Bookmarks: 5 Interesting Articles That May Help You This Week
/July 3oth, 2018
Each week, I select a few articles that rise above the fray and hopefully help you on your journey in the CRE world. They pull from one of four "corners:" corporate real estate, technology, management science and anything positive. I welcome your comments on these articles.
How Social Experience & Transportation Shaped the Last 10-Years of CRE Development"Elie Finegold: The forces (converging to change the CRE world are):
- Radical mobility – the ability for people to do all sorts of work and tasks from anywhere
- Service economy – the sharing of assets in an efficient way across a network of people
- Autonomy – drastically reduce the cost of moving people and goods around urban environments
All of this is part of a transportation network that is increasingly seamless, increasingly purpose built for going whatever distance you want, increasingly available on-demand, and the cost of which will decrease as autonomy becomes part of the equation. So it’s not just about people going places, it’s also about things coming to you. All of these things together, I still believe, will be one of the most profound shifts in the way that the built environment is utilized, since the invention of the mass-produced automobile." www.disruptcre.com[tweet_box design="box_09" float="none"]"So it’s not just about people going places, it’s also about things coming to you." By @ElieFinegold #cre[/tweet_box]
Atlanta’s Changing Transportation Ecosystem"Atlanta’s traffic woes are a well-known story. Despite having the nation’s 9th largest transit system, we are still an auto-centric city and region, rife with congestion along our main corridors. The lesser known story, perhaps, is the remarkable level of investment and coordination currently underway among our state and regional agencies to make significant changes in how Atlantans move around and through the region." www.atlanta.uli.org
How to Cure Your Dread of Public Speaking"Public speaking is so stressful for so many people that it is routinely used as a stress manipulation in psychological studies. Tell undergrads they have 10 minutes to prepare a speech that will be evaluated by experts, and their levels of the stress hormone cortisol shoot through the roof.Yet success in many roles requires speaking in public. In addition to presenting in my classes, I typically give a talk per week in front of groups. People ask me if speaking gets me nervous. It does not. And I give a lot of credit to my fascination with stand-up comedy. While I’m not a comedian myself, I’ve been a fan of comedians and their process for a long time, and I think there are three lessons that anyone can learn from them about public speaking." www.hbr.org
Much Of The US Electric Grid Could Go The Way of The Landline Phone “IF YOU’RE OLD enough to remember landlines, maybe you remember the feedback loop that turned them from must-haves to luxury items. As customers started switching to mobile, the phone companies had to raise rates on the cord keepers to cover the cost of their telephone lines. That only pushed more people to defect, exacerbating the problem—and increasing the cost.It’s this sort of feedback loop that worries Sonny Garg. He’s the head of energy research for Uptake Technologies and spearheaded the data analytics firm’s new report showing that over the past two decades, the investor-owned utilities that represent nearly half the US grid’s electrical load saw the effective cost of generating one megawatt of electricity rise 74 percent.
Making electricity, in other words, is becoming a less profitable business. And Garg worries that these costs will eventually reach consumers and send ripples throughout the economy. “You don’t need a huge amount of people to leave to cause a huge issue with the grid,” he says." www.wired.com
What Not to Do When You’re Trying to Motivate Your Team
“When leaders look like they are just applying some “motivational technique” they read about, people see right through the superficial, obligatory effort. It looks like they are checking off the “I motivated someone today” box. Motivation is not something you do to people. People ultimately choose to be motivated — when to give their best, go the extra mile, and offer radical ideas. The only thing leaders can do is shape the conditions under which others do, or don’t, choose to be motivated. But the final choice is theirs.Unfortunately, too few managers understand this, and so there is a gap between managers’ efforts and the results they’re getting. A 10-year study of more than 200,000 employees shows that 79% of employees who quit their jobs cite a lack of appreciation as a key reason, and according to Gallup’s 2017 “State of the American Workplace” report, only 21% agree their performance is managed in a way that motivates them to do outstanding work. Here are three of the most offensive forms of “motivating” I’ve seen managers employ, and three alternative approaches I’ve seen work wonderfully.” www.hbr.orgYour success blesses others. I wish you a great a hugely impactful week!
DevelopmentThe goal in 2018 for corporate America in 2018 is employee engagement. Read another way, employers want you to want to come to the office. On the development side, this is dramatically impacting what architects are drawing and where building is occurring. Infill development will continue to thrive. Buildings will continue to strive to look “authentic,” like Hines’ T3 development which will consist of a 200,000 heavy timber frame and wood building planned at Atlantic Station. Authentic design can be achieved using the right materials or by retrofitting an older building – the organic approach to real estate.The Emergence of the City CenterMaybe the 1950's are coming back to life in reimagined small town America. Seven city center projects are proposed or under construction around metro Atlanta including the Braves Stadium know as the Battery, Avalon in Alpharetta, City Springs in the City of Sandy Springs, Assembly in Doraville and others. People like working in a dense environment, but want to enjoy the cheaper housing and larger yards of the suburbs. Some have said the city center concept is the 21st century mall.Rental RatesNext year, rental rates on most classes will stop climbing as fast as they did in 2017 and concessions start to return in certain markets like Central Perimeter. I also believe there will be an uptick of subleases as growing companies are forced to move their operations in order to expand. There’s been an increase towards the end of 2017 and we believe there will be even more of this activity in 2018. The one exception to this forecast is newly delivered class A which is the hottest product in our city. Corporations with a pocket book will continue to drive rates in sexy new product to the highest our town has ever seen.Office Product TypesAs always, the market will continue to be a tale of the haves and the have nots. Rental rates notwithstanding, the haves will remain the most popular among tenants that can afford them and investors who pine for the latest and greatest. Take Three Alliance for example. The building experienced a rapid lease-up and has now traded for an historic price. Class B product with inefficient floorplates and lack of support amenities won’t experience near the rental rates of trophy Class A. Expect to see a trophy tower launch in an urban market with much more infill urban development/redevelopment. Finally, urban industrial product is becoming more attractive for redevelopment into creative loft office.Tenant DemandLast year, corporate America was catching its breath and approaching with caution because of uncertainty around administration, tax policy and the general business environment. However, with the Dow up 5,000 points in one year, which has never happened in history, the business economy is, and will remain, robust. I believe there will be continued organic growth and M&A activity in 2018. In board meetings and planning meetings, which are taking place right now, I believe businesses are planning for expansion in 2018. In 2017, many companies were a question mark, and that has turned into an exclamation point for 2018.Capital MarketsIn 2018, we anticipate cap rates will remain steady for suburban product. In the suburbs, there were misalligned expectations between sellers and buyers. Sellers forecasted continued rental rate increases, but buyers didn't agree. One can anticipate further cap rate compression in high rise urban and "cool" infill product - where she stops, nobody knows.TechnologyNext year will also be the year that the "internet of things" (IOT) begins to have a real impact on commercial real estate. It will rapidly improve the operating efficiency of commercial real estate, and it will be interesting to see what sort of role it will play for building owners and managers, as well as tenants. Building systems will let us know when they need service and save on labor cost. Maybe they'll bring you coffee at 2 in the afternoon, too.I saw a beautiful sentence in the Wall Street Journal recently: "investors have abandoned defensive positions, throwing caution to the wind." As you complete returning all those gifts back to Amazon, let's hope Santa is in a good mood all year in 2018. This economy is the gift that keeps on giving.Let's keep this ball rolling, shall we?