Real Estate Management News - 11/13/2019

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November 13, 2019
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IREM® HEADLINES
Commercial Issues Tackled at NAR Conference
Inspiration as a Tool for Growth in Property Management

INDUSTRY HEADLINES
3 Multipurpose Furniture Trends for Open Office Design
Fairfax County Discusses Plans to Repurpose Unused Parking Spaces at Shopping Malls
Houston, Famed for Sprawl, Bets on Growing Up
Sears Owner Secures $250 Million in New Capital, but Another 96 Stores Will Close
Chicago Ranks as Greenest Place to Work in Country
Jersey City Voters Pass Limits on Airbnb, Short-Term Rentals
How Virtual Reality Is Augmenting Realty
'Sip and Stroll': Arizona Mall Now Allows Visitors to Drink Alcohol There
Bird Study: U.S. Bank Stadium Among Downtown Minneapolis Buildings Involved in High Proportion of Deadly Collisions
Some North Texas Renters Unable To Cut Cable TV: 'We Should Not Be Forced To Pay For Something We Cannot Afford'
Woodfield Mall Eliminates Overnight Black Friday Shopping Hours
'Tis the Season for Surge Robots as Holiday Hiring Finds Automation


 
 

IREM Headlines


Commercial Issues Tackled at NAR Conference

As one of the five commercial affiliates of the National Association of REALTORS® (NAR), IREM was well represented at the annual NAR Conference and Expo last week in San Francisco, with both its 2019 and 2020 presidents, Donald Wilkerson, CPM, of Reno, Nev., and Cheryl Gray, CPM, of Toronto, among its delegation. The conference also saw several issues that have been high priorities for IREM—data privacy, assistance animals and flood insurance—take center stage.

On the subject of data privacy, much attention focused on the state of California where, starting next year, the California Consumer Privacy Act (CCPA) will go into effect. The CCPA gives consumers the right to know what personal information a company intends to or has already collected from them, and also gives them the right to know what personal information companies have shared with others. Companies that are subject to the new law must provide a means for customers to opt out of data collection and demand deletion of their data, while maintaining the right to equal service even if they opt out. All practitioners were urged to be aware of this law, even if they don’t reside in California, as other state legislatures are looking at similar legislation.

Another topic that got attention was assistance animals, and particularly the spurious generation of online documentation for them. IREM, along with other housing industry groups, long has been concerned about how property managers can honor legitimate tenant requests for reasonable accommodation while guarding against false requests aimed at circumventing pet policies. While the industry continues to wait for guidance from HUD on this matter, NAR announced the release of a November 6 letter from HUD to the FTC asking it to investigate websites that are producing possibly fraudulent documentation and use its power to protect consumers from deceptive and unfair business practices.

Flood insurance also garnered attention. A representative of the Federal Emergency Management Agency (FEMA) reported that the current rating system for assessing properties’ flood risk is outdated and may not fully reflect the actual danger level for individual homes and communities. For this reason, FEMA has been developing a new system, Risk Rating 2.0, which would represent the first time flood risk assessments have been updated since the 1970s and would be a move to transform the National Flood Insurance Program (NFIP). Both IREM and NAR have been advocating for a long-term solution to the NFIP.

IREM presented two sessions in the NAR Commercial Learning Theater: Barry Blanton, CPM, of Blanton Turner, AMO, in Seattle, discussed rent control and the unintended consequences it can have on housing and communities, and Ted Thurn, IREM’s government affairs director, provided an update on legalization of medical and recreational marijuana and its impact on multifamily residential and commercial real estate.
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Inspiration as a Tool for Growth in Property Management

Inspiration is much more than a topic for motivational speeches. So says IREM President Cheryl Gray, CPM, in her inaugural column for NREI.

In fact, “Inspire and Be Inspired” will be a guiding theme of her presidency, and in her column she builds on that theme as an important tool for property managers as leaders. “When we’re inspired we feel energized,” she writes, “we’re more confident in our talents and abilities, we’re better able to find creative solutions to challenges, and we find meaning in our work. Maintaining an environment of positivity leads to positive outcomes.”

Inspiration is part and parcel of what Gray calls “an effective and creative workplace,” one that impacts everyone we touch as property managers, be they clients, colleagues, tenants or residents.

Learn more about Cheryl’s thoughts on inspiration at work and how it can help you grow your business.

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Industry Headlines


3 Multipurpose Furniture Trends for Open Office Design
Buildings (11/05/19) Thompson, Adrian

Furniture is not just aesthetic in an open office layout. When an open office interior is executed successfully, employees should have furniture choices that correlate with different tasks and job functions. There are a number of trends to watch for in open office design. The first is using furniture to create private office space within the open layout. According to Bryon Kauffman, vice president of sales and operations for Ethosource, the biggest complaint about open office design is that there is no privacy. Kauffman said that people feel "trapped" when they think they do not have a place to go for a private meeting or conversation. But furniture can be used to create private spaces, designated meeting areas, and singular seating environments, thereby creating areas clearly intended for private or discreet use. This might include using chairs with top and side panels, furniture that can be easily rearranged, desk panels and dividers to block out third-party noise, and wall and ceiling panels.

The second trend is renting furniture to provide some flexibility. Some companies are understandably hesitant about committing to purchasing furniture for their open offices. For those reluctant companies, Peggy Moore, senior vice president of CORT, said renting is the way to go. "Furniture as a service is all about access to what you need, rather than purchasing what you might need and owning it long term," Moore said. Renting allows companies to seek out exactly what they need exactly when they need it, and gives them the flexibility to return the furniture when it is no longer useful. Moore said companies commonly rent adjustable seating and desk options, such as sit-stand desks and furniture with wheels. The third trend is decluttering an open office area with dry-erase boards. Dry-erase surfaces are increasingly common on desktops and walls, allowing those areas to become multi-functional and reducing clutter around the office.
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Fairfax County Discusses Plans to Repurpose Unused Parking Spaces at Shopping Malls
WUSA9 DC (11/10/19) Satterfield, Kolbie

Fairfax County, Va., has put forth a proposed amendment seeking to allow officials to repurpose vacant parking lots at shopping centers. A countywide report said that mall attendance has been declining since the 1990s, adding that just 65 percent of available parking spaces on mall sites were used during peak shopping hours. The report argued that the "oversupply of parking is an inefficient use of land resources and creates environmental, design, and aesthetic issues." Researchers added that repurposing the vacant parking lots would positively impact Fairfax's four major shopping malls: Fair Oaks, Springfield Town Center, Tysons Corner Center, and Tysons Galleria. The county report further argued that malls across the country have "re-purpos[ed] underused surface parking areas for redevelopment activities including the addition of new residential and commercial development, urban plans, and enhanced design for pedestrian activities" to respond to declining mall attendance. Those redevelopments have included pop-up stores and exhibits, community college campuses, and expanded outdoor activities. Tysons Corner and Springfield Town Center have already approved plans for redevelopment that incorporate land currently used for parking.
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Houston, Famed for Sprawl, Bets on Growing Up
Curbed (11/05/19) Sisson, Patrick

Houston was once a suburb-heavy Texas town, sprawling and flat. That has changed in recent years, to the point where people are flocking into the city from the suburbs to become a part of Houston's new identity. The change has been driven by a boom in high-rise, multifamily living in the city. These high-rise apartment and condominium buildings have gone up in various Houston neighborhoods, breathing fresh life into the Heights, Midtown, downtown, the Outer Loop, and the forthcoming McKinley Memorial City, among other areas. Houston is slated to add some 16,000 units this year, and another 23,000 units are waiting in the pipeline. But demand is still so high that a RealPage projection has Houston running out of multifamily housing by early 2020.

Scott Durkin, president of New York-based megafirm Douglas Elliman Real Estate, compared Houston to West Hollywood, Back Bay in Boston, and Miami Beach. "We're all adapting to the buyer, and vertical living is taking such a front seat," Durkin said. As more and more people move back into the city, walkability has become a big point of emphasis for developers. Walkability was once an afterthought in Houston, but now apartments and condos in walkable neighborhoods are able to command the highest rent and for-sale prices. Houston still lags behind similarly-sized cities in terms of walkability and public transit, but it has taken solid steps to catch up. For example, Houston has approved bike plans, relaxed parking minimums, and voted to expand its light rail service. Real estate professionals said the next 12 to 18 months will be crucial for the city, as developers will gauge how residents behave, where competition is fiercest, and what amenities will attract more tenants.
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Sears Owner Secures $250 Million in New Capital, but Another 96 Stores Will Close
CNN (11/07/19) Duffy, Clare

Sears owner Transformco announced late last week it has obtained $250 million in new capital, money intended to help fuel the company's turnaround after it obtained essentially all of Sears Holding Company's assets during its bankruptcy proceedings earlier in the year. Nevertheless, the company also disclosed that it will close another 96 Sears and Kmart stores in 30 states by February 2020, continuing a trend that has been accelerating for months. Following these latest closures, the company will operate just 182 stores compared to nearly 700 when it filed for bankruptcy in October 2018. "We will continue to evaluate our Sears and Kmart footprint, consistent with our overall retail and service strategy," Transformco said in an official statement released yesterday. Going out of business sales are expected to begin at the 96 locations on Dec. 2.
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Chicago Ranks as Greenest Place to Work in Country
ABC 7 Chicago (11/02/19)

For the third consecutive year, Chicago has been ranked the nation's leader in energy-efficient office buildings. The title was bestowed by CBRE Group Inc., Maastricht University, and the University of Guelph. The three bodies worked together to publish the 2019 National Green Building Adoption Index. That index saw Chicago outrank San Francisco, Atlanta, Minneapolis-St. Paul, and Los Angeles in the list of green cities. Researchers formed the ranking by analyzing green-certified office space across the nation's 30 largest office markets. Green office buildings are certified so by earning an EPA ENERGY STAR label, USGBC LEED certification, or both.

This year, the researchers found the largest percentage of green office space in the index's history, a 42.2 percent share. Spencer Levy, chairman of Americas Research for CBRE and senior economic adviser, praised Chicago's efforts in embracing green office space. "Chicago is a wonderful example of how cities can implement green building practices in both new construction and retrofits," Levy commented. "These efforts not only benefit the city and the environment, but also deliver real costs savings to owners and investors." Within the Chicago market, 71.1 percent of office space is now green.
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Jersey City Voters Pass Limits on Airbnb, Short-Term Rentals
Associated Press (11/06/19)

Airbnb last week was dealt a setback when voters in Jersey City, N.J., approved restrictions on short-term rental companies in a hard-fought referendum. The vote was lopsided in favor of the restrictions, despite Airbnb spending more than $4 million on an effort to sway voters. Its opponents, including the hotel industry, spent around $1 million. The new rules were initially passed by Jersey City legislators earlier this summer, but were delayed after short-term rental advocates gathered enough signatures to force a referendum. Jersey City, located just across the Hudson River from Manhattan, has become increasingly popular with tourists seeking an alternative to pricey New York City accommodations. Since officials approved short-term rentals there earlier in the decade, the number of homes being listed nightly on such sites as Airbnb has mushroomed tenfold. This, in turn, has led to complaints about absentee owners turning apartment buildings into de facto hotels.
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How Virtual Reality Is Augmenting Realty
New York Times (11/08/19) Chen, Stefanos

Virtual reality (VR) and augmented reality (AR) technology is making inroads in the realty industry. One example is an AR app from the architecture firm SHoP for visualizing a future high-rise in Brooklyn, which works with iPads that function like a viewfinder to display an overlay rendering of the apartment tower. Meanwhile, Matterport has developed spatial-capture software that should make 3D VR real estate tours accessible to much wider audiences. The company developed a composite camera that captures and stitches images into virtual reproductions of a space for viewing on multiple devices, and the software now interoperates with more affordable, commercially-sold cameras. Another company, roOomy, can shoot photos or 3D composites and fill the virtual space with realistic furniture and staging. The firm has teamed with Sotheby's International Realty and Toll Brothers to virtually furnish real and in-development apartments to entice prospective buyers.
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'Sip and Stroll': Arizona Mall Now Allows Visitors to Drink Alcohol There
Greenwich Time (CT) (11/02/19)

Desert Ridge Marketplace in Phoenix is set to become the first shopping center in the country to allow people to consume alcohol on the premises. Though Arizona generally prohibits people from drinking alcohol in public, a new law was passed in April allowing for the consumption of alcoholic drinks in pedestrian areas of shopping malls. Desert Ridge Marketplace is the first mall to take advantage of the new law. Nine other malls are permitted to follow suit in the three-year pilot program before the law is expanded to every mall in the state.

Desert Ridge Marketplace introduced its "sip and stroll" program earlier this month. Visitors to the shopping center have to buy the alcohol from an outdoor kiosk. Emily Andrews, a mall shopper, said she was excited for the opportunity to have a drink while shopping. "As a mom, you just need a glass of wine sometimes. And now I can do it and enjoy shopping and all the other stuff Desert Ridge has to offer," Andrews remarked.
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Bird Study: U.S. Bank Stadium Among Downtown Minneapolis Buildings Involved in High Proportion of Deadly Collisions
Star Tribune (Minn.) (11/07/19) Olson, Rochelle

A new bird mortality study found that U.S. Bank Stadium and three high-rise office buildings are responsible for a high proportion of bird fatalities in Minneapolis. The study found that the stadium and the three unidentified high-rises account for 74 percent of bird collisions and 68 percent of bird fatalities. The Minnesota Vikings, the football team that plays in the stadium, commissioned the study along with the Minnesota Sports Facilities Authority (MSFA) in response to conservationists' concerns that birds following the Mississippi River corridor would collide with the stadium's high walls. According to the study, there are three major problems contributing to the high bird mortality rates at the stadium and the three buildings: The way the buildings are lit up at night, the expanses of reflective glass, and vegetation near the glass that tricks birds into believing they are approaching trees, not a solid wall.

The Vikings and MSFA issued a joint statement saying they’re "committed to further evaluating" recommendations to mitigate bird deaths, but did not commit to marking or disfiguring the glass in a bid to discourage birds from approaching. They did commit to using the National Audubon Society's guidelines on lighting, especially during the migratory season. The study included Minneapolis buildings so that it would be useful for the city as a whole and not confined to U.S. Bank Stadium. The $1.1 billion stadium was built with almost $500 million in public money, and publicly subsidized buildings now are required to make environmental accommodations for birds.
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Some North Texas Renters Unable To Cut Cable TV: 'We Should Not Be Forced To Pay For Something We Cannot Afford'
CBS Dallas/Fort Worth (11/07/19) Autler, Alanna

Apartment communities in North Texas have spurred controversy by incorporating bulk billing practices. In a bulk billing system, multi-dwelling buildings automatically provide cable and Internet to all units, and therefore automatically charge all units for technology packages. But some renters who do not want or use the cable offerings have insisted that they should not be forced to pay for services they did not want or, in some cases, cannot afford. Susan Chandler, a renter at Lake Village North Apartment Homes in Garland, Texas, said she started incurring charges of $89 per month after her building put in cable, even though she did not ask for it and could not afford the extra charges. According to Chandler, when she brought it up with the apartment owner, the landlord simply suggested she look for another place to live.

Bulk billing practices are becoming increasingly common across Texas. Twelve of the 14 properties operated by Camden in the Dallas-Fort Worth area use bulk billing, as well as eight of the 10 Cottonwood Residential properties in the area. Sandy Rollins, the executive director of the Texas Tenants' Union, criticized the property management companies' embrace of bulk billing, deriding is as mandatory amenities that may not be wanted or used by all residents. But some of the firms have defended themselves, arguing that a vast majority of their tenants want cable. In a statement, Camden noted its technology package costs 30 to 50 percent less than retail packages. Linda Willey, Camden's director of ancillary service, said that "a recent survey at one of our Dallas communities indicated a significant percentage of residents preferred to keep cable and several stated that losing cable would make them reconsider living at our community." Meanwhile, the National Apartment Association has said bulk billing offers savings to residents and provides a way for managers to attract occupants in a tight market.
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Woodfield Mall Eliminates Overnight Black Friday Shopping Hours
NBC Chicago (11/04/2019)

Extended Black Friday shopping hours have long been a controversial subject for shopping malls nationwide. The Woodfield Mall in suburban Schaumburg, Ill., is taking a stand against overnight sales on Thanksgiving this year. Woodfield Mall has announced that it will be open from 5 p.m. to midnight on Thanksgiving Day, but it will close at midnight and remain closed until 6 a.m. the next day, Black Friday. At that point, the mall will reopen and stay open until 9 p.m.

The restricted shopping hours stand in contrast to how Woodfield Mall has operated during recent past Black Fridays, when the mall remained open for as many as 29 consecutive hours. The operators of Gurnee Mills, another Chicago-area mall, have also decided to offer restricted Black Friday hours. Gurnee Mills will be open 7 p.m. to midnight, then closed until 6 a.m., at which it time it will re-open for Black Friday. Both Woodfield Mall and Gurnee Mills are owned by Simon Property Group. It should be noted that not every Simon mall in the metro area is adopting the new Black Friday hours. Chicago Premium Outlets in Aurora, for example, will remain open throughout the night.
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'Tis the Season for Surge Robots as Holiday Hiring Finds Automation
The Wall Street Journal (10/28/19) Smith, Jennifer

Retailers and logistics operators are investing in collaborative robots (cobots), to accelerate warehouse operations in the holiday season. Locus Robotics CEO Rick Faulk cites increasing demand this year for "surge robots," to supplement the seasonal workforce and assist in filling online orders and restocking inventory at brick-and-mortar stores. Companies are using robots to help with storing, sorting, and packing goods for shipment. Automation companies say the bulk of seasonal demand for their robots comes from clients that already use their machines, which means new operations can be set up in minutes or hours. Some companies envision robots taking over for an aging labor pool, while others envision machines filling in when there is a shortage of available workers.
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News summaries © copyright 2019 SmithBucklin



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