Real Estate Management News - 11/30/2016

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November 30, 2016
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IREM® HEADLINES
Leading With Labor
Overtime Rule Halted by Federal Judge
Don’t Miss This IREM Webinar on CAM Licensing
Do Credentialed Professionals Earn Higher Compensation?

INDUSTRY HEADLINES
Mixing It Up: Getting Mixed-Use Retail Right
How Owners Can Drive Revenue for Retail Centers Through Innovative Landscape Design
Honeywell Launches App That Gives Workers Access Into the Office Building
St. Louis Joins National Initiative to Reduce Greenhouse Gas Emissions From Buildings
Pepper the Robot Will Be Helping Out Shoppers at Two Bay Area Shopping Centers This Holiday
Seven Fire Safety Tips for Senior Residents
City Struggles to Appease Residents Who Oppose Apartments in Suburbs
Rattlesnakes Like New North Austin State Office Buildings
How Apartment Building Owners Can Strike a Balance Between Pet Owners and Non-Animal Lovers
S.F. Could Require Some Older Apartment Buildings to Get Sprinklers
Holiday Shopping by Mobile Phone? Beware Fake Apps and Bad Wi-Fi Hotspots
DOE Launches 'Better Building Zero Energy Districts'


 
 

IREM Headlines


Leading With Labor

CBRE has released a three-part White Paper series on workplace performance. The first paper in the series, “Aligning the Workforce and the Workplace,” takes an interesting view of how corporate occupiers should choose their market expansion strategies.

(To access all three Papers in the series, go to: www.cbre.com/about/workplace-performance)

“When you lead with labor,” says Rob Marsh, EVP of the firm’s Labor Analytics consulting practice, “organizations can avoid many of the growth challenges they would otherwise face. So think early and think hard about your growth strategy. Do the labor piece first--before you make decisions around location and portfolio strategy--and other things will fall into place to make the business more successful.”

While major gateway cities are always sources of broad and deep labor pools, Marsh and company recommend a look beyond the Top Tier locales for untapped sources of talent, which is clearly at a premium. The White Paper indicates that 38% of employers are having difficulty filling job vacancies and 43% report a reduced ability to service clients as a result.

A strategy based on the location of talent--especially if that means a move to smaller markets--can benefit the occupier in many ways, the report states, not only in terms of labor but also cost. Typical savings could be as high as 30% and the firm reports seeing that percentage rise as high as 70%.

“Though smaller, secondary markets often have a limit to the requirements that can support,” says the report, “they likely represent the next phase of growth for employment. They can deliver quality talent and often offer the pace and amenities that make for a more attractive quality of life. Moreover, given the reduced competition, such markets allow strong companies to become the clear preferred employer.”
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Overtime Rule Halted by Federal Judge

On November 22, 2016, a Texas federal judge issued a nationwide injunction on the controversial overtime rule that was set to go into effect on December 1, 2016. The rule was blocked by Judge Amos L. Mazzant, a Texas federal district court judge who was appointed by President Obama. The rule would have impacted roughly 4.2 million employees by increasing the salary threshold for exemption from overtime pay from $23,000 to more than $47,000 annually. Without the injunction, an employee making less than $47,476 would have been eligible for overtime pay whether they were an exempt or non-exempt employee.

The decision came as 21 states and more than 50 groups sued to block the federal rule from going into effect. The rule was heavily criticized by small business owners who claimed the rule would ultimately lead to employee layoffs. Judge Mazzant found that businesses across the nation may suffer greatly from the rule, and he also had concerns that the Obama administration had exceeded its authority in making this move to double the overtime salary limit.

It is important to understand that an injunction is a temporary pause in the rule’s enforcement. If the injunction is lifted, employers and business owners will be required to pay overtime to appropriate employees. This pay may be retroactively calculated to the original effective date of December 1, 2016. Please be sure to monitor the issue to stay abreast of any changes in this rule to ensure compliance.

To keep up-to-date on how policy decisions can impact your business, check out IREM’s public policy programs, including our new Federal Action Center and State and Local Action Center which allow you to have your voice heard by your elected representatives with just a click of a button.

November is IREM’s Public Policy Awareness Month

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Don’t Miss This IREM Webinar on CAM Licensing

Just like the holidays, CAM season will be here before you know it! If you want to weather the season like a pro, be sure to join us for battle-tested tips designed to help you prepare for your busiest time of the year, in this IREM Webinar Dec. 6 at 3:00 p.m. EST.

Here’s what we’ll cover in this session:

• 7 steps to get you started
• How to find what you’re looking for
• Live examples
• Types of leases & calculations

This session is perfect for new managers, and a refresher for experienced managers. The New Year is right around the corner- don’t miss out!

Shannon Alter, CPM, will lend her expertise as presenter. Alter is a national instructor for both IREM and the American Management Association, and her column, “Marketing Solutions” appears monthly in the Journal of Property Management.

Register now!
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Do Credentialed Professionals Earn Higher Compensation?

The short answer: yes, they do.

For the longer answer, check out the CPM and ARM editions of the IREM 2016 Profile and Compensation Studies.

What does earning a designation mean for property managers? Higher compensation? Bigger bonuses? What trends are property managers seeing over time in terms of compensation, commission, and benefits? Our Profile and Compensation Studies answer those questions, with extensive analysis to demonstrate how a number of variables factor into a property manager’s compensation.

If you are hiring a property manager or promoting yourself as a credentialed member, you need to know: what are the characteristics of those who hold these credentials? The ARM and CPM profiles provide detailed breakdowns on the profiles of our credentialed members, covering statistics like:

• Age
• Years of experience
• Position in company
• Portfolio size
• Race, gender, and ethnicity

This invaluable research can help you determine your market value, help you figure out what to pay your team, and help you understand the current climate and marketplace.

Buy the CPM Edition

Buy the ARM Edition
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Industry Headlines


Mixing It Up: Getting Mixed-Use Retail Right
National Real Estate Investor (11/23/16) Mellen, Chris

Chris Mellen, who serves as 2016 president of the Institute of Real Estate Management (IREM), recalls IREM’s recent fall conference in San Diego in which the topic of how to optimize mixed-use retail was explored. He describes creating successful mixed-use developments as a "highly complex and nuanced initiative." After all, retailers are a "different breed of animal" than any other commercial or residential tenant that property management will deal with. In general, there is just more interaction with retail tenants than with typical apartment/condo residents or office tenants. According to Mellen, who is also vice president of property management for Simon Companies, "one reason is sheer economics and the fact that there's a percentage rent clause in the lease agreement, meaning that there's an additional rent percentage based on any increased sales the retailer makes. So there's an incentive for the landlord or manager to be involved in the marketing of the retail space."

However, there are other reasons why retail tenants are a different breed altogether. Mellen quotes Anjee Solanki, national director of U.S. retail services for Colliers International, who was a panelist at IREM's mixed-use session in San Diego. Solanki stated, "Retailers are very focused on customer experience. They'll walk into a space and ask about the ceiling height, the level of the floor, the column spacing and what's the co-tenancy look like. But their number one concern in mixed use is: 'Who's going to be above me?'" Nevertheless, it is important not to forget a mixed-use project's other tenants, who still need and deserve to experience best practices in tenant relations.
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How Owners Can Drive Revenue for Retail Centers Through Innovative Landscape Design
REBusinessOnline.com (11/22/16) Sloan, Katie

While brick-and-mortar shopping still remains a dominant channel for U.S. consumers, e-commerce growth continues to make inroads at a rapid rate. To remain competitive, retail property owners must adapt their strategies to create shopping centers that cater to the evolving demands of today's shoppers. The majority of consumers that still prefer to make purchases in stores are no longer just searching for places to spend their money. Instead, more and more are seeking multi-sensory environments and experiences that cannot be replicated via online commerce. The question then becomes: How do shopping center owners create these experiential centers that extend beyond the traditional retail experience? One answer is innovative landscape design. Landscape design can play an integral role in cultivating unique experiences and transforming a venue from a cookie-cutter mall to a popular destination of choice. Today's consumers place great value on centers that evoke emotional connection and provide warm, inviting atmospheres that appeal to all senses.

One way that owners can do this is by integrating a series of intimate and large-scale gathering spaces throughout a center's landscaping. At The Point, an upscale lifestyle shopping center in El Segundo, Calif., property management has strategically designed a series of outdoor gathering spaces surrounded by lush landscaping to create both beautiful and intimate environments where visitors can gather, socialize, and shop. Mall owners can further create destinations of choice by integrating unique water and entertainment-driven features, lush and vibrant gardens that serve as focal points, and centralized courtyards that can host an array of events. Pacific City in nearby Huntington Beach, for instance, features a central courtyard on the lower floor with festoon lights, as well as an open area on the upper floor to serve as a multi-purpose space for special events, exhibitions and open-air movies. Almost 40 percent of the property is devoted to landscaping, thus creating an entertainment-driven retail destination that has proven to entice repeat shoppers.
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Honeywell Launches App That Gives Workers Access Into the Office Building
Minneapolis Star Tribune (11/27/16) DePass, Dee

Honeywell's new Vector Occupant app enables office workers to use their cellphones to change workplace temperatures or to gain access into locked buildings when they forget their ID cards at home. According to Honeywell, the cloud-backed app is proving to be a desirable technology because it quickly gives locked-out employees access to their office without needing to call for help or replace ID badges. Employees simply hold up their phone app to the black card readers rather than their plastic ID cards. The app only unlocks doors per the employer's programming. The technology is expected to beef up comfort. By pressing a button, the app lets employees alert facilities managers when a work area is too hot or cold. The managers then press a button to confirm the complaint and click others to remotely change temperature settings, without visiting floors to manually adjust thermostats. The integrated system also enables building managers to identify temperature patterns.

Currently, the Vector Occupant app focuses on just building access and comfort. But it will eventually expand to help employees find their way around a building. The app was developed with the assistance of the security-badge experts at Texas-based HID Global. The system was initially tested using approximately 200 Honeywell employees in Golden Valley. After that, it spread to a half-dozen Honeywell buildings and then piloted at four customer sites in Chicago. London, St. Paul, and Centerville, Minn. It is now ready for sale and making its way around to trade shows worldwide. The app is the latest "Internet of Things" offering from Honeywell, which is known for its temperature control systems. Honeywell is increasingly monitoring and controlling building features with connected devices.
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St. Louis Joins National Initiative to Reduce Greenhouse Gas Emissions From Buildings
St. Louis Public Radio (11/25/16) Chen, Eli; Lecci, Stephanie

According to 2015 data from St. Louis' sustainability office, nearly 80 percent of the city's greenhouse gas emissions comes from buildings. Now, a new partnership with a national energy efficiency initiative could help St. Louis address the impacts its buildings have on the environment. City officials recently joined the City Energy Project, a joint initiative by the Natural Resources Defense Council and the Institute for Market Formation that provides funding and resources to cities to create programs that improve energy efficiency in buildings. St. Louis expects to receive more than $500,000 in assistance from the project. "In tackling our greenhouse gas emissions from existing buildings, a program that focuses on existing buildings is going to help us achieve some of our climate protection goals and objectives," commented Catherine Werner, the city's sustainability director.

The city offers commercial buildings owners the opportunity to take part in its Set the PACE program, which finances energy efficiency, water efficiency and renewable energy projects, for building owners and operators. Best of all, the city recently expanded Set the PACE to include residential buildings. Werner said the partnership will lead to creating more programs that encourage building owners and managers to address their energy usage. Next on the list, Werner's office is drafting an energy benchmarking ordinance that would require building owners to track their energy use. The city will only qualify for funding and resources from the City Energy Project if it passes the ordinance, which could happen later this winter.
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Pepper the Robot Will Be Helping Out Shoppers at Two Bay Area Shopping Centers This Holiday
TechCrunch (11/22/16) Heater, Brian

Shopping mall operator Westfield has started looking to robots for help in staffing its centers. This past month, the Westfield San Francisco Centre and Westfield Valley Fair in the Silicon Valley began employing Pepper robots to help improve the holiday shopping experience. Developed by Softbank, the humanoid robot has been deployed mostly for show so far. Through November, it has been able to say "Hello!" in six different languages, play a game, and take a selfie with shoppers. The robot also invites interested shoppers to take a short survey, which is a key feature of the overall Pepper pilot. With the poll's results, Westfield will be looking to improve the overall shopping experience. Beginning in December, though, Pepper will start using Westfield's navigation API to help direct shoppers to stores and restaurants on the premises. The Westfield model is part of a bigger seasonal rollout for Softbank that will also find Pepper showing up in smaller pop-up stores in the first quarter of 2017.
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Seven Fire Safety Tips for Senior Residents
Property Management Insider (11/21/16) Blackwell, Tim

According to the U.S. Fire Administration (USFA), adults over the age of 65 face the greatest risk of dying in a structural fire. In 2013, older adults represented 14 percent of the U.S. population but accounted for 36 percent of all fire-related deaths. USFA says older adults are more likely to die under such circumstances due to mobility issues, hearing loss, and medication that affects alertness. Older adults are less able to climb out of windows or jump to safety if an apartment building is on fire, and those with hearing loss may not be able to hear a smoke alarm.

Multifamily housing properties that specialize in senior housing or have a large number of older residents should take advantage of resources provided by USFA and the Electrical Safety Foundation International to educate older residents on fire safety. As smoking is the number one cause of home fire deaths in the country, property management needs to advise residents to smoke outside and never in bed or around medical oxygen tanks. Smoke alarms should be regularly tested, and residents with hearing loss should install alarms that come with a bed shaker or strobe light. Other common-sense safety tips that managers can repeat include the importance of having an escape plan and keeping hearing aids and eyeglasses within reach at night.
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City Struggles to Appease Residents Who Oppose Apartments in Suburbs
Charleston Post and Courier (11/27/16) Darlington, Abigail

Amid one of the biggest apartment building booms in the city's history, Charleston, S.C., is seeing a growing pushback to new construction projects. However, the opponents often find themselves with few weapons to wage their fight. A prime example played out earlier in November when more than a dozen residents packed City Hall's council chambers to object to a new, four-story apartment complex planned near their Byrnes Downs neighborhood. They made the usual arguments of additional traffic congestion and changing the village-like character of their neighborhood. The outcry prompted City Council members to tweak the plans that evening, but they still gave construction a green light.

In this and other similar cases, the response has been the same: "zoning is what it is, and if an apartment project is allowed on a property, the city has few good options to reject it." Charleston is indeed in the midst of an apartment boom, with more than 6,000 rental units planned or already under construction. In many ways, apartment communities are a symbol of dense, urbanized growth that many long-time Charlestonians oppose. Councilman Gary White is among those in authority who are unsure how to calm residents' concerns about new apartments locally. One thing he thinks City Council can do is make sure those who live near new developments get something they want out of the deal.
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Rattlesnakes Like New North Austin State Office Buildings
Austin American-Statesman (11/25/16)

Frequent sightings of rattlesnakes outside a couple of north Austin state office buildings have their occupants rattled. State agencies based in the two buildings have sent memos to employees cautioning them about the venomous reptiles. James Tripp, an Austin herpetologist, says the snakes are likely living in landscaping rocks, shrubs, or other areas around the buildings that border open fields. He further notes that the activity is typical of developing areas where wildlife has been displaced. Additionally, the Austin metro area has seen more rain this year, leading to more reports of snakes encroaching on commercial and residential districts.
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How Apartment Building Owners Can Strike a Balance Between Pet Owners and Non-Animal Lovers
National Real Estate Investor (11/18/16) Herrold, Mary

As more and more apartment communities eliminate restricted pet policies, many property managers are making their properties competitive by offering amenities that improve the quality of life for both residents and their four-footed roommates. However, making sure that the presence of animals does not detract from the quality of life of residents who do not own pets can be a significant challenge for owners and operators managers. To satisfy pet owners, apartment communities can offer amenities such as dog-washing stations and upscale dog parks. These amenities also give pet owners the chance to socialize and develop friendships that may encourage lease renewals.

To ensure that non-pet owners also feel welcome, apartment communities should establish policies regarding pet-related messes and noise. Pet-waste bags and stations with disposal baskets are a must, making it easy for pet owners to clean up after their dogs outside. Pet owners also should not be allowed to let their pets roam the community. Dogs especially running loose might scare non-pet owners, and unleashed canines are at risk of getting hit by a car. If residents complain about barking dogs or other animal noises, managers are urged to provide the owners with contact information for dog training services.
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S.F. Could Require Some Older Apartment Buildings to Get Sprinklers
KQED (CA) (11/21/16) Goldberg, Ted

The most recent Budget and Legislative Analyst's report for San Francisco says that city officials should consider requiring some of the city's older apartment buildings to be equipped with sprinklers. Current law requires such systems to be installed in new and renovated apartment buildings, commercial structures, and hotels, but not in older apartment structures. The lack of sprinklers in these buildings has been highlighted due to a series of fires over the last two years that have left four people dead, displaced hundreds, and caused millions of dollars in damage. Some city officials, building owners, and tenant advocates, however, are worried that such a requirement may be too costly.
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Holiday Shopping by Mobile Phone? Beware Fake Apps and Bad Wi-Fi Hotspots
CIO (11/22/16) Hamblen, Matt

At least two top security firms issued warnings to U.S. shoppers using smartphones to beware of fake commerce apps and fake Wi-Fi hot spots inside shopping malls over the recent four-day Thanksgiving holiday weekend and Cyber Monday. "Cyber criminals are increasing our risk of using mobile devices while shopping," cautioned Brian Duckering, mobility strategist for Skycure. "Going to physical stores and connecting to risky Wi-Fi networks, or shopping online both pose increasing risks we should all be aware of." Security firm RiskIQ similarly said that the smartphone risk was higher this year than in 2015. The company estimated that almost 30 percent of spending on Black Friday and Cyber Monday was to take place on mobile devices. Skycure officials continue to urge users to be aware that hackers have set up fake store apps that look like legitimate ones. Both companies suggest avoiding "free Wi-Fi networks" since 10 percent of malicious networks use the word "free" in their name.

Based on its own security tests of the country's busiest malls, Skycure named 10 U.S. shopping centers where it found at least five risky Wi-Fi networks to avoid. Fashion Show Mall in Las Vegas was judged the most risky for mobile shoppers, with 14 Wi-Fi networks that were found to be malicious or risky to connect to based on the hacker signatures Skycure found on them. Tysons Corner Center in McLean, Va., just west of the nation's capital, was judged second by Skycure for risky Wi-Fi networks. The remaining eight malls singled out in the study were: Yorktown Center in Lombard, Ill.; Town Center at Boca Raton in Boca Raton, Fla ; Sawgrass Mills in Sunrise, Fla.; Mall of America in Bloomington, Minn.; Houston Galleria in Houston, Texas; King of Prussia Mall in King of Prussia, Pa.; Westfield Garden State in Paramus, N.J.; and Memorial City Mall in Houston, Texas.
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DOE Launches 'Better Building Zero Energy Districts'
Buildings (11/21/16)

In an effort to move the building market further along to adopt sustainable practices and help districts achieve zero energy use in buildings, the U.S. Department of Energy (DOE) has teamed up with the National League of Cities to launch the Better Buildings Zero Energy Districts Accelerator. "Zero Energy Districts" are made up of multi-purpose, energy-efficient buildings, where the annual energy delivered to buildings is less than or equal to on-site renewable exported energy. Such districts advance the design and construction of energy-efficient buildings to offset district-wide energy use by aggregating renewable energy sources to power buildings within their boundaries. Kathleen Hogan, DOE's Deputy Assistant Secretary for Energy Efficiency, states, "By committing to zero energy as part of their master planning processes, these communities will create a road map for others to follow."
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