Georgia's High-Profile Senate Races Drawing Big-Name CRE Donors

Both Senate seats in Georgia are up for grabs in next month's historic election, one that could see Democrats wrest control of not only the White House, but the House and Senate as well.

Many executives in Georgia's commercial real estate industry are throwing their financial support behind Republican candidates for both seats in an effort to keep the Senate in Republican hands as a potential check against Democrats who could yank back some favored tax programs if they ascend to the White House.

“There may be some [Biden] tax policies in place that real estate investors would find really troubling,” University of Georgia Professor of Political Science Charles Bullock said. “Controlling the Senate may be an insurance policy, or it may be the Republicans' best hope for a seat at the table."

Despite threats of rising corporate taxes and the elimination of the popular 1031 Exchange program, other real estate executives are putting their financial support to Democratic candidates for the Senate races as former Vice President Joe Biden holds a double-digit polling lead over President Donald Trump. Overall, Biden has taken in more donations from real estate than Trump.

“The commercial real estate industry is not going to thrive unless America as a cultural center of tolerance thrives,” said OA Development founder Steve Berman, who donated $1,500 to Democrat Jon Ossoff in his bid to unseat Sen. David Perdue. “This is an election where people are going to think more about what kind of country you want and [are] not going to contemplate tax cuts, which is the only thing the Republicans seem to be able to talk about."

For Republicans and those wanting to preserve the Trump administration's Tax Cuts and Jobs Act, passed in 2017, the Senate has become a key battleground. Keeping Republicans in control of the Senate could prevent a Biden administration from rolling back Trump tax cuts, Walker & Dunlop Chairman Willy Walker told Bisnow on Aug. 13.

“I hear a lot of people say what’d be ideal is a Biden presidency, but Republicans keep the Senate so the tax laws can’t get changed,” Walker said. “There are a lot of people who are fearful that if it’s a Biden presidency and a Democratically-controlled Senate that you get another tax bill that unwinds the Trump tax reform."

Biden has targeted raising the corporate tax rate as well as eliminating the 1031 Exchange program that allows real estate investors to avoid paying capital gains taxes after the sale of a property, so long as they reinvest the proceeds into another similar real estate deal.

Those proposals concern Seven Oaks Co. principal Bob Voyles, a longtime Atlanta office developer, who describes himself as an independent, but a fiscal conservative. He was motivated this election to contribute $1K to Perdue's campaign to protect the interests of business owners, he said.

“There are so few people in Washington that have any real substantive business experience. We need more folks like David Perdue in the Senate,” Voyles said. “This is a nonpartisan issue for me. I think we have too many lawyers and too many career politicians in Congress.”

Perdue has out-raised Ossoff thus far and has drawn 30% of the $48M donated to all the candidates for both Senate seats in Georgia, according to the Federal Elections Commission database. As of June 30, Perdue raised more than $14.8M, according to the FEC, but is running only slightly ahead in polls against Ossoff.

He also has attracted donations from some big commercial real estate names, according to FEC records, including from CBRE Vice Chairman Sam Holmes, The Brookdale Group co-founder Chip Davidson, Novare Grop CEO Jim Borders and Regent Partners Chairman David Allman.

Perdue, the former CEO of Reebok and Dollar General, also has attracted donations from national commercial real estate executives: Cushman & Wakefield Chairman John Cushman III, who has donated $5,600, and Tishman Speyer Chairman Jerry Speyer, who donated $2,800, according to FEC records.

“In my view, Perdue is the only choice,” said Avison Young principal Char Fortune, who contributed $1K to Perdue's campaign. “He's a businessman, and he understands the issues that businesses face.”

But some in CRE are putting financial support for the Democratic candidates in both races: Ossoff and the Rev. Raphael Warnock, who is leading Republicans Sen. Kelly Loeffler and Rep. Doug Collins in some polls in the special election for Georgia's other Senate seat.

Ossoff has attracted some local commercial real estate veterans as donors for this election, including Transwestern Managing Director Jon Kleinberg, Avison Young principal and member of the Atlanta Housing Board of Commissioners Kirk Rich and The Meddin Co. founder Stuart Meddin.

Berman said his support of Ossoff is being driven mainly by the growing rift between America's richest and the rest of the country. That divide, he said, is threatening the fabric of the U.S.

“We have a massive inequality in the way wealth has been distributed in this country,” Berman said. “If America is going to thrive as a country, we got to have equity in the way capital is distributed. I'm not saying it has to be equal, it just needs to be fair in the way it's distributed.”

The second Senate race has 21 contenders, jockeying for voter approval in a special election to fill the seat former Sen. Johnny Isakson left open when he retired in 2019. Loeffler was appointed by Georgia Gov. Brian Kemp in 2019 to fill the seat, and she has raised the most funds of any Georgia Senate candidate thus far, nearly $17.6M as of June 30.

The richest member of Congress, Loeffler has put more than $15M of her own money into the campaign, according to the Center for Responsive Politics.

Loeffler's CRE donors include AMLI Residential President Phil Tague, Novare's Borders, Cushman & Wakefield Executive Managing Director Andy Ghertner and David Stockert, the former CEO of Post Properties, which merged with multifamily firm MAA in 2016.

Collins, who has represented Georgia's 9th Congressional District since 2013, and Warnock, the senior pastor of the historic Ebenezer Baptist Church in Atlanta, the home pulpit for the late Martin Luther King Jr., are the two strongest contenders for the Senate seat in this election.

Collins raised more than $3.7M as of June 30, according to the FEC, attracting donations from some notable Atlanta commercial real estate players as well, including Wm Leonard & Co. founder Bill Leonard; Selig Enterprises Senior Vice President Chris Ahrenkiel, who also is a board member of Invest Atlanta, the city's economic development arm; and Preferred Real Estate Funds President Stan Sonenshine.

Warnock, the main Democratic challenger for the seat, raised $4.4M as of June 30, including from Atlanta developer Integral Group CEO Egbert Perry and from H.J. Russell & Co. President Jerome Russell.

Warnock also attracted donations from commercial real estate executives outside of Metro Atlanta, including $2,800 from Jeffrey Sussman, the president of New York-based Property Group Partners and $1K from Stanley Nitzberg, the principal at Chicago-based Mid-America Real Estate Corp.

The real estate industry contributed more than $208M this election cycle to federal candidates, parties and outside groups as of Aug. 21, according to the Center for Responsive Politics. Contributions to Republican candidates by industry pros outstripped those made to Democratic candidates. Roughly 58% of the industry’s contributions went to Republicans, while 42% went to Democrats. 

Georgia's Senate seats haven't been held by Democrats since former Sen. Max Cleland lost his re-election bid in 2003 and former Georgia Gov. Zell Miller — elected in 2000 to finish the term of the late Republican Sen. Paul Coverdell — declined to run for re-election in 2004.

Concerns about rising taxes were the motivation shared by a few interviewed by Bisnow to vote Republican in the upcoming Senate elections. Georgia has boomed under Perdue's tenure in the Senate, said Cresa Managing Principal Tom Tindall, especially around Georgia ports.

"David has elevated Georgia more from a national spotlight," Tindall said.

But those putting money behind Perdue and Loeffler in the hopes that Republicans hold on to Georgia's Senate seats may not be enough come Election Day, said Bullock, the Richard B. Russell Chair in Political Science at UGA.

“The Georgia contest may be decisive on who controls the Senate,” Bullock said. “This may be one that could slip away from Republicans.”