Last Saturday I took a long walk in New York on the way to meet a friend for dinner at my new favorite place, Spasso. A street person was holding a sign. It said, “Trying to Live.” It struck me as a very simple yet powerful statement. When I was in Venice recently for the INREV conference some of my European friends said, “Well, it seems like things are much better in the U.S. these days.” I said, emphatically, “No, they’re not." Case in point: If things were good or at least better, why would a recent NY Times/CBS poll results show the “Nation’s Mood at Lowest Level in Two Years. Americans are more pessimistic about the nation’s economic outlook and overall direction than they have been at any time since President Obama’s first two months in office, when the country was still officially ensnared in the Great Recession.” I bring it up as an example of how something can be misunderstood from a distance. We only know what we’re told by mass media. That is, unless we make the effort to go beyond those sources to more reliable authorities, such as the people that are really involved or close to a situation. That guy with the sign on the street is as close to the situation as is humanly possible. When are we, as a society, going to push our elected officials to really do something to help America and Americans? Who put us in charge of taking care of the world? If we have to spend gazillions of dollars, how about spending them here? On job creation. On education. On cancer research. On Aids research. On affordable housing. When we file our tax returns, why can't we check boxes and tell the government where we want our tax dollars to go and where we don't want them to go? How about that for an idea?
Here’s a link to the 1Q2011 Real Capital Rewind, an audio file where Peter Slatin, Editorial Director interviews Bob White, president and Dan Fasulo, managing director of Real Capital Analytics about what went on in our industry during the first quarter of 2011.
A few doors south of the aforementioned Spasso on Hudson Street, is a small storefront. I was drawn into it the other night by an intriguing window display. I walked in and saw books, hardcover books, stacked on tables and filling wall unit shelves. There were two girls and a guy in the back of the store and as I stood there, trying to figure out what I had wandered into, the guy asked me if I needed any help. I said, “Give me a minute.” So, in that minute, I realized that all the books were I-dentical (“My Cousin Vinny”). It was then that I engaged the young man in conversation. So, here’s the story. A guy named Andrew Kessler wrote this book called Martian Summer. From the website, “Martian Summer is a non-fiction account of author Andrew Kessler’s time spent working on the Phoenix Mars mission. It’s about winning the nerd lottery--getting the most exclusive ticket to work inside mission control for a NASA mission to Mars. The luckiest fan boy in fandom gets a shot to spend three months with unfettered access to mission control--that’s a journalistic first and potential NASA no-no. It’s just your average summer trying to capture the story of 130 of the world’s best planetary scientists exploring the north pole of Mars. It’s a warts-and-all look at the Phoenix Mars mission and NASA’s space narrative from a regular guy who once dreamed of leaving the planet.” I’m reading it now and it’s very interesting and engaging and Andrew has a great sense of humor. What I’m writing to you about is his marketing of the book in that storefront. The landlord, sitting with a vacant store has lent it to him. He has friends volunteering to work the store. And, having hundreds of just one book with signs like, "Staff Favorite", well, it’s creative. After talking with the guy in the store for about 15 minutes I decided to buy a book. He asked me if I’d like it autographed. It was then that I realized that I had been talking with Andrew himself. We continued on for another 15 minutes. Anyway, if you’re in the neighborhood, stop in. The display is a trip in itself and while the book is available at bookstores, I like the idea that I gave the money (cash only, thank you) directly to the guy who wrote it.
A few doors south of the aforementioned Spasso on Hudson Street, is a small storefront. I was drawn into it the other night by an intriguing window display. I walked in and saw books, hardcover books, stacked on tables and filling wall unit shelves. There were two girls and a guy in the back of the store and as I stood there, trying to figure out what I had wandered into, the guy asked me if I needed any help. I said, “Give me a minute.” So, in that minute, I realized that all the books were I-dentical (“My Cousin Vinny”). It was then that I engaged the young man in conversation. So, here’s the story. A guy named Andrew Kessler wrote this book called Martian Summer. From the website, “Martian Summer is a non-fiction account of author Andrew Kessler’s time spent working on the Phoenix Mars mission. It’s about winning the nerd lottery--getting the most exclusive ticket to work inside mission control for a NASA mission to Mars. The luckiest fan boy in fandom gets a shot to spend three months with unfettered access to mission control--that’s a journalistic first and potential NASA no-no. It’s just your average summer trying to capture the story of 130 of the world’s best planetary scientists exploring the north pole of Mars. It’s a warts-and-all look at the Phoenix Mars mission and NASA’s space narrative from a regular guy who once dreamed of leaving the planet.” I’m reading it now and it’s very interesting and engaging and Andrew has a great sense of humor. What I’m writing to you about is his marketing of the book in that storefront. The landlord, sitting with a vacant store has lent it to him. He has friends volunteering to work the store. And, having hundreds of just one book with signs like, "Staff Favorite", well, it’s creative. After talking with the guy in the store for about 15 minutes I decided to buy a book. He asked me if I’d like it autographed. It was then that I realized that I had been talking with Andrew himself. We continued on for another 15 minutes. Anyway, if you’re in the neighborhood, stop in. The display is a trip in itself and while the book is available at bookstores, I like the idea that I gave the money (cash only, thank you) directly to the guy who wrote it.
There’s a guy named Jerry Katell who has been reading OTR for many years. He emails me once in a while, commenting on something I've written and telling me where he is ‘on the road’ and, he's in many places. Jerry has been a successful real estate developer, actor and Broadway show producer. This week, he graciously invited me to join him to see one of the shows he's produced, Million Dollar Quartet, which is based on a once in a lifetime, random get-together of Elvis Presley, Jerry Lee Lewis, Carl Perkins and Johnny Cash in Sam Phillips’ famous Sun Studios in Memphis in December 1956. I really liked the show, as did the audience who talked glowingly about it as we all headed out of the theatre. It’s a really good story and the music is stuff we all know and the players are hot. The show is also running in Chicago and London and a touring company is just about to hit the road in the U.S. Jerry is a really interesting and nice guy and it's great that we got to meet through this column. He also mentioned that he and some friends had gone to a very good restaurant in Manhattan called Marea. Coming from Jerry, I'm certain it's a good recommendation. (Btw, Jerry's new show, "Baby It's You", is inspired by the true story of Florence Greenberg, a suburban housewife from New Jersey, who discovered one of the greatest girl groups of all time, The Shirelles, and created Scepter Records, becoming the music industry's first female powerhouse. It opened this week on Broadway.)
A senior Cushman & Wakefield office leasing broker told me that “Office rents in NYC are much stronger much earlier than we expected them to be.” That sounds good but, as I walk around the city, I still see a whole lot of sizable retail space, some in “100%” locations, vacant. They're located mostly on the street level of office buildings. Over the years, some landlords have considered the street level space as 'the gravy' when it comes to renting the 'bread and butter' office tower above, willing to keep rents high and the space vacant until the next tenant who is willing to pay up comes along. The problem is that retailers can only afford to pay a certain percentage of their gross for rent. My mentor, Dick Steinberg at Mall Properties, taught me this lesson years ago. Okay, shopping malls and centers are different than the retail element of an office tower. But, while it differs from from retail type to retail type, unless someone is looking for a showcase store, where they don't expect to make money but are using it as a billboard for their brand (as many designers and other retailers have done on Madison Avenue and Fifth Avenue over the years), landlords who establish unrealistically high retail occupancy costs will either sit with a vacant store or have a revolving door of tenants. But then again, does what the street level of an office tower looks like adversely affect the ability to lease the office space? Any thoughts?
Some years back I did an informal survey asking people two questions: (1) What industry publication do you feel is a ‘must read?’ and “What industry conferences or event do you feel are ‘must attend?’ And, while I haven’t conducted a formal survey in recent years (btw, if you have time please drop me a note telling me your ‘must read’ and ‘must attend’ and I’ll report the results) when an industry event is celebrating it’s 12th year, there’s something that people want happening there. And that’s just the case with The 12th Annual IMN Opportunity and Private Fund Investing Forum (boy that’s a long title) that will be happening in New York on June 1 & 2. I’ve seen the latest attendee list and it’s very strong. Disclaimer: I'm moderating a very cool panel at the conference: LP ASSET ALLOCATION/ROUTES TO MARKET/MANAGER SELECTION. Joining me on the panel are: Edgar Alvarado, Head of Real Estate Equity Funds, Allstate Investments, LLC, Alan Snoddy, Senior Vice President, Church Pension Group; Kathy Jassem, Portfolio Manager, State of New Jersey Treasury; Joe Connolly, Treasurer, Norfolk County Retirement System; Claire Woolston, Consultant, New England Pension Consultants; and, Jerry Davis, Chairman, Board of Trustees, New Orleans Employees Retirement System. So, here’s the deal: OTR people can get a 10% discount off the registration fee. When you register here, use the discount code (sp10). And, if you are going to be there please let me know-maybe we get together for a drink.
Photo: A very clear message in NY.
On the road....
On the road....
May 1-4: San Diego to attend the CRE (Counselors of Real Estate) Conference
May 9-10: Cleveland, OH
May 12-14: North Palm Beach, FL for the annual meeting of the Homer Hoyt Fellows
May 16-17: New York
June 1-2: New York to moderate a panel at IMN's Opportunity and Private Funds Forum
June 6-10: London to moderate a panel at the PERE Forum-Europe
June 15-17: Santa Barbara, CA to attend Opal’s Investment Trends Summit
July 12-13: Beverly Hills, CA to attend the NMS Roundtable (Endowments & Foundations)
These are my views and not that of my employer.
