On a morning of Wall Street and global equity market correction, sell-side signs in commercial RE mount, yet the secondary and tertiary markets that lagged and logged the least recovery look best from an investment standpoint. It’s all here at the Commercial Real Estate News Roundup for August 24, 2015.
- How Technology Is Shaping CRE, National Real Estate Investor, August 21, 2015 – The national leader in 20K+ sq ft. leases is tech and it’s not even close.
- Commercial Real Estate is Believed to be Overpriced, Realty Today, August 19, 2015 – More rumblings of a national price top from another research report.
- With Property Prices Hitting New Peaks, Where Do Brokers See Investment Opportunities?, CoStar, August 19, 2015 – Where? In a word, secondary and tertiary markets. Wait, that’s two words.
- Commercial Real Estate Market Getting Overpriced — Report, Pensions & Investments, August 18, 2015 – More from the sell side, this time with an institutional investment spin.
- Why I’m Optimistic about CRE for the Next Few Years, National Real Estate Investor, August 18, 2015 – Capital markets, low unemployment and more factors will extend the hot streak, says David Lynn.
- U.S. Top Country for Asian Outbound Property Investment, London Top City, World Property Journal, August 19, 2015 – Chinese capital’s record of landing in western capitals extends another year.
- Foreign Investment in U.S. Real Estate Assets to Hit Record High, National Real Estate Investor, August 19, 2015 – CoStar and RCA publish the numbers on foreign investment, and the numbers are big.
- Where Is the Demand for Office?, National Real Estate Investor, August 20, 2015 – Flat vacancy rates are driven by suburban gluts and other factors tallied up here.
- Office Today, Apts. Tomorrow: Office-To-Residential Conversions Expanding Across More U.S. CBDs, CoStar, August 19, 2015 – KC, St.Louis, Milwaukee and Cleveland are among the downtowns leaping on the trend.
- US Real Estate Emerging Market: Converting Upper Floors of Unused Brooklyn Retail Space into Offices, Realty Today, August 18, 2015 – Meanwhile in Brooklyn, even more surprising conversions.
- US Leads the Way in Logistics Clusters, GlobeSt.com, August 20, 2015 – 80 square feet per household: that’s how much warehousing and logistics space the US sports.
- Why the outlook is strong for industrial REITs, The Globe and Mail, August 18, 2015 – In Canada, the picture is rosy for industrial demand and so for investors looking to participate in the bonanza with share buys.
- Port Export Cargo Volumes Plummet, GlobeSt.com, August 18, 2015 – Perhaps in part fueled by Chinese and global equity market correction, west coast exports are down
- Too Much Atlanta Industrial Spec?, GlobeSt.com, August 18, 2015 – New industrial projects in Atlanta add up to concerns about saturation.
- Investor From Down Under Goes All In, Commercial Property Executive, August 20, 2015 – All in on retail with anchor stores such as Sears, says $175MM Aussie investor
- Skirmishing German Discount Grocery Rivals Roll out U.S. Store Plans, CoStar, August 19, 2015 – Grocery wars heat up in Los Angeles. A German company is guaranteed to win.
- Here Are 7 Online Retailers Going Brick-and-Mortar, BISNOW, August 18, 2015 – Upscale, upscale and upscale are how you’d describe these e-tailers foray into personalized customer service under a roof.
- Some MF Markets May Be in the 7th Inning, GlobeSt.com, August 20, 2015 – Once again, the greener pastures and more relaxed competition found in secondary markets, says veteran of multifamily sector.
- U.S. Developers Focus on Luxury Apartments Puts Added Pressure on Renters, World Property Journal, August 20, 2015 – How a boom in apartment construction actually adds up to fewer options for renters.
- Why Investors in Washington Multifamily Deal Don’t Stand Out from the Crowd, Commercial Property Executive, August 17, 2015 – Crowdsourced financing for a deal outside a Washington State airbase.
(Above: Fed Chair Janet Yellen addresses Congress).
Will she or won’t she (raise rates)?, Chinese capital jetting around the globe, Facebook’s $1B like-button storage facility, and hospitality sector optimism put to the test. It’s all here at the Commercial Real Estate News Roundup for August 20, 2015.
- CRE Market Plateauing? New Sentiment Survey Shows This May be the Case, National Real Estate Investor, August 13, 2015 – A note of caution is creeping into the red-hot national market for commercial space, says one survey.
- CRE Surge Sparks Bubble Fears, The Real Deal, August 13, 2015 – More anxiety about a market top.
- Market indicating Fed won’t raise rates in September, CNBC, August 12, 2015 – Will she or won’t she raise rates? CNBC, speaking for all fans of cheap money, hopes aloud that she won’t.
- New York Real Estate Just Got More Expensive For Chinese Investors, Realty Today, August 14, 2015 – The travails of pacific rim capital finding a home on Manhattan island.
- Chinese Investors Flocking to Thailand Property Deals, World Property Journal, August 13, 2015 – Stromg currency and a giant resort marketplace practically next door are adding up to a rise in Chinese investment in Thai property.
- Apartment-Construction Market Thrives in Berlin, Commercial Property Executive, August 11, 2015 – Cosmopolitan amenities including advanced housing concepts are making Berlin even more attractive to apartment developers and renters.
- Chinese Developer Buys Two Seaport Sites, GlobeSt.com, August 10, 2015 – At first I misread this as “buys two seaport cities,” and thought ” that seems like overkill”. But the fact that I even considered the possibility speaks volumes about how much capital is pouring out of China.
- Need Big-Box Space? Good luck, Industrial Experts Say, National Real Estate Investor, August 14, 2015 – Big-box new space demands are still there despite the ongoing war with e-commerce. Construction pace is lagging, says JLL industrial broker.
- Self-Storage Keeps Hitting Historic Highs, GlobeSt.com, August 13, 2015 – Growth in self-storage – at least as reflected by four key REITs – is pointed skyward.
- Data Centers Demand Rises as High as the Cloud(s), National Real Estate Investor, August 10, 2015 – Facebook’s $1B data center shows a growing sector passing a milestone and promising to knock down all future milestones.
- Economy Watch: See-Saw Retail Sales, Commercial Property Executive, August 14, 2015 – Census figures on retail sales look like a yo-yo from month to month, but year-over year are up 2.4%.
- Luxury Retailers Flourish, But Create Limited CRE Demand, National Real Estate Investor, August 13, 2015 – Revenues climb for the ritziest names in retail, but has that translated into expansions?
- Retail Supply Hasn’t Caught Up With Demand, GlobeSt.com, August 13, 2015 – On the west coast, product shortages are defining the commercial property market.
- Macy’s (M), Tishman Speyer Enter Real Estate Purchase-and-Sale Agreement in Brooklyn, StreetInsider.com, August 12, 2015 – Macy’s hops the borough border in a Brooklyn deal.
- The Future of Multifamily: Demand Continues to Rise, But How Will We Keep Up?, National Real Estate Investor, August 14, 2015 – How high does this rollercoaster go, anyway?
- MF Landlords Go All Out with Amenities, GlobeSt.com, August 14, 2015 – It’s not enough to offer apartments and space on the US’s most expensive land. Now, creativity has to appear in the Manhattan multifamily mix.
- Investors Bank Lending Grows in MF Sector, GlobeSt.com, August 13, 2015 – Investment bankers discover multifamily sector, suddenly realize their jobs include stepping away from the casino table to, you know, allocate capital.
- Multifamily Investors Flocking to the Granite State, Commercial Property Executive, August 12, 2015 – New Hampshire’s MF sector
- DC’s Unquenchable Thirst for Apartments, Commercial Property Executive, August 10, 2015
- French Lick Resort’s $600 Million Restoration Completed, World Property Journal, August 14, 2015 – A massive restoration of a classic resort in Indiana captures the imagination — and hundreds of millions in budget.
- Hotel Transaction Activity Reenergized in Charleston, Commercial Property Executive, August 14, 2015 – Take a look at the details of a $29MM 250-room JV transaction in Chucktown.
- Hoteliers Safe from Airbnb, For Now, GlobeSt.com, August 11, 2015 – Tech disruption of hospitality has reached its limits, say CEOs, but bond ratings agency wonders aloud if that’s pollyanna talking.
- Builders Plan Hundreds of Homes, Apartments in $700 Million Richardson Project, Dallas News, August 13, 2015 – North Texas: where the apartment deals run as big as the cattle ranches.
- Abele Fast-tracks Park East Land Sale to Bucks, Awaits Action by Comptroller, Milwaukee Business Journal, August 12, 2015
- Avon, Amherst commercial land sales top $1M, The Morning Journal, August 12, 2015 – Meanwhile, on the shores of Lake Erie, land deals are shaking the rust off the Rust Belt.
- John Paulson Reaps Real Estate Gains in Land Sales, Bloomberg Business, August 12, 2015 – A big, big land portfolio enters the sell side.
A distinguished panel of six commercial real estate experts took the stage in Chicago last week to share perspectives on the radically changing property market for health care.
Assembled at Bisnow’s 4th Annual Chicago Healthcare Real Estate event was a collection of operators, brokers, designers and developers of medical space, including Loyola University Health System’s Director of Real Estate Mike Becker, who kicked things off with an answer about what’s driving consolidation in the space.
“Size drives leverage and size drives scale,” said Becker. “It’s very important to a lot of folks acquiring space [that they get] to that significant size. The reality is that $130 billion has been pulled out of Medicare/Medicaid reimbursements, commercial payers have cut reimbursements significantly, so the larger you are, the more ability you have to negotiate buying power and larger reimbursements. Also, the play today is access to capital, and health care is still a bricks and mortar business…access to capital is easier and flows more freely if your size is more significant.”
John Wilson, President of healthcare property advisors HSA Primecare, added that consolidation was a confluence of three major trends: “Demographics, regulation and technology. In demographics, you have baby boomers, an estimate of 10,000 a day turning 65. So there’s ongoing pressure to the systems. With regulation, of course front and center is the Affordable Care Act, which is not only bringing the newly insured to the health care industry, it’s also shifting payment method from a fee based method to a value-based method, which is really driven by quality of care outcome. And then of course, technology – more and more procedures are moving to outpatient settings.”
Watch The Source for more coverage of the Bisnow Chicago Health Care Real Estate event.
This week’s announcement that Google will restructure itself and become one of a portfolio of companies under an umbrella named Alphabet adds even more mystery to the already guarded real estate plans of the technology giant. Headquartered in Mountain View, CA, Google owns or leases around 10 million square feet of space in locations across the US including 3.8 million sf. in Mountain View alone. Where is Alphabet’s business headed and what kind of space needs are in the cards?
A look at the SEC Form 8K they’ve filed telling stakeholders about the restructuring contains only a few clues. Their plan to create a holding company called Alphabet appears to accomplish a milestone separation. The core web and advertising services (which would include YouTube, Search, Maps, Android, and others) would remain within Google while the company’s major recent moves into biotech (Calico), internet service provision (Google Fiber), environmental controls (Nest), cutting-edge research and development (Google[X]) will be brought into Alphabet and under the direct financial guidance of founders Larry Page and Sergey Brin. At the same time, Larry and Sergey will hand the CEO role of Google to Sundar Pichai.
I see in this a classic sorting of business lines where the most capital-intensive and most speculative ventures are being pulled closer to the founding executives, making it so that an investment in Alphabet is a more direct investment in the vision of those executives.
While there’s no way to tell what direction Alphabet will take in space acquisition, I believe the loudest signals would come in the form of successes in its projects for driverless cars and national fiber optic rollout. Viable automotive designs mean industrial real estate in Alphabet’s future, and probably lots of it. And the more fiber Google can provide, the greater expansion demand for its own already-large data center construction.
More women needed in CRE, Orlando retail and office buildings are in great demand, industrial market strong in Kansas City and more. It’s all here at the Commercial Real Estate Real Estate Roundup for August 10, 2015.
- How Can CRE Industry Attract More Women?, GlobeSt.com, August 5, 2015 – Miami CREW builds network for women.
- Commercial Mortgages Rise 29% Y-O-Y, GlobeSt.com, August 4, 2015 – Going strong with the commercial mortgage rate rising 16% quarter to quarter.
- U.S. Construction Spending Climbs 0.1% in June, Market Watch, August 3, 2015 – Yes, 0.1% in residential, but flat in non-residential and commercial building.
- Orlando Retail and Office Spiking, GlobeSt.com, August 7, 2015 – According to commercial real estate brokerage firm, Marcus & Millichap job growth will be up in Orlando by 3.9 % this for a total of 44,000 more jobs.
- 5 Secondary Office Markets to Watch, National Real Estate Investor, August 7, 2015 – Real estate services firm, JLL reports office property sales were up 19.6 % this last year with Q2 2015 being the best quarter since the downturn of 2008.
- 5 Takeaways from Half-Year Office Sales Performance, National Real Estate Investor, August 3, 2015 – First half of 2015 shows 400% gain in sales in two secondary markets, Raleigh/Durham, N.C. and St. Louis, MO. according to New York’s RCA a data and analytics company.
- Industrial Developers Confident but Careful, GlobeSt.com, August 5, 2015 – Kevin Matzke with Clarius Partners reports ground will be broken for more large industrial space in Chicagoland in 2016.
- Kansas City Industrial Market Surges, GlobeSt.com, August 4, 2015 – Bureau of Labor Statistics reports a healthy outlook for Kansas City industrial employees this coming year.
- Who’s Opening and Closing Stores?, National Real Estate Investor, August 6, 2015 – Bed, Bath And Beyond looking fluffier as time goes on, while old-line grocery names are drooping.
- Retail Investors Prefer Coastal Markets, National Real Estate Investor, August 6, 2015 – The water brings the commerce, the commerce brings the customers.
- Retail is ‘A Big, Interconnected World’, GlobeSt.com, August 5, 2015 – JLL’s Leasing board welcomes a new expert.
- U.S. Builders Remain Optimistic about Senior Housing Market, World Property Journal, August 7, 2015 – The demographic truth behind the graying of the baby boomer generation has groundbreaking consequences.
- New Trends in MF Rental Patterns, GlobeSt.com, August 4, 2015 – Handling the disruption to decades-old patters of suburban migration is an apartment market near you.
- How Multifamily Developers Can Do Well and Do Good, BISNOW, August 3, 2015 – Why do good when you can do well AND do good? Well, you can do both. Which is good.
- Commercial Real Estate Roundup For August 3, 2015 (commercialsource.com)
Like-kind exchanges get a census, Q2 sales slump, office construction booms in ten markets, an intergovernmental turf war, and what does $12 million get you in Milwaukee? It’s all here at the Commercial Real Estate National News Roundup for August 3, 2015.
- Jim Mc Shane Shares His Thoughts On The Next Generation Of Leaders – REJournals, July 31, 2015 – A giant in spec buildings and leasing muses on the state of leadership.
- Like-Kind Exchanges: Highlights from Arizona -NAR, Economists’ Outlook Blog, July 31, 2015 – NAR article counts some 1031 exchanges and comes up with some interesting figures.
- Sales Growth Slow in Second Quarter – GlobeSt.com – July 27, 2015 – Is lower volume due to higher CAP rates, concern over potentially rising interest rates or something else?
- The 10B Real Estate Class : Lessons from the Case of WeWork – Coydavidson.com – July 30, 2015 – Shared office space matchmaker company snags giant valuation – Coy Davidson muses on the fallout.
- Top ten US markets for office construction from Len Rockwell – Lllenrock.com – July 29, 2015 – Raleigh at number ten and Houston at number one. Where is your market?
- 15 Years for Mega Office Leases – GlobeSt.com – July 30, 2015 – What starts with AutoTrader and ends with Google?
- Cincinnati Industrial Market Hits Historic Low – GlobeSt.com – July 31, 2015 – Just like the Cincinnati Reds 2015 baseball season, industrial markets in the Queen City are similarly slumping.
- Biotech Real Estate Boom Shows No Letup – GlobeSt.com – July 29, 2015 – Biotech growth reaches many corners of the country, says Boston conference.
- Twin Cities Industrial Market Accelerates – GlobeSt.com – July 29, 2015 – Minnesota’s submarket leads industrial growth with 90% new construction in bulk warehouse facilities.
Grandbridge Real Estate Capital Closes $8million Loan for Minnesota Apartment Complex – REJournals.com – July 30, 2015 – Minnesota apartment deal comes in with $8 million in insurance dollars.
Why You Shouldn’t Worry (yet) That Developers Are Bringing Too Many Apartment Units To Your City – ReJournals.com – July 31, 2015 – Apartment markets not saturated yet, says July Matrix survey.
Office of Inspector General Challenges HUD Policy Regarding Public Housing For Over-Income Families – JDOffice of Inspector General challenges HUD, intra-governmental turf war results.
- National Spotlight: Walmart Announces New Small-Footprint Stores in St. Louis – Llenrock.com – August 1, 2015 – Wal-Mart, The largest employer and retailer in the US gets small.
- App-less mobile tool strives to engage shoppers, boost traffic and sales – Retailcustomerexperience.com – July 31, 2015 – Exciting shoppers with apps in a marriage of brick and click.
- Marcus & Millichap sells Wisconsin department store for $12 million– REJournals.com – July 29, 2015 – What does $12 million get you in Milwaukee? Why, a shopping mall, of course.
Scattered retail expansion in Q2 of this year continued due to low interest rates and persistent consumer demand. Nationally, retailers continue to expand, re-tool their business models and test new markets. This, according to at least one market researcher, has added up to increasing demand for new-construction net lease assets that are in turn commanding premium prices due to the scarcity of these types of opportunities.
Lanie Rea, director of research for Chicago-based Stan Johnson Company, a firm specialized on single-tenant net lease properties, says in NREI that the Southeast is currently leading the nation in 4 million sq. ft. of net lease new construction in the pipeline. Apart from the West, the remaining regions are holding strong with an roughly 2.5 to 3.5 million sq. ft coming online.
Cap Rates Staying Low
Cap rates in Q2 of 2015 for single-tenant net least retail have remained unchanged at their historically low rate of 6.4 percent, according to research firm The Boulder Group. The boutique investment real estate firm that specializes in single tenant net lease properties reported that the overall supply of net lease assets was up over 20% in Q2 with retail assets leading all real estate sectors at 23 percent.
Reportedly, some of the rapid retail growth is stemming from drugstores, grocery stores, restaurants and discount stores including Dunkin’ Donuts, Walgreens and Dollar General . According to Crittendon Reseach, Inc., a national analysis and forecasting firm also cited aggressive growth in 2015 especially from retailers such as Dick’s Sporting Goods, Aldi, GNC, Advance Auto Parts and others.
According to industry expert Jonathan Hipp, President and CEO of the Calkain Group and author of “The Little Book of Triple Net Lease Investing”, the most active states for net lease activity from Q1 of 2015 were 1. California, 2. North Carolina & tied for 3. Florida/Arizona. The figures for Q2 haven’t been published yet, but based on the flurry of retail growth we’re waiting to see where this upward trend leads.
CCIM reports in their July-August 2015 issue of CIRE magazine that many factors including seller hesitation will help to limit the amount of available inventory in the retail net least market. See here for their synopsis.
While retail’s national economic health picture remains mixed with the commercial real estate recovery applied unevenly across the land, recovery stories are appearing that demonstrate what could yet be for the national retail property market as a whole.
In Yorkville, IL fifty miles west of Chicago stands a 600,000 sq. ft. shopping center named Kendall Marketplace. Kendall is a shadow of the original development plan of 800K sq. ft., a plan that ran into the historic buzzsaw of the 2007-2008 financial crisis. The development opened amid that chaos, trimming expectations for the intervening years.
The project lies at the extreme edge of suburban metro area, a gamble, ultimately, on sprawl. The trends of recent years leading back toward downtown living interest and development haven’t done Kendall any favors.
But seller representative Jones Lang Lasalle has the immediate surrounding area pegged for 13% growth during the next five years. Which in turn has Kendall’s owners, Greenwood Global Inc, doubling down on suburban lifestyle by buying residential zoned land surrounding Kendall. Brian J. Rogal writes for Globe St.:
“This is the area that was supposed to be the next to develop,” Alex Berman, founder of the Northbrook, IL-based [Greenwood], tells GlobeSt.com. The center’s developers originally planned to have about 800,000 square feet, but “the sales, while decent, were lower than expected and it wasn’t entirely built. Growth is returning and we will be happy to complete the project, although it may take time.”
Kendall Marketplace currently has about 590,000 square feet, which includes space occupied by shadow anchors Super Target, Home Depot and Kohl’s. Berman’s group bought 192,000 square feet of existing retail space anchored by Dick’s Sporting Goods, Marshalls and PetSmart, in addition to several vacant outparcels and adjacent residential land zoned for 192 single-family homes and townhomes. The price was not disclosed.
“We’re not a residential developer,” Berman adds, “but on the other hand, we think that as the property matures, the retail component will benefit the residential portion and the residential will benefit the retail.” Greenwood may eventually build the homes, or bring in a joint venture partner to help, but regardless of the route it takes, as demand for new housing in the area begins to swell again, Berman believes it’s important for the company to control this land.
Seniors, minorities and millenials push multifamily growth, industrial markets looking very healthy, more companies are moving their headquarters to urban centers, Class B housing on the rise for working class families and more. It’s all here at the Commercial Real Estate National News Roundup for July 27, 2015.
- Economy Watch: Does the Fed Foresee a CRE Bubble?, Commercial Property Executive, July 21, 2015 – Fed reports to Congress that underwriting standards for commercial deals are slipping. A precursor to finally raising the cost of money?
- A Millennial’s Perspective on Commercial Real Estate, National Real Estate Investor, July 21, 2015 – As 20- and 30-somethings join the CRE professional ranks, expect an uptick in information available online and a greater dependence on technology.
- Economy Watch: 3 Economic Trends Affecting CRE, Commercial Property Executive, July 20, 2015 – Residential and multi-family starts up considerably since last year which should mean the need for more retail and office properties.
- Suburb-to-City Migration Here to Stay, GlobeSt.com, July 23, 2015 – Companies who want to stay competitive with a younger urban workforce are abandoning their corporate campuses in the sticks for new downtown digs.
- Support-services Provider Citco Will Take on WeWork with its New Co-working Space, Crain’s, July 22, 2015 – Global financial companies now have access to co-working space in New York City via one of their trusted service providers.
- Class B Miramar Office Triples Value in 30 Months, GlobeSt.com, July 22, 2015 – One Florida market being driven mainly by investors seeking a haven for 1031 exchange proceeds.
- This Deal Shows Atlanta’s Industrial Health, GlobeSt.com, July 23, 2015 – 82% of industrial property under construction is over 500K SF, which is double the pre-recession average.
- Speed Lands Rare Big Box Industrial, GlobeSt.com, July 21, 2015 – To snag prime space in this tight submarket, lessees must act quickly, negotiate and be able to take occupancy quickly.
- US Industrials Ready for Another Record, GlobeSt.com, July 20, 2015 – Based on a survey of 60 markets, average vacancy rate is 7.3% which is lower than pre-recession rates.
- Why Street Stores Still Matter in the Age of Online Shopping, Commercial Observer, July 23, 2015 – A conference in local retail claims shopping is still an “emotional experience”, brick and mortar still best way to get products from retailers to consumers.
- Urbanization Is Retail Development’s Main Driver, National Real Estate Investor, July 23, 2015 – Expansion into densely populated existing nontraditional urban space is creating some very interesting retail experiences.
- How Retail Leasing is Changing, GlobeSt.com, July 21, 2015 – An extremely competitive market means retailers need to be more aggressive, creative and open to more non-prototypical locations and layouts.
- TruAmerica Expands in the Pacific Northwest, Commercial Property Executive, July 23, 2015 – Focus on creating Class B housing for working-class families who are being priced out of Seattle and Portland.
- Urban Institute Predicts Rental Surge Among Millennials, Minorities, Seniors, National Real Estate Investor, July 21, 2015 – Steadily increasing rental interest over the next 10 years for apartments and condos is expected.
- Multifamily Construction Surge Drives U.S. Housing Starts in June, World Property Journal, July 20, 2015 – Millenials continue to push starts in the multifamily markets.
The Building Owners and Managers Assocation (BOMA) International has just announced the updated version of their groundbreaking BOMA Energy Performance Contracting (BEPC) Model to incorporate new best practices into building maintenance. BEPC was originally created in 2008 by BOMA International in a partnership with the Clinton Climate Initiative (CCI), several major real estate companies and energy service companies (ESCOs).
BEPC Is Updated For Today’s Best Practices
Unfortunately, since the initiative started in 2008 there was not much market emphasis on retro-fitting buildings with new energy-saving technology during the crisis of ’07-’09. Now that the market has vastly improved and recovery is well underway, BOMA is updating and sharing their program more broadly with the commercial real estate world.
A standout for best practice from BPEC: investors are well-advised to be proactive in managing their assets so they can make strategic investments to drive rents and occupancy. Exhaustive management of utility expenses has become a best practice, but many of the older buildings have infrastructure that is approaching or at the end of its useful life, limiting potential to get a handle on all the utility usage information that true best practice calls for.
Gear To The Ground
You can’t manage what you can’t measure, and when it comes to sustainable ant truly controllable energy usage, that means extra equipment. Technology upgrades will be necessary in order for the buildings to remain competitive in today’s market. Such refits can be large capital projects tending toward the complex, carrying a variety of risks. However, the risk of doing nothing is very real, causing rising maintenance costs, utility costs, increasing complaints from tenants and potential tenants. Left unaddressed – especially in a competitive environment, these costs will negatively impact the owner’s bottom line sooner than later.
BOMA International Chair-Elect, Kent C. Gibson, BOMA Fellow, president of Capstone Property Management, LC. was quoted in BOMA’s press release, “BOMA International is pleased to provide building owners with a valuable resource that can help them increase asset value, improve operational efficiency and demonstrate to tenants a commitment to sustainability.” Among these are investigations into technology applications that will help understand what’s really called for to improve building performance and reap the true benefits.
BEPC Designed To Enhance Performance and Efficiency
The BOMA BEPC was designed to manage risk performance, facilitate projects that enhance building’s performance and efficiency and aid in delivering predictable returns on capital projects. BEPC provides a conceptual framework and supporting template documents to help private building operators develop and execute investment-grade retrofits to enhance the value of their properties. BEPC also provides transparency on performance expectations, pricing and a clear guidelines for managing their retrofit project so that the owners meet their goals and finish their projects within their desired timeline.
Since its beginning, BEPC has facilitated projects in more than twenty cities across five continents. The BEPC Model works with a variety of funding models including ESCO or third party, Property Assessed Clean Energy (PACE) programs and self-financing.