City Centers Create Sense of Community

City Centers Create Sense of Community

9 months ago 0 0 338

Atlanta’s edge cities are developing City Centers to create a sense of community, and it’s working. Since the holiday season is in full swing, it feels appropriate to continue the discussion about community I started in my last blog “The Importance of Community Engagement.” I suggested that leaning into our communities through service and events helps us feel more engaged. But I don’t believe that just happens. It is the addition of City Centers—intentional placemaking at its finest—that elevates the community’s sense of belonging. City Centers Help You Belong In a time when negativity, divisiveness and complaining feel ubiquitous, encouraging a sense of community offers people a positive feeling. While “sense of community” itself is difficult to quantify, it is absolutely a constructive and powerful force for a community’s overall health. Prime Example: Downtown Alpharetta The re-imagining of downtown Alpharetta is just one example of a city determined to craft

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The WeWork model looks weak. What is the SoftBank Group to do?

WeWork Weak? Looks That Way

10 months ago 0 0 362

A recent BisNow article looks at the impending takeover deal between SoftBank Group and The We Company, which values WeWork’s parent company between $7.5B and $8.5B. Here’s what I think: SoftBank is throwing good money away, but the company probably has zero choice if it wants to salvage any of its existing investment. I cannot believe SoftBank paid former CEO Adam Neumann that much money to step down; there must have been a reason. (The article states, “To take control over The We Company, SoftBank will buy $1B in stock from Neumann, pay him a $185M consulting fee and extend him $500M in credit to repay a loan led by JPMorgan.”) As I’ve considered in previous blogs, the WeWork model looks weak. The office market is probably peaked and likely will flatten at a time when WeWork has made its maximum space commitment to date. Also, no barriers exist for

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Community Engagement Makes Communities Stronger, like the Food That Rocks event at City Springs in Sandy Springs

The Importance of Community Engagement

10 months ago 0 1 456

Community Engagement Makes Lives Better Community is defined as a group of people living in the same place or having a particular characteristic in common. But I think it goes beyond that. Whether denoting a physical or religious connection or a bond through common interests, community engagement makes our lives better. Three years ago, in the blog “Atlanta’s Edge Cities Develop New City Centers,” I focused on the development of City Centers and their impacts. In subsequent blogs, I consider how these initiatives impact communities beyond just their physical existence. When you engage in actions or organizations that support the community in which you live, you improve the quality of life in that community. When you connect with people face-to-face in real time, you grow the fabric of your community. Community Engagement = Stronger Community Community Assistance Center As a Sandy Springs resident, I offer the Community Assistance Center (CAC)

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Investing in a CRE asset without due diligence or market analysis is just not smart.

Avoid the Sins of CRE Investment

12 months ago 0 0 311

A recent Globe St.com article “The Seven Deadly Sins of CRE Investment” argues, “Buying a CRE asset above its value or at a low cap rate is rarely a route to a successful transaction.” I couldn’t agree more. While situations exist where it is acceptable to pay up, such as the need to acquire a key piece in an assembly, I never advocate buying investment property without proper due diligence or market analysis. Unfortunately, vigorous deal competition coupled with the need to invest idle capital, particularly funds with time limits, inevitably leads investors to commit some of these sins mentioned in the article. After all, what is one or two bad deals in a large portfolio if the other deals are good, right? I disagree. Also, often individual investors invest foolishly because they are driven by the desire to avoid taxes on the gains resulting from a sale. So, they overpay to

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What is the worth of WeWork?

The Worth of WeWork?

1 year ago 0 0 395

Business Insider posted a recent article entitled, “NYU professor calls WeWork ‘WeWTF,’ says any Wall Street analyst who believes it’s worth over $10 billion is ‘lying, stupid, or both’.” Here’s my take on this article: WeWork looks like any other office landlord, just wearing a different suit. Outside of being cool, WeWork owns nothing proprietary, and as I have argued before, there is no barrier to competition from real landlords. If it were such a great concept, office property owners and developers would be providing more flexible space options. But they wouldn’t be able to obtain financing because debt service relies on a steady and reliable income stream—which this concept certainly is not. WeWork might pull off this IPO because of the current market euphoria, but they won’t be getting any of MY money.    

Family Office: Need to Do Due Diligence

Family Offices: Do Your Due Diligence

1 year ago 0 0 375

I recently read the National Real Estate Investor article “Survey Shows Family Offices Falling Short on Due Diligence for CRE Deals.” This article is 100% on point. Investors not familiar with the nuances of private real estate investments do not consider the elevated risks often posed by real estate, which result from its illiquidity, debt, lack of transparency, and reliance on a sponsor. Family-office professional DJ Van Keuren’s questions that family offices should ask during due diligence (modified below from the article) hit the mark. What is the sponsor’s track record? How long has the sponsor been in business? How much of its own money is the sponsor investing in the deal? What are some examples of deals that went south? How did you handle those situations? What is the market demand for this type of property? How many similar projects are in the local development pipeline? Has the sponsor run the numbers

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Atlanta Office Market: Hot or Not?

Atlanta Office Market: Hot or Not?

1 year ago 0 0 425

Think back to the office market in 1985. People were saying, “Nothing can go wrong. People are still coming.” Those same people were soon singing the blues because surprise, surprise, something went wrong. Is Atlanta’s office market as hot as it seems? BizNow’s recent article The Fastest-Growing Office Rents in the U.S. Are in Atlanta touts Atlanta’s office market success, but, in my opinion, fails to give a full picture. I see it more as a tale of two cities—the institutional office market and the local office market. Midtown + Buckhead: Hot Atlanta Office Markets Media likes to focus on the hot markets, like Midtown and Buckhead, and rightfully so, according to these stats: “Rents at premier office spaces in Midtown and Buckhead have risen 14.2% since last year, breaking the $50/SF ceiling for the first time.” Plus, 2.2M SF of new prime office space is underway with “Selig Enterprises

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In the Development Market Phase of the real estate cycle

Development Market Phase: How Long Will It Last?

1 year ago 0 0 441

The business cycle is “long in the tooth,” and the real estate cycle is also very, very mature. Last year, in Timing the Real Estate Cycle, I focused on real estate cycle phases, which included Recession, Distressed Selling, Value Creation (Stage 1 + Stage 2), Mature Investment Market, Development Market and Overdevelopment + Bust. Right now, we are in the Development Market phase. Here’s how I previously described it; see if it rings true. Rents and values are up. Vacancies are down. New construction accelerates. Investors…are flush with cash. Lenders are aggressive. Values of existing properties are peaking. There is simply more capital chasing deals than there are opportunities. The downside risk is increasing. The “nothing can go wrong” mentality is taking over.  New project announcements are appearing almost daily. Development Market Phase: Alive and Well Here’s what I see now: Transaction volume on the sale/investment side of business has

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Mentoring as an Investment in Our Young People and the Future

Mentoring: An Investment in the Future

1 year ago 0 2 628

My Dad was tough around the edges, but he was a kind and generous man. Whether it was family, friends, acquaintances or strangers in need, Dad always tried to help them get back on their feet. While I respected him as a businessman, my greatest admiration was due to his willingness to help others. A Legacy of Giving One way I choose to continue my father’s legacy of giving is by mentoring students and early career adults. A few years back, I wrote a series on mentoring. The first blog of the series offered industry professionals mentoring tips. The second blog advised how mentors can help young professionals in the CRE industry. And the final blog examined mentoring benefits. I am a mentoring advocate, whether you participate in a formal program, act informally as an advisor or assist a young colleague. I currently advise ten individuals. Formal Mentoring I participate

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Crowdfunding Becomes More Popular, But Skeptics Remain

Crowdfunding: A Viable Option?

1 year ago 0 0 575

National Real Estate Investor recently published an article titled Real Estate Crowdfunding Firms Push Further into the Mainstream, in which the writer argues that although first questioned, crowdfunding continues to gain a base of active sponsors and investors. One sponsor, using the CrowdStreet platform, says “it serves as a consistent, recurring source of equity, as well as a capital source that is accessible for smaller dollar amounts, under $3 million.” Crowdfunding: Who’s in the Crowd? Here’s what I think about crowdfunding: I like to enter a deal with the fewest, financially-qualified partners as possible. Either directly and indirectly having a large number of unknown partners pretty much scares me. I assume this approach works well when the market is good and properties are performing well. But I am always thinking ahead. What happens in a market slowdown, and a property funded by crowdfunding gets into trouble? The results could be very

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