle spaces separated by greenery walls; The Pod, a group of physically distanced, single-seat workspaces; The Row, a group of single-user standing workspaces; and the Corner Office where we have counter chairs and more single-seat workspaces,” Burick explained.

NAVIGATING OBSTACLES

COVID-19 created multifaceted challenges for the office sector, the biggest one being the shift from centralized offices to remote work. When asked about the hurdles they’ve encountered when deciding to take the workplace outside, Hobey and Burick identified the weather as the biggest drawback, followed by internet connectivity.

From a design standpoint, Motonaga mentioned the relationship to the ground and landscape. “It should be guided by the life of the user, without viewing the architecture as a machine or commodity. Another challenge is to design the exterior open spaces that adjoin and surround any outdoor work area to create a sense of place and intimacy that make the act of working possible. Lastly, it’s important to understand the nature of the work you are trying to promote and how the community will ultimately use the space,” he added.

STEPPING OUT INTO THE FUTURE

Once people are allowed to return to the office, the largest part of them will want to embrace a hybrid work model, according to a recent JLL report. This translates into a new and diverse mix of work locations and work schedules, paving the way for an increasing number of projects with elements of outdoor work.

According to Hobey, “outdoor offices will likely become more of a fixture in the corporate world as employees continue to express needs for flexibility and mobility, especially amid the pandemic.” EQ Office’s Hughes Center in Las Vegas and Fifth Third Center in Nashville, Tenn., are illustrative of this trend. The company has already converted underutilized exterior areas and added functional outdoor workspaces as an amenity.

This trend is here to stay, but so is the indoor office—although not as we knew it. Hobey believes that “the office will go wherever people want to concentrate or collaborate,” while Burick thinks that outdoor workspaces “have the potential to be more integrated into employees’ daily lives.”

This synergy will set the stage for a stronger and health crisis-proof office landscape, with the outdoor working experience expected to gain more popularity. “Prior to COVID-19, we were seeing an increased need for optionality around the way our tenants work and this has certainly become paramount since March,” Hobey concluded.

Month: December 2020

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Embracing the World of Outdoor Workspaces

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STEPPING OUT INTO THE FUTURE

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