Real Estate Management News - 09/06/2017

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September 6, 2017
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LEADERSHIP SPOTLIGHT
New IREM CEO/EVP – Denise LeDuc-Froemming

IREM® HEADLINES
Hurricane Harvey and How You Can Help
IREM Kicks Off Ethics Awareness Month
Last Chance to Save on IREM’s Global Summit

INDUSTRY HEADLINES
Office Spaces Focusing More on Communal Areas
Uber Announces Tie-Up With Westfield's US Shopping Malls That Will Feature Taxi Waiting Lounges
6 Ways to Prepare for and Recover from Natural Disasters
4 Tips for Dealing With Fall Pests
The Challenge With Smart-Home Technology in Multifamily
Security Robot Intrigues River Oaks District Shoppers
Top 10 Factors in Apartment Renters’ Decision to Lease
Mall Owner Simon Sues Starbucks Over Teavana Chain's Shutdown
Insurers Are Set to Use Drones to Assess Harvey's Property Damage
The Future Is Now: Five Smart Building Features Transforming Today's Workplace
What Your Occupants Really Want in a Bathroom
CBRE Report: Aging Population Boosting Demand for Medical Office Buildings


 

Leadership Spotlight


New IREM CEO/EVP – Denise LeDuc-Froemming

Denise LeDuc-Froemming, CAE, MBA, CPA, joins IREM as CEO/EVP on September 11, 2017. In its 85 year history, Denise will be the sixth staff executive to lead IREM.

Denise brings over 20 years of association experience, serving most recently as COO and CFO/EVP at the American Health Information Management Association (AHIMA). Between her work at AHIMA and at the College of American Pathologists (CAP), Denise has been responsible for building, leading, and advising the organizations through complex restructuring, market expansions and organizational transformations. Denise’s career in association leadership has centered on applying her skills in association change and thus leading organizations into a newly defined future.

Denise holds the Certified Association Executive (CAE) designation conferred by the American Society of Association Executives, and the Certified Public Accountant (CPA) conferred by the American Institute of Certified Public Accountants. She received a Bachelors of Science degree in business from Marquette University, as well an MBA from Northern Illinois University.

Denise is the type of person who takes a lesson with her from every job she’s held – and one of her favorites is this, “Excellence, passion, intense effort, communications, and teamwork are not individually exclusive. Success as a professional or as an organization demands commitment to each.”

According to Denise, “It is an honor to serve as the CEO/EVP of IREM. This is an exciting time for IREM as it continues to work toward meeting and exceeding its strategic objectives and delivering exceptional value to members and the industry. I look forward to working closely with leadership, members and staff to create a highly successful future.”
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IREM Headlines


Hurricane Harvey and How You Can Help

Hurricane Harvey has caused record-breaking flooding and catastrophic damage in Texas, Louisiana, and surrounding areas. As property managers, events like this remind us of the importance of making sure you and your properties are prepared for potential natural disasters. For some resources on this topic, download the Floods, Droughts, and Landslides chapter (PDF) of the IREM publication Before and After Disaster Strikes, and view the IREM checklist What to Do After a Flood.

Additionally, you may help Hurricane Harvey victims now by donating to any number of charitable organizations that are assisting the rescue and cleanup efforts. If you are able to help, please consider the following organizations:

American Red Cross

Central Food Bank of Texas

Texas Diaper Bank

Heart to Heart International

Hurricane Harvey Relief Fund

Flood Relief for Texas Children’s Hospital

Coalition for the Homeless of Houston

Houston Community Toolbank

REALTORS® Relief Foundation

Also, FEMA will be making housing vouchers available to those who are displaced. Anyone affected should contact John Carleton (202-870-4486) or Blair McDonald (972-795-5795), who are leading the housing assistance planning effort at FEMA. The Rural Development Disaster Assistance program also provides aid to rural communities.
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IREM Kicks Off Ethics Awareness Month

Professional ethics is a cornerstone of what it means to be a member of the Institute of Real Estate Management (IREM) – and to honor that, September is officially IREM Ethics Awareness Month.

All members of IREM are obliged to uphold the IREM Code of Professional Ethics, conducting their professional activities in accordance with the Code. In addition, AMO Firms must uphold the AMO Code of Professional Ethics. These two Codes protect the public, promote competition, reflect contemporary business practices, and send a powerful message to the marketplace that IREM Members act ethically. IREM is one of the very few organizations that actively enforce its Code – violations are processed within a defined structure, including an established peer review process that may result in disciplinary actions.

“Member adherence to the IREM Code of Professional Ethics is what has set us apart from the rest of the industry since 1933,” states Michael Lanning, CPM, 2017 IREM President, Senior Vice President & Market Leader, Cushman & Wakefield, Kansas City, MO, “Our owners, employers and clients should know that IREM Members are bound by this strictly enforced code, giving members credibility and trust that our competition just doesn’t have.”

During Ethics Awareness Month, IREM and our network of 92 chapters across the US, and the globe, will highlight the commitment to ethics and integrity with the launch of the newly updated Ethics for the Real Estate Manager –ETH800 course, a live webinar entitled “What’s Your Ethical Health? An Annual Check-Up on Code Compliance”, and a social media campaign that allows members to show what IREM Ethics mean to them using #IREMethics on Twitter and Instagram.
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Last Chance to Save on IREM’s Global Summit

September 8 is the last day to save $100 on registering for the IREM Global Summit, scheduled for October 10-13. You can also save $50 on the Professional Education Pass if you don’t need to attend the full conference.

The Global Summit is set to deliver a one of kind, contemporary conference experience for commercial and multifamily property and asset managers. In addition to over 25 education sessions and events, don’t miss out on the much anticipated keynote sessions with John Foley and the Industry Leaders Lunch featuring volunteer leaders from BOMA, NAA, and CCIM on stage with the 2017 IREM President Mike Lanning, CPM.

Check out the full schedule of education sessions and events.

Register for the Global Summit Today!
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Industry Headlines


Office Spaces Focusing More on Communal Areas
Wall Street Journal (08/27/17) Morris, Keiko

More and more businesses are designing offices spaces that are increasing the amount of square footage per employee when shared work settings are taken into account. That is one of the conclusions of a new report by Ted Moudis Associates, an architecture and design firm which analyzed 2.4 million square feet of its office projects. Many companies are expanding their array of alternative places to get work done, such as cafes, kitchen areas, and quiet zones. "Five to 10 years ago, it was all about how many people can I get in this space," observes Jamie Feuerborn, associate director of workplace at Ted Moudis. "Now some of that efficiency is a given, and everyone from the top level executive down is focused on the employee experience."

To be sure, the amount of space at average assigned workstations has not increased. But the study notes that the average "seat" has increased from 142 square feet in 2016 to 165 square feet currently. Seats range from workstations to conference rooms to living room-style seating areas. Seating in these shared work settings has actually surpassed the number of traditional, assigned workstations. In the offices analyzed, 52 percent of the seats were devoted to such alternative work settings. Office space designers are seeing this shift across a broad array of industries, too. On average, office workers sit at their desks 60 percent to 65 percent of the time. Consequently, employers can still find savings with shared spaces that are used much more frequently, report workplace consultants and designers. In turn, many firms invest these savings in the technology required to create a more mobile office worker as well as amenities like free meals and barista service.
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Uber Announces Tie-Up With Westfield's US Shopping Malls That Will Feature Taxi Waiting Lounges
CNBC News (08/31/17) Reid, David

Uber Technologies has inked a deal to have designated drop-off and pick-up areas at all of Westfield's 33 shopping centers throughout the United States. The two firms this past week announced a partnership that places the locations on the Uber app, meaning Westfield's shoppers can see where exactly they can be picked up and dropped off. Each of the Westfield shopping centers will incorporate between one and 10 Uber pick-up and drop-off stations. Some malls will also include kiosks with Uber customer service employees. "Uber wants to make transportation seamless for everyone, everywhere, but we can't do it alone," Amy Friedlander Hoffman, Uber's head of business development and experiential marketing, remarks. "So we're excited to work together on this first-of-its kind initiative aimed at delivering the best possible experience to our riders when they're going shopping, dining, or catching a movie."
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6 Ways to Prepare for and Recover from Natural Disasters
Property Management Insider (08/29/17) Chimal, Ashley; Mendes, Leah

Hurricane Harvey and its remnants slammed the South Texas and Louisiana coast this past week, flooding towns and cities with trillions of gallons of water and causing damage to apartment communities, commercial buildings, homes, and more. As th region and the country prepare for the recovery process, many will be tasked with making property decisions. The article's author rounded several past Property Management Insider articles for apartment residents, multifamily housing investors, and apartment community owners as they recover from the storm.

One past feature, titled "Managing Storm Water in Multifamily," offered a new way of thinking about stormwater drainage and multifamily landscape design. A second piece, titled "Disaster Recovery Guide for Multifamily Communities," provided several steps owners and operators can take to help their complexes before, during, and after disaster strikes. "Top 5 Apartment Roofing Tips to Protect Your Properties" is self-explanatory, as is "Six Tips to Financially Prepare for a Hurricane." A fifth article, titled, "Prepare Your Properties for Hurricane Season" provided even more straight-forward, actionable steps building owners and managers can take to prepare for future hurricanes.
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4 Tips for Dealing With Fall Pests
Buildings (08/31/17)

September is here, and that means fall is just around the corner. That also means it is a good time now for building managers to evaluate their pest management strategies. As more and more little critters find the outdoors too cold for their comfort, many will almost certainly try to find a warmer spot inside buildings. The five most common types of pests that impact businesses are rodents, cockroaches, flies, ants, and stored product pests like moths and weevils. Terminix Commercial offers four strategies to deal with such creatures.

One, be sure to control the point of access. It is absolutely crucial to inspect physical entry points to the facility, as stopping pests at the point of entry is the simplest way to avoid a pest mess. Two, managers should know where and what to inspect. After all, pests can appear without a sound, so routine inspections for signs of an infestation are a must. Three, implement sanitation procedures early and often. Finally, make it a team effort. The article's author concludes, "Proactively identifying and resolving pest challenges is a tough task, and requires partnership among janitorial, facilities, and pest management staff."
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The Challenge With Smart-Home Technology in Multifamily
Multifamily Executive (09/01/17) Hughes, Kellie

Apartment home automation can be a great feature, but it can also present some headaches for owners and operators. The article's author details several tips for how to keep residents happy and property managers sane in this regard. The main objective with smart-home technology is to empower residents to utilize it to its full potential to create a convenient and seamless living experience. The latest innovations range from smart-key access to Bluetooth-enabled control features. Most say smart-home technology delivers a "wow" factor, especially during the leasing tour experience, that can differentiate one community from its competitors. However, significant challenges do exist that routinely hold apartment operators back. Among the biggest obstacles are a lack of centralized control systems, too many brands and technologies to choose from, and steep learning curves for on-site staffers.

Beyond the common challenges of smart-home technology are other, unanticipated obstacles apartment owners and operators may not realize exist until they begin testing and implementing the products in their buildings. For instance, many smart thermostats require training to use correctly. Without proper setup and usage, residents might experience higher initial utility bills, leading to much frustration. In addition, the devices require maintenance employees to take extra time in each apartment to change the settings at move-out. Centralization may be the answer. The ability to monitor the lights, thermostats, and doors of vacant apartments from a main hub could save both utility expenses and maintenance time. In addition, it could provide a range of customer service capabilities.
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Security Robot Intrigues River Oaks District Shoppers
Houston Chronicle (08/21/17) Blunt, Katherine

In Houston, the swanky, retail-heavy River Oaks District is patrolled by an egg-shaped security robot The robot, dubbed ROD2, recently became the latest addition to a patrol team eager to experiment with fast-evolving technology that has captured the attention of robotics developers. Its eye-like cameras continuously compile information on its surroundings and monitor for unusual activity, providing extra surveillance in an area where expensive cars and high-end stores might tempt criminals. Designed by Silicon Valley-based Knightscope, the robot is one of nearly 40 now on patrol at shopping centers, parking lots, and business properties nationwide. The company expects that total will reach 100 by the end of the year. "We're seeing the potential for robotics to become an enabling technology for every industry," Andra Keay, managing director of the nonprofit group Silicon Valley Robotics, remarks. "That means moving into business, into retail, into a whole range of other areas."

The five-foot-tall autonomous robot looks somewhat like an armless R2-D2 from "Star Wars." Left alone, the robot will rove a designated area with a complex set of sensors that enable it to detect obstacles and monitor its energy levels. It works around the clock, stopping only to charge every couple of hours. It's can read license plates, recognize familiar faces, and detect what could be suspicious activity. In addition, it can sense extreme heat. In the various venues, Knightscope ROD2 robots have recorded information that has helped law enforcement issue an arrest warrant for a sexual predator, apprehend a robber, and track down a vandal. Other companies, most notably Cobalt Robotics, have rolled out similar security robots.
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Top 10 Factors in Apartment Renters’ Decision to Lease
National Real Estate Investor (09/01/17) Misonzhnik, Elaine

A new poll that was recently conducted by national apartment management firm Village Green found that three factors -- monthly rent, location, and community environment -- comprise the top three drivers of apartment leasing decisions among renters of every age and across different geographic markets. Approximately 70 percent of survey respondents said they research apartment properties online, either before or after making an on-site visit. Sixty-five percent do so via the apartment listing website, while 60 percent look at the website of the apartment community itself. Another 26 percent said they visit independent online review sites such as Yelp, while 17 percent look at social media platforms to get the low-down on apartment community prior to making their leasing decision.

When it comes to researching apartments through apartment building/community websites, respondents place the highest importance on clear and thorough explanation of amenities (68 percent) and quality photos (60 percent). The survey included 1,000 respondents, all of whom are currently apartment renters. In terms of age demographics, 32 percent were millennials, 28 percent were of Generation X, 33 percent were Baby Boomers, and 7 percent belonged in other age groups. Finally, 61 percent identified themselves as either single, separated, divorced, or widowed.
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Mall Owner Simon Sues Starbucks Over Teavana Chain's Shutdown
Seattle Times (08/30/17) Tu, Janet I.

Simon Property Group is suing Starbucks over the closing of its Teavana retail stores. Starbucks announced back in July that it will close all 379 of its Teavana stores, many of which are located in shopping malls throughout the United States and Canada. More than 70 of those stores are located in malls owned by Indianapolis-based Simon, which has filed a lawsuit seeking to halt the coffee giant from permanently shuttering the stores. The suit was filed in Marion Superior Court in Indianapolis. In it, Simon said only two of the Teavana leases at its malls expire before next spring. In addition, Simon argues that Starbucks' decision to close its Teavana chain was not because the stores have been losing money. Rather, the mall operator argues, the company is closing the stores because they aren't doing well enough to satisfy Starbucks.
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Insurers Are Set to Use Drones to Assess Harvey's Property Damage
Wall Street Journal (08/31/17) P. B2 Friedman, Nicole; Scism, Leslie

Insurers have been testing the use of drones for inspections since winning approval in 2015 from the Federal Aviation Administration (FAA). These devices can provide aerial images that help insurance adjusters inspect buildings faster and more safely, which can lead to a faster claims process. Hurricane Harvey is likely to be the first real large-scale test of drones, as Travelers Cos. has about 24 drones ready for use in Texas and 200 employees certified as FAA drone pilots. Other insurers have drones ready for inspections, and adjusters are hopeful that they can use the aerial photos to make accurate damage estimates.

However, the FAA has temporarily restricted flights of all types, with exceptions, over most of Houston as of Thursday, meaning operators have to get federal approvals to fly. Chubb Ltd.'s Fran O'Brien says that the insurer will likely use drones for commercial property or to reach areas that are inaccessible, like barrier islands. "If technology is the way to give good service, we will do that. If it can be done through human adjusters with lots and lots of experience with these kinds of claims, we will [go that route]," she says.
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The Future Is Now: Five Smart Building Features Transforming Today's Workplace
Forbes (08/31/17) Barendrecht, Arie

The article's author details five examples of Web-enabled smart building features that are having a big impact on today's office environments. The first is optimized HVAC systems. For example, through the use of such systems that continuously "maximize performance of the whole system," The Rockefeller Group was able to achieved major carbon dioxide reductions -- almost 3,000 tons a year -- at its landmark Time-Life Building in midtown Manhattan. The second is managed electricity reductions. Aiming to keep electricity consumption within sustainable levels on the hottest summer days, more and more of the nation's utilities now offer so-called "demand response" incentives designed to help ensure system reliability. The thid is maximized building security. The author cites one major managed security firm that offers a visitor management service, which enables businesses to use visitor registration directly from their e-mail client. This has proven to significantly expedite visitors' check-in process by having the user-friendly barcodes e-mailed directly to them.

Four, more buildings are installing smart sensors for lighting. At the New York Times' 52-story, 1.5 million-square-foot headquarters in Manhattan, for instance, the publisher implemented a management system that aligned lighting controls, motorized window shades, sensors, digital ballasts, and LED drivers all under a single software umbrella underpinned by a Internet-based interface. The system has slashed usage to approximately 0.4 watts per square foot -- a 70 percent energy savings. Finally, there are controlled appliances from remote locations. For any work space with a large kitchen, network-based freezer and refrigeration sensor systems can reduce costs and possibly prevent major losses associated with spoiled or unusable product.
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What Your Occupants Really Want in a Bathroom
Buildings (08/31/17)

Building operators can update to the latest hand dryer. They can install automatic toilets that save gallons of water. But what occupants truly want may be something management hasn't thought of. Bradley Corp recently conducted a poll dubbed the 2017 Healthy Hand Washing Survey. In it, more than 1,000 American adults were queried on public restrooms, germs, colds, and the flu. The reserach found that, one, people just want bathrooms that are clean and orderly. Jammed or empty toilet paper dispensers ranked as the top aggravator, with clogged or unflushed toilets placing a close second.

The study also found that occupants will wash hands if provided with soap. Nearly unanimous, 97 percent of respondents said they believe it's important to wash hands after using a public restroom. The study further determined that your entire building will often be judged solely on restroom experience. Nearly all respondents -- 92 percent -- see a direct association between the quality of a company's products and services and the quality of the restrooms at the buildings it occupies.
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CBRE Report: Aging Population Boosting Demand for Medical Office Buildings
Utah Business Magazine (08/17)

The aging U.S. population, combined with such factors as pressure for healthcare providers to cut costs and new technologies, have boosted demand for medical office space in recent years. According to a recently released CBRE report, the overall U.S. medical office building vacancy rate was 8 percent in this year's first quarter -- down by almost 300 basis points from the first three months of 2010 and well under the vacancy rate for the U.S. office market overall (13 percent as of March 31). "The steep increase in the 65+ population and anticipated greater need for in-office physician services by this group signals a continued increase in demand for healthcare services and medical office space in the years ahead," observes Andrea Cross, Americas head of office research, CBRE.

Investment in the U.S. medical office sector rose significantly over the last seven years. Total U.S. investment volume in medical office space of at least 10,000 square feet increased from just under $4 billion in 2010 to $10.2 billion as of the end of last year. Overall asking rents for medical office properties have remained fairly flat for the last seven years, ranging between $22 to $23 per sq. ft. a year. This trend reflects the relative stability of the medical office tenant base.
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