REALTORS® Land Institute Celebrates 70th Anniversary

English: Englefield estate Some paddocks and g...

Land: The basics of our business.

Frederik Heller, our manager of Library and Archives here at NAR is an invaluable resource for answers about just about every historical aspect of the real estate business.  I’m happy to say Mr. Heller has contributed a fascinating article about the REALTORS® Land Institute and I’ll be posting it here at The Source in a mini-series.  Here’s the first installment of “70 Years Of The REALTORS® Land Institute — Plus 24 More” – WG


The REALTORS® Land Institute (RLI) is celebrating 70 years of serving and representing the country’s land professionals. In January 1944, the National Association of REALTORS®’ Board of Directors met in Chicago and approved the formation of an Agricultural Institute, to meet the “growing demand for a strong national association of all farm brokers.” By June, the Institute had already established its first two chapters (Michigan and Iowa), changed its name to the Institute of Farm Brokers, launched its newsletter service, and was busy recruiting members.


But although RLI as a national organization got its start in 1944, their story actually began many years earlier. And that story doesn’t just tell how RLI came into being — RLI’s story also tells how the real estate industry came to look the way it does today. Land professionals and RLI played a vital role in shaping the real estate landscape and in the development of the REALTOR® organization.


To find out how the idea that evolved into RLI originated, we have to set the time machine back a few more decades. It’s important to understand first that when the National Association of REALTORS® was founded in 1908, real estate was a completely different world than the one you enjoy now. There was no 30-year mortgage, no real estate license laws, no Code of Ethics, the term REALTOR® didn’t exist, and even written contracts and multiple listing were relatively new concepts.


The job of a real estate broker was also much more all-encompassing than it is today. In 1908, real estate professionals didn’t refer to themselves as residential brokers, or commercial property specialists, or farm brokers. A real estate broker’s job often included work with all types of property, along with appraisals, mortgage finance, zoning, subdivision development, and other duties that we consider separate professions today. Property specialties and niche marketing were not recognized concepts at that time. If your job was concerned with any aspect of the transfer of real property from one owner to another, you were a real estate broker. The National Association of REALTORS® was organized in 1908 to give a unified voice to the general real estate broker, no matter what aspect of real estate they dealt in.


Right after World War I, however, that generalized notion of the real estate broker began to change, and it was farm and land professionals who first brought about that change. The majority of NAR’s first members came from urban and suburban areas, but it was the brokers in rural areas who first set themselves apart as a specialized branch of real estate practice. They came to understand that their businesses and clients were different from those of real estate brokers in the cities. They dealt primarily with farm and ranch land, and their clients were mostly farmers and others who lived and worked on the land.


Watch for the next installment of Fred Heller’s “70 Years Of The REALTORS® Land Institute — Plus 24 More” right here at The Source




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27. March 2014 by Wayne Grohl
Categories: NAR Research | Tags: , | 1 comment

Commercial Real Estate News Roundup: March 25, 2014

Location in Dallas

Location in Dallas (Photo credit: Wikipedia)

Pundits parse tea leaves, Baltimore Class A industrial properties draw a crowd, AirBnB keeps up the disruption, and farmland tops the list of good investments.  All this and more in this week’s commercial real estate news roundup.






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25. March 2014 by Wayne Grohl
Categories: News | Tags: , | 1 comment

Direct Investment In Self-Storage: Few Public REITs, No Waiting

English: Corridor with self-storage units (in ...


When H. Michael Schwartz, CEO of Strategic Storage Holdings, spoke in San Diego at the recent REISA Spring Symposium, the head of one of the top ten operators of self-storage said something interesting about the state of the marketplace in self-storage.


The role of self-storage with regard to multifamily has long been assumed – apartment dwellers on the whole occupy less space individually than homeowners yet display similar consumption patterns leading to a demand for space for their stuff.


But what’s interesting about self-storage as a sector today is the financing for such projects is not as institutionally available as with other sectors such as health care property, retail and office.  Few publicly traded real estate investment trusts (REITs) exist for self-storage while other sectors are well-represented by the dividend-throwing securities offerings.


Meanwhile, the self-storage market is “drafting off the success of multifamily,” according to H. Michael Schwartz of Strategic Storage Holdings. “We’ve been buying self-storage every year since 2005 and have seen traditional cap-rate compression, but also development opportunities. The lease-up opportunities from 2008-2011 are gone. We are now in a five-year phase of development.”


Schwartz adds that his firm is looking for retail locations in which to develop self-storage properties, and it looks at a 3- to 5-mile band to determine who its competition is. “We make sure we understand the market—what are people looking for in each market? What size unit? What features?”


The panelists also said the time is right for direct investing over REIT investing. “We’re not subject to the vagaries of the market the way a publicly traded vehicle would be,” said Lehew.


Schwartz added, “Public self-storage REITs are not developing, and this creates a nice alternative for investors in self-storage.”


For the $34 billion sector of real estate, there are only four publicly-traded REITs. The four include Public Storage (PSA), CubeSmart (CUBE),  Extra Space (EXR), and Sovran Self Storage (SSS).


The path that capital takes to get to a self-storage development is a short one these days — and is mainly routed around Wall Street.

Photo credit: Wikipedia




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19. March 2014 by Wayne Grohl
Categories: Self-Storage | Tags: , , , , , | 1 comment

Commercial Real Estate News Roundup: 3/18/2014

As recovery reaches well into secondary and tertiary property markets, good news is flowing from cities and towns we haven’t heard much good news from since before the crisis.






18. March 2014 by Wayne Grohl
Categories: News | Tags: , , , | Leave a comment

16 Banks Sued By FDIC Over LIBOR Rigging

A Washington Mutual in Naperville, Illinois pr...


It’s hard to find a commercial property lease or purchase finance calculation that doesn’t touch the LIBOR interest rate in some way. The benchmark interest rate is used so commonly, the total transactions subject to it is estimated in the trillions of dollars.

As I’ve written before, LIBOR lurks in so many corners of commercial real estate, it’s big news when the banks responsible for the rate’s publishing are suspected of rigging the number.

And it’s even bigger news when the US government’s biggest insurer of bank deposits — the FDIC — takes those banks where the US Justice Department won’t: to court. Which is exactly what happened this afternoon:

The FDIC, acting as receiver for 38 failed banks including Washington Mutual Bank, IndyMac Bank FSB and Colonial Bank, claimed that institutions sitting on the U.S. dollar Libor panel “fraudulently and collusively suppressed” the U.S. Libor rate. Also named in the suit, filed today in Manhattan federal court, is the British Bankers Association, an industry group.

The failed banks “reasonably expected that accurate representations of competitive market forces, and not fraudulent conduct or collusion,” would determine the benchmark, the FDIC said in its complaint.

Regulators around the world have been probing whether firms colluded to manipulate interest-rate benchmarks including Libor, which affects more than $300 trillion of securities worldwide. Financial institutions have paid about $6 billion so far to resolve criminal and civil claims in the U.S. and Europe that they manipulated benchmark interest rates.

The cost for global investment banks could climb to $46 billion, analysts at KBW, a unit of Stifel Financial Corp., said in a report last year. JPMorgan Chase & Co. and HSBC Holdings Plc may face a European Union complaint as soon as next month from the bloc’s antitrust chief.

Better late than never — and with TBTF banking’s massive influence over US and international law, “never” was certainly in the cards.



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14. March 2014 by Wayne Grohl
Categories: Leases | Tags: , , | Leave a comment

Commercial Real Estate News Roundup: March 11, 2014

English: 1225 Connecticut Avenue, N.W., locate...

Once again, it’s time to round up the major sectors of commercial real estate for the latest news. Tales of recovery, reversals and reinvestment abound:










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11. March 2014 by Wayne Grohl
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Retail Closings: New Numbers Are On The Way

English: A Radio Shack store in the Plaza Cara...

With the recent announcements by Sears, Staples and Radio Shack of huge numbers of national closures of retail stores, it’s time to look at national retail numbers to put the closures in context. Are we at the peak or at the beginning of a major correction in the retail space market?

Every five years, the US Census Bureau completes the Economic Census, a series of business reports that detail the US economy at a level of depth that makes researchers giddy for years.   You can find the US Economic Census publication schedule here and see that we are right on the cusp of seeing fresh numbers to replace the 2007 data set.

Until the first of the retail sector reports appear in July, we have to make do with numbers from before the economic crisis of 2008.  While there are plenty of data, one thing that jumps out at me is the square feet per capita.  In a word, it was huge in 2007.

As reported by Barbara Farfan in

Many experts believe that 2014 retail store closings are still due in large part to the overgrowth of the U.S. retail industry even before the U.S. Great Recession occurred.  According to the 2007 Economic Census, there were 1,122,703 retail establishments in the United States and a total of 14.2 billion square feet of retail space. That means that there is approximately 46.6 square feet of retail space per capita in the U.S., compared to two square feet per capita in India, 1.5 square feet per capita inMexico, 23 square feet per capita in the United Kingdom, 13 square feet per capita in Canada, and 6.5 square feet per capita in Australia.

With the explosive growth of Internet and mobile shopping, the oversaturation of physical retail locations operated by the largest U.S. retail chains becomes even more obvious. Downsizing the size of physical retail stores and the number of retail stores is a significant trend in U.S. retailing and it is a trend that will  undoubtedly continue throughout 2014 and beyond.

U.S. consumers are, in a sense, in charge of physical store closings. With their online and mobile shopping behaviors U.S. consumers are casting their vote for which retail store experiences have value and which ones can be easily replaced by their own Internet and mobile counterparts.   In response to these strong consumer preference shifts, many large, medium, and small retail chains will be closing physical retail store locations in 2014 because they can’t justify the dwindling sales per square footage results they produce.  The era of if-you-build-it-they-will-come retailing seems to have ended for the U.S. retail industry. 

With per capita numbers from the last decade looking that extreme, I can barely wait for what the 2014 Economic Census shows – sure to reflect much decline across the Great Recession, but by how much?  And how much is yet to come?  Stay tuned.

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10. March 2014 by Wayne Grohl
Categories: Research | Tags: , , , | 2 comments

Wal-Mart As Anchor…For Apartments

While I’m not sure if this is better imagined as news about a national urbanization trend or news about Walmart’s relentless expansion into new urban territories, the fact remains that Washington, DC’s two newest Walmart stores are a little different from what we’re used to. Rather than massive stores anchoring shopping centers, they’re sub 100k sq. ft. layouts serving as anchors for new apartment buildings.

The discount giant’s two newest DC stores bring an announced 600 jobs total to the city, and one building at 77 H Street, sporting 303 apartments has already been marketed and sold to Clarion Partners for an undisclosed figure.

Take a look at a video of the interior of the 77 H Street store and take in the unusual sight of Walmart’s unmistakable interiors and branding at the reduced scale of an urban anchor store.

View video here.

The stores are Walmart’s first in Washington DC.  The Walmart at First and H street runs 76,000 sq. ft and sports two floors of parking below-grade Walmart will officially open its first DC stores in two weeks. The locations on Georgia Avenue, and First and H Street NW will open their doors at 8am on December 4.

The 76,000 square-foot Walmart at 77 H Street NW (pictured above) will anchor a 303-unit apartment project. This location will have two floors of below-grade parking.

(Photo Credit: UrbanTurf DC)

07. March 2014 by Wayne Grohl
Categories: Retail | Tags: , , , | Leave a comment

Placemaking for REALTOR® Associations

Placemaking for REALTOR Associations

The challenge of urban planning is eternal, but its vocabulary and techniques evolve. The latest wrinkle in the field is the concept of placemaking, a friendly word encompassing the dirty details and hard work of turning around underused and uninviting features of a community. Vacant lots, dilapidated sidewalks, stretches of vacant storefronts, poorly maintained streets all serve to drive down community morale, lower property values and to repel imagination and the investment that follows it. Fixing these problems is not easy, as government and community and landowners and real estate pros all need to get on the same page.

Placemaking addresses the fact that markets alone can’t always combat blight and that planning and community direction of some kind must co-exist with purely commercial approaches in order to successfully turn blighted areas into inviting, usable, accessible and safe places.

REALTORS® On Point (As Usual)

Naturally, REALTORS® and their associations are in ideal positions within their communities to see up close what areas need work and to have an advanced sense of what is needed to revitalize an area.  Even though that’s a significant head start, the challenges remain: how exactly does need translate into action steps?

Happily, NAR has some great answers.  Check out NAR’s recently published (and excellent) 38-page guide to placemaking (available for free download here).

Packed with examples from around the country, “Placemaking for REALTOR® Associations” will open your eyes to credible, proven solutions to thorny problems of blight and accessibility.  Unsurprisingly, we find that when REALTOR® associations take the lead in their community efforts against dilapidation, it greatly increases the chances of success.

Project For Public Spaces

Foundational to the approaches NAR compiles in this guide is the work of the Project for Public Spaces, a venerable nonprofit dedicated to neighborhood revitalization success since 1975.  Check out a 2008 NYT article on PPS here.

Download the NAR Guide “Placemaking for REALTOR  Associations” here.

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06. March 2014 by Wayne Grohl
Categories: NAR Publications | Tags: , , , , , , | Leave a comment

NAR Community Outreach Success

REALTORS® help build communities. As a commercial practitioner, find out how NAR’s Community Outreach Programs can help you make a difference in 2014. Visit the Community Outreach Facebook page or

05. March 2014 by Jorge Rivera
Categories: Property | Leave a comment

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