ICSC Convention / Public Plazas

A friend’s observations from the ICSC Convention

For many years I’ve attended the ICSC (International Council of Shopping Centers) annual convention in Las Vegas.  It’s where virtually the entire shopping center industry gathers once a year to make deals, network and learn about new trends.  While I unfortunately wasn’t able to be there this May, Bruce Johnston of Johnston Real Estate Services – an OTR reader and veteran of 28 ICSC conventions - sent me some observations from his perspective:

• There were more international participants and exhibitors than ever before including some from China, Japan, Korea, the Caribbean, Mexico, Brazil, Argentina, Canada, and across Europe.
• Bruce wondered how much paper gets recycled or tossed. He saw more people with just a tablet and a cell phone… but no briefcase. 
• Grocery and drug center owners are still building way too much satellite store space. Bruce believes the market can’t absorb what exists today, so is confused as to why there is a need for more… except that it makes the pro forma work (until they realize it is going to be vacant for a long time…).
• There’s lots of complaining from landlord and tenant representatives about the workload with no relief in sight. Only the brokers do not complain about being busy.
• Lots of parties, and very few $5 blackjack tables…the economy must be getting better.

My thanks go to Bruce for sharing. And I will add the following thoughts: There is no question about the globalization of the commercial real estate industry as seen in some of the countries represented at the convention.  The comment about paper brought me back to the term ‘paperless’ society that I feel never really came about.  In my opinion it boils down to whether or not a company adopts an environmentally responsible policy.  When speaking about building, if money is available, there is going to be overbuilding.  It seems almost like a law of nature. Bruce commented on people complaining of too much work. Perhaps these individuals have never had the unfortunate luck to experience a ‘lack of work’ in their professional career.  But overall it sounds like the atmosphere at the convention was very upbeat.

Public Places

My son Kevin turned me on to the May 31, 2013 New York Times article called, “A Streetcorner Serenade for the Public Plaza.”  From the article, “…fresh thinking has focused on cheap, quick, temporary and D.I.Y.-style approaches to creating public space — among these, curbside ‘parklets’ in San Francisco and a communal farm on what had been a derelict parcel in the middle of Phoenix. ‘Small steps, big changes,’ said Janette Sadik-Khan, New York City Department of Transportation.”  

While the energy of a city is often what attracts people, sometimes we need a respite from it all.  Across the street from my apartment is a public plaza with tables, chairs and some trees. Spaces like this are scattered around Manhattan, both indoors and outdoors.  These mini ‘sanctuary’ spots exist because the developer of that property asked the city for some type of ‘bonus’ space for their building.  And, even though what I’ve now come to consider ‘my patio’ is surrounded by huge buildings and loads of traffic, it’s amazing how remote it can feel when I’m sitting there, thinking, reading or working.  All of this is pretty and a step in the right direction.  

A friend told me about a radio segment she heard this week that mentioned how lucky New Yorkers are to have the ‘grand-daddy’ of all public spaces, 840-acre Central Park.  As the largest positive interruption to Manhattan’s grid system of streets you can find people doing almost anything on any given day as you stroll through that fabulous park.  I love New York!

Congratulations

Barry Klayman joined BBR Partners as a partner and Chief Operating Officer.

Youguo Liang, on his new job as Global Head of Research, Abu Dhabi Investment Authority. 

In last week’s column I mentioned the newly-launched Citi Bike program in Manhattan.  Thanks to Marty for sending along this photo.

On The Road…

June 11-12:  Chicago, IL

June 13-16:  Felix Family Weekend, Black Mountain, NC

June 24:  Spring Pizza / Drink Thing with a new spirited twist!  

Join fellow commercial real estate folk at:

Joe-G Restaurant

244 W. 56 Street (bet. Broadway and Eighth Avenue)  

6 – 9pm

Famous Joe-G pizza on me – drinks on you 

I look forward to seeing you there!

June 25 – 26:  NAREIM Asset Management and Acquisitions – Summer Meeting, Georgetown University, Washington, DC. 

Sept. 15 – 17:  NAREIM Executive Officer Fall Meeting, New York, NY

Oct.  23 – 24:  PERE Summit New York, NY

Disclaimer  

All content in this blog is created for informational purposes only. Content, which includes all text, photos, video and graphics is not intended to malign any religion, ethnic group, club, organization, company or individual.  Steve Felix makes no representations as to the accuracy or completeness of any information on this site or other information as a result of following any featured link to or from this site.  The intention of this blog is to do no harm in regards to injury, defamation or libel. What is written or shown is not to be taken as fact or absolute.  Steve Felix will hold himself harmless for any errors or omissions in this blog’s information; including but not limited to external link information, translation or interpretation of content or incorrect grammar or punctuation. 

Quotes from IMN / Utopia in NYC?

IMN U.S. Real Estate Opportunity & Private Fund Investing Forum

This week I attended the Information Management Network conference in New York City (along with 899 of my closest friends!).  This event is one of the few in the industry that attracts a true cross-section of commercial real estate industry professionals.  

A sampling of the panel topics included:  Fund Raising, Acquisition Due Diligence, Mezzanine Loan Origination, GP/LP Relations, Regulatory Trends, Multi-family financing, and - my own panel - A day in the life of an LP.  Consider attending their next event if you’re looking for an immersion experience and useful takeaways on the art of raising and investing real estate funds. 

In keeping with my practice of publishing non-attributable quotes, here are some I heard at this conference:

• “When real estate goes up there’s nothing better; when it goes down you’re depressed.”
• “We use 100 basis points as our theme; buying at a 5 cap and selling at a 6 cap is ideal.”
• “Everyone is searching for yield.”
• “The next stop on the capital train is suburban nodes.”
• “We’re going to invest our own money [vs. institutional dollars] and our bet is on New York City.  It may be very pricey but that’s where you’ll get the biggest bang for your buck.”
• “Baring a meltdown in Europe, U.S. pension funds will continue to increase their real estate allocations.”
• “The risk profile of the cash flow is what determines whether an investment is defined as core, value-add or opportunistic.”

The mood and chatter at the conference was optimistic during the breaks.  There’s a lot of positive energy in the commercial real estate space these days.  

Bike to Work (or just around town) 

Manhattan’s very own bike-sharing service called Citi Bike was launched over Memorial Day weekend.  The adoption was instantaneous. Walking the streets over the past couple of weeks, i first noticed the racks appear, and then the bikes arrived.

The scale of operation is in line with the city it serves, with up to 40 bikes available in some locations.  This is awesome!  

An article in Crain’s New York on May 5 offered these comments: “The program sold thousands of memberships last month within the first 12 hours of their becoming available. Landlords are touting proximity to docking stations as a selling point. And while plenty of individuals plan to use the bikes to commute, some companies are even offering annual memberships as a newfound benefit for employees.”  While this may sound utopian I see this program having the potential to positively impact the human body, the city streets and ultimately the planet.  

Curiously, there is no bike helmet law in New York (or 28 other states for that matter) but annual Citi Bike members receive a $10 coupon to purchase a helmet.  Why someone would ride a bike around Manhattan without a helmet is beyond me but I’ve seen a bunch of people doing just that already.  Go figure!

Under Mayor Bloomberg’s administration, designated bike lanes have increased the safety of cyclists. Living in California I learned about the ‘rules of the road’ hierarchy:  Pedestrian, bicycle, car. While I don’t know if that is universally accepted it seems to make sense. Don’t you think?  Several times a cyclist has nearly struck me believing that I should make room for them.  Now people on foot need to be even more alert crossing a city street as it’s not only the aggressive and competitive taxi drivers who are threats but also an increased number of very assertive cyclists who are sharing the road.

I’d love to hear some feedback from anyone who has used Citi Bike.  

Check out their site. 

On The Road...

June 11-12:  Chicago, IL

June 13-16:  Felix Family Weekend, Blackrock, NC

June 24:  Spring Pizza / Drink Thing with a new spirited twist!  Join fellow commercial real estate folk at Joe-G Restaurant, 244 West 56 Street (bet. Broadway and Eighth Avenue).  6 – 9pm.  Famous Joe-G pizza on me – drinks on you. I look forward to seeing you there!

June 25 – 26:  NAREIM Asset Management and Acquisitions – Summer Meeting, Georgetown University, Washington, DC

Sept. 15 – 17:  NAREIM Executive Officer Fall Meeting, New York, NY

Oct.  23 – 24:  PERE Summit New York

Disclaimer  

All content in this blog is created for informational purposes only. Content, which includes all text, photos, video and graphics is not intended to malign any religion, ethnic group, club, organization, company or individual.  Steve Felix makes no representations as to the accuracy or completeness of any information on this site or other information as a result of following any featured link to or from this site.  The intention of this blog is to do no harm in regards to injury, defamation or libel. What is written or shown is not to be taken as fact or absolute.  Steve Felix will hold himself harmless for any errors or omissions in this blog’s information; including but not limited to external link information, translation or interpretation of content or incorrect grammar or punctuation. 

Memorial Day 2013

To those in the United States, please enjoy your long holiday weekend.

I've decided to take a break this week.

Take care and safe travels.

See you next week.

Steve

Manney Felix, World War II Veteran  (1917-2009)

Decisions, Decisions

Decisions, Decisions

It’s pretty incredible, the number of decisions we make on any given day.  Actually, just thinking about it can be exhausting.

What should I wear? Eat for breakfast?  Walk or take the subway to work? Carry an umbrella?  Where to have our company Christmas / Holiday party?  Renew the lease for our current office space or look elsewhere? Is today the day I speak with that underperforming employee?  Accept the invitation from that good-looking colleague in the accounting department?  How will I vote when the investment committee meets about buying that $200 million shopping mall?  Should I sign a three-year employment contract that seems too good to be true?  

Of course, if we don’t make a particular decision, we’ve still actually made a decision…to not make a decision!  But does putting off making a decision help or just prolong the process and perhaps create accumulated stress that moves with us from day to day in a seemingly never-ending cycle? 

Every decision - small, medium or large - has consequences and trade-offs and offers us the opportunity down the line to second-guess ourselves.   Afterwards, we may feel great about the decision, or realize that it may not have been the best choice or the right choice at this time.  In the worst case scenario, we may learn that it really was the wrong decision.  

For many years, in any given week, I have had heart-to-heart career-related conversations with real estate people in different stages of a decision-making process. I am aware how stressful those times can be for someone in transition.  I know from having gone through this process in my own career numerous times – and learning along the way about mistakes I made and try not to repeat!

There are no guarantees in life; we believe we’ve made the right choice at the time we make it.  Only time will tell but remember, we usually have the option to change our minds.  As a counselor once told me, whether it’s a decision that involves millions of dollars or your career or life in general, we do the best we can at that precise moment in time and should trust our instincts.  Yet, it often helps the process to have someone to bounce things off. 

We’re all in this together, people.  We need each other.  When someone calls you, asking for advice, even if you’re really busy, consider taking just a few minutes to talk.  I guarantee that as much as it will help them, you will find it helps you too.  As Bill Withers wrote and sang, ‘Lean on me, when you’re not strong, and I’ll be your friend, I’ll help you carry on.  For, it won’t be long ‘Til I’m gonna need somebody to lean on.” (From the song Lean on Me)

Congratulations…

Philip Hy joins Jones Lang LaSalle (JLL) as an analyst in Guangzhou, China.

Neville Rhone and Quincy Allen on the launch of ARC Capital Partners.

Chuck DiRocco joined Real Capital Analytics as Managing Director.

On The Road…

May 29 – 30:  IMN’s U.S. Real Estate Opportunity and Private Fund Investing Forum, New York, NY.  

    I will be moderating a session called “A Day in the Life of an LP" 

    featuring four distinguished pension fund representatives.  It should be 

    informative and fun! 

June 13 – 16:  Felix Family Weekend, Black Mountain, NC

    (First, hopefully annual, three-generation get-together). 

June 25 – 26:  NAREIM Event, Georgetown University, Washington, DC. 

Beautiful but injured Bald Eagle at the Sharon, Connecticut Audubon Society right behind my Uncle Myron's house which I visited, one last time, this past week just before his funeral. 

Disclaimer  

All content in this blog is created for informational purposes only. Content, which includes all text, photos, video and graphics is not intended to malign any religion, ethnic group, club, organization, company or individual.  Steve Felix makes no representations as to the accuracy or completeness of any information on this site or other information as a result of following any featured link to or from this site.  The intention of this blog is to do no harm in regards to injury, defamation or libel. What is written or shown is not to be taken as fact or absolute.  Steve Felix will hold himself harmless for any errors or omissions in this blog’s information; including but not limited to external link information, translation or interpretation of content or incorrect grammar or punctuation. 

My Last Visit With Myron

Recently I wrote about my last remaining uncle, Myron. It took weeks but I finally heard from his niece, Adrianne, on his wife Connie’s side.  Adrianne has become the conservator and has overseen all aspects of Connie and Myron’s life for almost a year.  

Last Sunday, I drove up to Salisbury, CT to visit Myron.  I was shown to the dining room and was pointed to a table in a corner where a man with long stark white hair sat in a wheelchair facing the wall.  I couldn’t believe my eyes.  One of the attendants announced that he had a guest. I walked around the table so he could see me.  Myron looked up with rather vacant eyes but I could tell, somewhere in the deep recesses of his mind, he was trying to figure out who I was.

I sat down at the table and asked Myron if he recognized me.  I didn’t want to push him and really saw no recognition.  One of the effects of his stroke several years ago was that he speaks in a barely audible whisper and the ‘words’ don’t generally make sense. I left him for a minute and asked the nurse about his condition.  He had not been eating or drinking very much and the nurse felt that he was close to the end. It was difficult to hear those words in such a matter of fact way.  But I guess when you’re in that business professionally it’s different than when you look at someone who you’ve known your whole life and realize what close to the end means.  It’s a sad realization, about Myron, about all of us… 

At one point Myron randomly said, ‘San Francisco.’   That made me smile slightly as for all the years I lived in Napa, CA he never got it out of his mind that I lived in San Francisco.  Those two whispered words made me realize that he may actually know who I am! 

After a while I left him to himself.  I drove back to New York wiping tears from my eyes and thought about the interaction - or lack thereof  - that I have had with Myron over the years.  I am pretty sure that he’s actually my godfather.  I’m not certain what that relationship represents but as my mother’s only sibling, he always had a special place in my heart. 

As I was finishing up this column, I was notified that Myron passed away, peacefully, early Thursday morning.  I hope he’s in a better place.

Myron and his sister, my mother, Lorna (1936)

Republishing with WTC Photo: Sound Counsel / World Trade Center-NYC / The Marketing Brilliance of LInkedin

Sound Counsel

Last weekend a bunch of folks who, like me, count music as an important part of their lives, gathered in a rehearsal studio in New York.  All are musicians from varied backgrounds – jazz, school bands, choirs, blues and rock and roll.  The common thread includes love of music and membership in The Counselors of Real Estate (CRE).   

In many bands, the foundation is the rhythm section (Walt on drums, Ray on bass).  The next layer is the guitars (Anthony, Jay and Noah) and keyboard (me).  Add in vocals (Mary, Noah, Jay, Greg, Anthony, John and myself), horns (Buck, Jim and Neil) and harmonica (Greg) and on this day you have Sound Counsel.  Boy did we have fun - playing songs like Moondance, What I Like About You, 25 or 6 to 4, Jumpin’ Jack Flash, Stormy Monday and other rock and blues classics.  The key was teamwork. There was no ‘star.’  No one was seeking the spotlight.  It was simply a group of individuals who loved music and wanted it to sound great.  

The concept of teamwork is also critical to business success. While Sound Counsel gets together only twice a year, business teams congregate in one form or another every working day.  Both band and work team members should appreciate each other’s talents and contributions – the whole being greater than the sum of its parts. Whether it’s the lead singer or the chief honcho, the importance of teamwork cannot be over-emphasized.  

Rock on Sound Counsel!

World Trade Center-New York

In mid-August 2001, my son Kevin and I took in a live music performance on the plaza between One and Two World Trade Center.  It was a beautiful summer night and I remember us tilting our heads back, looking up at the buildings and commenting on how tall and massive these structures were.  

A few weeks later, on September 11 I was driving to work in California when my wife called me; my father had just called in a panic, “Where is Steve?!?”  She told him I was not flying that day. My Dad was relieved and said that there had been an airplane crash.  I turned on the radio and heard the newscaster say, “A plane has hit the World Trade Center tower.”  I thought this was referring to the radio tower at the top of the building.  A little while later I learned what really happened.  It was simply unfathomable.  And still is today.

Earlier this week I participated in a very special tour of the World Trade Center site in New York thanks to the generous invitation of Clarion Partners.  Walking inside the construction fence was a bit surreal.  I took the picture below from the 43 floor of the under-construction 4 World Trade Center.  The photo shows the almost complete ‘spire’ that will bring the height of One World Trade Center to 1776 feet. (Note:  the spire was topped-off this week).

When the tour was finished, I headed for the subway and noticed how dusty and dirty my shoes had become. Stopping to wipe them off, the ashes of the remains of the buildings flashed through my head. I couldn’t help thinking about the people that innocently went to work that day and never came home.  They just never came home again. But the dust and dirt on my shoes this week represented rebuilding and hope for a more peaceful world.  

The loss of lives on September 11, not only in New York but in Washington, DC and Shanksville, PA was horrific. 2,996 people died that morning.  That number is simply a statistic. The reality is that all of these people were in exactly the wrong place at the wrong time.  Who can figure these things out?

Many have experienced tragedy in their lives.  When it happens, we are turned upside down.  We suffer.  We mourn.  At some point, we do our best to carry on.  This week, walking on that property in Lower Manhattan, the reminder of not taking anybody, or anything, for granted flooded my mind… To cherish every moment we have on earth.  To let those close to us know we love them and are thinking about them.  To be kind to each other.  To hug.  And never forget that the victims of September 11 didn’t have a chance to reflect on such things.  

The Marketing Brilliance of Linkedin

How many of us are on LinkedIn?  Overnight it seems to have become a global, cross-industry standard for making business connections.  As we watch it evolve, some of LinkedIn’s marketing and business development techniques may be helpful to companies looking to bring more traffic to their websites.

Linkedin has mastered the art of increasing visits to their site. First, we were offered an irresistible way to post a profile. Free!  This was coupled with the means to connect with others - those we already knew and those we wanted to know.  Also free! That was pretty cool although I have only recently overcome my resistance to accept invitations from those I don’t know. To increase traffic further - bring on the “Recommendations” – a feature where anyone can ‘recommend’ someone else in a testimonial-type way.  Free. This offers ample opportunity for multiple site visits from the recommender and the person recommended. Then LinkedIn got even smarter and realized that it was taking people too long to complete the Recommendation.  Could they engage more people with a simpler process??  Bring on the “Endorsement.”  Free.  We could then ‘Endorse’ someone for a ‘Skill or Expertise’ simply by clicking a word.  How brilliant is this?? It’s easy and it ‘promotes’ someone else as that person’s network gets to see a new posting announcing the endorsement.  Along with that, the endorser’s photo is posted in the endorsement section, and the endorsee gets to feel good about themselves.  Talk about win-win-win!

The moral of this story is that Linkedin.com continues to do a brilliant job of creating an environment that pushes an emotional button and creates an addiction of sorts.  All social media aspires to achieve this.  The more traffic to the site, the more advertisers are willing to pay.  That’s where the money is.  It’ll certainly be interesting to see the next feature that LinkedIn offers.  Until then……

Congratulations…

Rob Bilse who joined IPD (Investment Property Databank).

On The Road…

May 16:  Annual meeting of The Hoyt Fellows, North Palm Beach, FL

May 29 – 30:  IMN (Information Management Network) U.S. Real Estate Opportunity Fund and Private Fund Investing Forum, New York, NY 

June 4 – 5:  PERE Summit (Private Equity Real Estate Magazine), London, UK 

Disclaimer  

All content in this blog is created for informational purposes only. Content, which includes all text, photos, video and graphics is not intended to malign any religion, ethnic group, club, organization, company or individual.  Steve Felix makes no representations as to the accuracy or completeness of any information on this site or other information as a result of following any featured link to or from this site.  The intention of this blog is to do no harm in regards to injury, defamation or libel. What is written or shown is not to be taken as fact or absolute.  Steve Felix will hold himself harmless for any errors or omissions in this blog’s information; including but not limited to external link information, translation or interpretation of content or incorrect grammar or punctuation. 

RCA U.S. Capital Trends / Park Avenue Sculpture Tours / You Never Know!

RCA (Real Capital Analytics) U.S. Capital Trends

RCA’s U.S. Capital Trends First Quarter 2013 reports were just published.  Here are some of my takeaways: 

Hotels

• Sales of significant hotel properties are up 84% from a year ago
• The hotel sector is increasingly becoming dependent on CMBS (Commercial Mortgage Backed Securities) as its primary source of debt capital
• Sales volumes rose significantly in secondary and tertiary markets

Apartment

• Sales of significant apartment properties totaled $31.7Bn, a new record high although this included the sale of Archstone properties in two portfolios sold to Equity Residential and Avalon Bay
• Senior housing is also off to a strong start in 2013 with transaction volumes doubled from a year ago

Retail

• Sales of significant retail properties were down 30% versus last year
• Positive trend in strip center transactions

Industrial

• Sales of significant industrial properties were up 16% compared to the same period in 2012
• Sales volumes in tertiary markets rose significantly

Office

• Sales of significant office buildings up only 2% from a year earlier
• Acquisitions in secondary markets posted positive trends with volume in tertiary markets up the most 

RCA’s data mirrors what several industry friends mentioned to me just this week.  They and their partners are seeing prices starting to over-heat, even on ‘so-so’ properties in secondary and tertiary markets.  They have been out-bid by as much as 33% and don’t understand how the winning bidders can underwrite to those prices.  While sellers are benefiting, this is another indication of the next real estate bubble starting to inflate.  

Park Avenue Sculpture Tours

Last week I wrote about Alexandre Arrchea’s “No Limits” exhibition along Park Avenue.  Two OTR readers took me up on my offer to view the abstract real estate artwork together. It was such a nice experience to stroll the streets and hear different perspectives.  The weather was beautiful and sharing with others is what made this special for me. 

The real estate person in each of us chose to notice how the artist dealt with the scale of each building and the sense of animation attached to inanimate objects. There is no right or wrong way in which to experience the arts:  it’s all our individual appreciation. The exhibit is located on Park Avenue between 54 and 67 Streets and runs through Sunday, June 10.  My offer to join you on the tour is still open! 

Outdoor Public Art in New York

On a similar note, a friend forwarded me this link which is a terrific roadmap to ‘discovering NYC’s range of al fresco art…from expansive graffiti murals and obscure 19 century statues to iconic public artworks and secret New York treasures.’  Looks like a great spring / summer adventure is unfolding!

You never know….

(Note:  An apology to those of you who think baseball is boring!)

On Thursday a long-time real estate friend took me to Yankee Stadium to watch the Yanks play the Toronto Blue Jays.  There had been some excitement early on but nothing like what happened in the seventh inning. Yankee Ben Francisco was called out on a close play at first base.  There was no dispute of the call yet a few minutes later the umpires gathered for a conference.  The outcome of the pow-wow was a reversal of the call!  No one seated around us had ever seen such a thing. The crowd cheered wildly.  The Toronto manager argued with the umpires to such a degree that he got tossed out of the game.  You can read all about it here.  

Why do I mention this??  Simply to suggest that we never know when something totally unexpected and unusual will happen.  Perhaps the unexpected should be something we actually expect from time to time…  Hopefully the unexpected occurrence will be a good one but that’s not always the case.  When something bad happens we need to choose how to manage the situation.  It’s all about our attitude.  We can argue, like the Toronto manager and get ‘tossed out of the game,’ or just accept what has happened and deal with it in a positive way.  I think that embracing the unexpected and making the best out of the situation is often the healthiest response for us.  Don’t you think?

Congratulations…

• Jaap van der Bijl, Director Investor Relations, Syntrus Achmea Real Estate and Finance. 
• John Bottomley, Executive Vice President - Capital Markets, Berkshire Group.
• Drew Butler forming Butler Global Partners.

On The Road…

May 16:  Annual meeting of The Hoyt Fellows, North Palm Beach, FL

May 29 – 30:  IMN (Information Management Network) U.S. Real Estate Opportunity Fund and Private Fund Investing Forum, New York, NY 

June 4 – 5:  PERE Summit (Private Equity Real Estate Magazine), London, UK 

Disclaimer  

All content in this blog is created for informational purposes only. Content, which includes all text, photos, video and graphics is not intended to malign any religion, ethnic group, club, organization, company or individual.  Steve Felix makes no representations as to the accuracy or completeness of any information on this site or other information as a result of following any featured link to or from this site.  The intention of this blog is to do no harm in regards to injury, defamation or libel. What is written or shown is not to be taken as fact or absolute.  Steve Felix will hold himself harmless for any errors or omissions in this blog’s information; including but not limited to external link information, translation or interpretation of content or incorrect grammar or punctuation.