Posted on November 2, 2018
The NAIOP CRE Sentiment Index for September 2018 (a composite of nine survey questions), showed positive changes in seven of the nine questions that underpin the Index. This survey's 0.66 Sentiment Index reading is the highest posted since the full survey commenced in March 2016.
Key takeaways:
Posted on October 30, 2018
By Joe Padilla
Charlotte has an Affordable Housing crisis -- it's an undeniable fact. Our crisis is not unlike those faced by dozens of American cities, large and small, where a limited supply of land and rooftops pushes rents and home prices out of reach for many. It's a unfortunate byproduct of our own success, driven by the growing appeal of a city that continues to attract more than 40 new residents a day with our high quality of life, temperate weather and strong job market.
What is also undeniable is that the need for affordable housing exists across much of the income spectrum. The U.S. Department of Housing & Urban Development (HUD) pegs the Charlotte MSA's Area Median Income (AMI) right around $74,000. Using the rule of thumb that no one should spend no more than 30% of their gross income on housing, a family of four earning 80% of AMI ($56,550 a year) could pay a maximum of about $1,400 a month in order to avoid being what the government considers 'cost burdened.' On the lower end of the income spectrum, a family of four at 30% AMI ($35,350) shouldn't exceed about $883 in monthly housing costs.
Posted October 26, 2018
Green roofs have been slowly catching on in the U.S., but more municipalities are encouraging or requiring their installation to reduce energy costs and absorb stormwater. According to an article from Governing.com, two companies are helping to guide green roof installation. Counterpointe Sustainable Real Estate and Green Roofs for Healthy Cities advise companies and municipalities on the best way to adopt green roofs. Additionally, The Living Architecture Performance Tool is a “rating system and best practice guide” to achieve “measurable and replicable performance benefits” when building green roofs.
San Francisco’s Better Roofs Ordinance and Denver’s recently adopted Green Roof Initiative require newly built buildings to dedicate a portion of their rooftops to vegetation or solar panels. Approximately 25 cities in North America have programs to encourage green roofs.
Posted October 25, 2018
Potential investors are getting some clarity about how they may use Opportunity Zones to reduce their capital gains taxes. Last week, the Department of the Treasury released proposed rules for the zones, which were created as part of last year’s tax reform bill. Earlier this year, Treasury had approved opportunity zones – communities that have been identified as economically disadvantaged – in all 50 states, the District of Columbia and five U.S. territories.
“We want all Americans to experience the dynamic opportunities being generated by President Trump’s economic policies. We anticipate that $100 billion in private capital will be dedicated towards creating jobs and economic development in Opportunity Zones,” Treasury Secretary Steven Mnuchin said.
NAIOP supported the inclusion of the Opportunity Zones provisions in last year’s Tax Cuts and Jobs Act. Opportunity Zones allow investors to “defer tax on any prior gains until the earlier of the date on which an investment is sold or exchanged, or December 31, 2026, so long as the gain is reinvested in a Qualified Opportunity Fund,” the IRS explained. “[I]f the investor holds the investment in the Opportunity Fund for at least ten years, the investor would be eligible for an increase in basis equal to the fair market value of the investment on the date that the investment is sold or exchanged.”
Posted on October 23, 2018
We are proud to introduce our new association members! The following is a list of individuals who have joined NAIOP Charlotte since June 11, 2018:
The Town of Huntersville is considering establishing its own local development review and permitting agency, bringing in-house a variety of services now provided by Mecklenburg County.
The main services the Town would take over from LUESA include development plan review; zoning, development and erosion control inspections; and bond administration. The Town Manager told the Board this week that five new positions would need to be created to provide these services.
Board members expressed their hope that bringing land development services in house would improve efficiency and reduce plan approval time for developers. REBIC is meeting with staff and Commissioners over the coming weeks to explore the proposal and ensure a handover doesn’t negatively impact development services.
The Board of Commissioners hopes to vote on the proposal in November and begin implementation by July 2019.
Posted on October 16, 2018
REBIC has put together an Election Guide to help you cast your vote for candidates who support the real estate industry.
Posted on October 16, 2018
A recent New York Times article, The Most Important Least-Noticed Economic Event of the Decade, describes how in 2015 and 2016 a confluence of interconnected forces had a significant impact on the world economy and the presidential election but not many were aware that it ever happened. This slowdown went mostly unnoticed as it primarily affected the energy and agricultural sectors and their equipment suppliers, but it has some important political and economic implications.
It began in 2015 when the Chinese government, believing their economy was about to experience a credit bubble, imposed policies to restrain growth. This action caused a slowdown in the Chinese economy as well as in developing nations that relied on Chinese investment. Simultaneously, the Federal Reserve was ending its “era of ultra-easy monetary policy” while banks in Europe and Asia were lowering their rates. The value of the U.S. dollar increased, causing Chinese companies to become less competitive globally. When the Fed raised interest rates in December of 2015, it made financial conditions “tighter and therefore slow[ed] growth across big swaths of the world.”
This slowdown caused less demand for oil and other commodities such as metals and agricultural products. Emerging economies felt this pinch and falling prices and high debt loads among energy producers in the U.S. generated losses for investors and stoked fears about the overall stability of the global financial system. The Fed intervened in 2016 by deciding not to raise interest rates and reducing their expectations of how much they would raise rates over the remainder of the year. As a result, the dollar weakened, oil prices began a recovery and spending was growing again by summer 2016.
Posted on October 15, 2018
By Jennifer Lefurgy, Ph.D.
The use of technology in office building operations has come a long way from motion-controlled light sensors and key card entry systems. Building owners and operators are beginning to use an array of increasingly sophisticated software and hardware to gather more information about how their buildings can not only can work more efficiently, but give them insights into how to attract and retain tenants. The NAIOP Research Foundation’s new report, The Office Property and Big Data Puzzle: Putting The Pieces Together, by Kimberly Winson-Geideman, Ph.D., discusses what defines big data, how it is being used by building owners, and some of the issues those who are working with big data should consider.
Big data is defined as high-volume, high-variety and high-velocity information that is produced in either structured formats (e.g., sensor data) or unstructured formats (e.g., pictures, text). The sheer influx of big data can be overwhelming for many companies; they often choose to sit on the data they collect with no concrete plans to use it. Therefore, some firms, particularly those without the resources to sift through large amounts of data, risk missing valuable information that could improve their bottom line and position them favorably in an increasingly competitive market.
Posted on October 12, 2018
Lawmakers in both parties are beginning to understand the real-world consequences of a drafting error in the 2017 Tax Cuts and Jobs Act and are asking for a fix. Last week, a group of 12 Senate Democrats sent a letter to Treasury Secretary Steven Mnuchin urging action on the tax treatment of Qualified Improvement Property (QIP). A similar letter from 58 House Republicans was also delivered to Speaker Paul Ryan.
QIP is broadly defined as improvements to an interior portion of a commercial building. These include tenant improvements or an office build-out.
Kevin Brady, Chairman of the Ways and Means Committee, has promised to introduce and advance a technical corrections bill in the lame duck session of Congress, following the November midterm elections. But with Republicans’ majority in the House in jeopardy, it remains unclear whether Democrats will be willing to help move the bill before the end of the year.
Posted on October 9, 2018
Recruiting and retaining top talent has become essential in today's highly competitive marketplace.
Is your 2019 salary and bonus package competitive? Find out with the 2018 NAIOP/CEL Commercial Real Estate Compensation and Benefits Reports.
These valuable reports enable commercial real estate businesses to stay current on salaries, bonuses and benefits for CRE professionals from executive to entry level positions. The reports include submissions from 400 companies; salary, bonus, incentives and benefits for 200 positions; and data from 100,000 distinct jobs in the office/industrial, retail and residential property sectors.
Posted on October 9, 2018
Thank you to everyone who came out on Monday, October 1, for the NAIOP Charlotte & CRCBR Annual Golf Tournament at Carolina Golf Club.
Posted on September 14, 2018
Earlier this week, the Board of Directors for the Charlotte Regional Partnership and the Executive Committee of the Charlotte Chamber voted unanimously to authorize their CEOs and staff to engage in the steps necessary to formally combine the organizations. The Boards of both organizations are expected later this year to act on a formal recommendation from their respective Executive Committees to finalize the combination. It is anticipated that should the Boards vote to ratify the recommendation, the new enterprise will begin operations on January 1, 2019. We are providing the media this afternoon with a limited joint statement, but we believe it is important for you to hear this news from us first.
The decision to combine the two organizations is rooted in a belief that the vision and mission of the two organizations naturally align with one another and combining the two will sustain and enhance the economic growth, prosperity and global competitiveness of the Charlotte region. As part of an integration effort, the mission statements of each organization will be reviewed with an intent to build on their respective foundations to determine the mission and vision of the new organization.
The intent of the combined enterprise will be to build on the experience and passion of both organizations to galvanize the 16-county Charlotte region through a shared vision and coordinated efforts. The business leaders in our community are committed to building the best enterprise in the country in order to drive long-term growth and a vibrant economy. A unified enterprise provides a clear path and single development team for site selectors and business leaders and owners who are considering a corporate re-location or business expansion.
REBIC’s annual BBQ & Candidate Meet & Greet is fast approaching on September 27, 2018! Make sure to get your tickets early! This annual bi-partisan Political Pig Pickin’ brings state and local candidates together with hundreds of members of the Charlotte real estate, homebuilders and development industries for an afternoon of food and fun!
WHEN: September 27, 11:30-1:30 p.m.
WHERE: SMS Catering, 1764 Norland Rd., Charlotte, NC 28205
*Tickets may be purchased with corporate or personal credit cards*
Posted on September 6, 2018
Did you know NAIOP has a glossary of commercial real estate terms available online for your reference anytime? Bookmark the page for whenever you come across a phrase you don't know or need a refresher.
Posted on September 5, 2018
A total of 283 groups including NAIOP are asking the Trump administration to swiftly address particular drafting errors that were made in the Tax Cuts and Jobs Act before it was signed into law last year. In a letter sent to Treasury Secretary Steven Mnuchin, the groups asked specifically about two provisions: those dealing with qualified improvement property (QIP) and net operating losses (NOL).
QIP is a central concern for NAIOP, as we strongly support a shorter depreciation schedule. “Should the law be left unchanged, a real estate firm investing $5 million to renovate its property would lose out on more than $100,000 each year in deductions, money that could be spent on hiring new staff, or reinvesting in the business,” wrote NAIOP Chairman Jim Neyer in an op-ed for the Cincinnati Enquirer. “Worse yet, companies might decide to hold off on these projects,” Neyer warned.
The group letter makes a similar point. “The delay in correcting these provisions has caused economic hardship for some retailers, restaurants, members of the real estate industry, and suppliers of building products, and is also delaying investments across the economy that impact the communities in which these companies are doing business,” it says.
Posted on September 4, 2018
Written By: Dr. Hany Guirguis and Dr. Joshua Harris
The forecast for demand for industrial space has risen because of increased expectations of broad macroeconomic growth and job generation for the remainder of 2018 and 2019. According to Dr. Hany Guirguis of Manhattan College and Dr. Joshua Harris of New York University, quarterly net absorption is expected to increase to an average of 60 million square feet for the latter half of 2018 and then moderate to 56 million square feet per quarter in 2019.
Advance indications for gross domestic product (GDP) growth for the rest of 2018 show consensus forecasts approaching annualized growth of 4.0 percent for the second quarter, which could result in sustained growth of 3.0 percent or more for the rest of the year and into 2019. Higher oil prices are a leading cause of increased business investment because as oil prices rise, there is more incentive to increase energy production and commence energy exploration – activities that significantly stimulate the overall economy. Another major force at play is consumer spending, as e-commerce continues to generate demand for industrial space.
Posted on August 7, 2018
The Charlotte Planning Department is undergoing a comprehensive reorganization, in an effort to streamline the development approval process and reduce the number of conflicts that arise between final rezoning and site plan review.
The initiative is moving forward even as Charlotte’s Unified Development Ordinance takes a step back, to allow staff to begin work on a Comprehensive Plan to guide the City’s growth over the next two decades.
Posted on August 7, 2018
NAIOP Charlotte has partnered with CREW on their upcoming ABC Networking Event on September 20. Proceeds from the event help fund the scholarships with Queens University and UNC Charlotte.
Posted on August 6, 2018
Just hours before coverage was set to lapse for thousands of homeowners, the Senate approved a bill Tuesday to keep the National Flood Insurance Program operating for four more months. President Donald Trump is expected to sign the bill—which cleared the House last week—into law before midnight Tuesday, when the program expires.
“We applaud lawmakers for taking this needed action to prevent disruptions to closings in thousands of communities across the country,” Elizabeth Mendenhall, president of the National Association of REALTORS®, said in a statement. “Although the program is now extended through Nov. 30, the NFIP is in desperate need of reforms that will make the program solvent and sustainable for the long-term. The National Association of REALTORS® will continue fighting for these reforms.”
The NFIP provides critical flood insurance to homeowners in more than 22,000 communities nationwide, but Congress has wrestled for years with proposals to reform the program, which remains on shaky financial footing.
