Mariwyn Evans writes about commercial real estate for REALTOR® Magazine. You can reach her at firstname.lastname@example.org.
March 2009: Commercial News Roundup
News briefs to keep you in the know about the commercial real estate industry.
March 1, 2009
Bucks Beat Buildings
When commercial practitioners say they prefer greenbacks over properties, it sends a message about the uncertainty felt in today’s market.
CCIM Institute designees and candidates who responded to a recent survey gave a clear preference to cash over real estate and other investment types. On a scale of one to 10, cash topped the list with a rating of 6.7, compared with 6.1 for commercial real estate. Stocks were rated lowest at 3.4. This was the first time in six quarters that commercial property hasn’t top the rankings of investments.
If respondents were to buy a property, apartments would be their investment of choice. When asked to rank various property types, apartments won the highest rating of all sectors for both return vs. risk and value vs. price.
Findings for the RERC Institutional Investment Survey and the RERC/CCIM Investment Trends Quarterly covered the period ending Sept. 30.
Be Nimble to Be the Best
The real estate market is in a constant state of evolution. Today’s conditions may seem tough, but there will always be new challenges to overcome, says Christopher Lee, president and CEO of Los Angeles–based CEL & Associates Inc. "The ability to harness the incredible power of change distinguishes the good from the great... and the great from the outstanding," he says in his new book, From Good to Great to Best in Class: A Real Estate Leader’s Guide to Optimal Performance (2008). Here are some of his tips for staying ahead of the curve:
- Shift to a customer-centric business model. Continuously seek feedback from and share knowledge with customers.
- Encourage innovation. "Change killers" have no place in your organization.
- Hire talent, not employees. When faced with experience versus talent, always choose talent. But cultural fit matters, too.
The book, published by the Institute of Real Estate Management, concludes with 50 predictions on how the industry will change in the next decade. Among them: A rise in "guest-like" services in multifamily buildings, celebrity-branded timeshares, a major consolidation of REITs, and a wave of new construction technologies that will drastically reduce the time required to build.
Purchase the book at www.irembooks.org or by calling 800-837-0706, ext. 4650. Cost is $47.95 for IREM members and $59.95 for nonmembers. Shipping is extra.
LEED Rating System Evolves
The U.S. Green Building Council has updated its LEED green building rating system to reflect increasing global concerns over climate change and the fact that environmental issues, just like real estate itself, are tied to location.
Under the new LEED 2009 rating system, which takes effect in March, regional credits have been introduced to give priority to green initiatives that are of particular importance to a building’s environmental zone. For example, buildings located in more arid areas might receive extra credits for water conservation.
Among the most significant changes in the new rules: Credits have been reweighted to give additional points for building systems and materials that contribute more directly to greater energy efficiency or lower carbon emissions. This will "increase the importance of green building as a means of contributing immediate and measurable solutions toward energy independence, climate change mitigation, and other global priorities," according to USGBC.