BOMA's State of the Industry
A recent Real Estate Roundtable sentiment survey ranked overall market sentiment as a 49 out of 100, pointed out BOMA International president & COO Henry Chamberlain during his annual State of the Industry address this morning. While this is still a strong number, situations like Brexit and tighter debt markets are creating a bit of uncertainty in the market.
Overall, Class-A stock is doing well, but there has been a depreciation in Class-B stock globally. This year will end in the "Terrible Twos," he says, estimating that GDP will end up at 2% (modest growth), interest rates at 2% and inflation perhaps up to the same percentage. And although unemployment is still under 5%, last month was the worst in some time for job creation.
This is certainly a tenant's market; look at the popularity of names like Regus, LiquidSpace and WeWork, which are offering the flexibility and creativity tenants are looking for. Technology has been driving much of this, and we only have to look at what's being built around the world for names like Comcast and Apple.
"We're trying to solve a puzzle," he says. "How do we learn from this configuration and what tenants are looking for? We're all students."
The general session also included recognition of the 2016 Green Lease Leaders and Interior Lighting Campaign (ILC) awards by Dr. Kathleen Hogan, the Office of Energy Efficiency and Renewable Energy's deputy assistant secretary for energy efficiency. She discussed the environmental and economic benefits of energy efficiency, noting there's $83B in opportunities to reduce energy costs in the US, and all parties in a building need to get involved.
Above, some of the newest Green Lease Leaders, a designation created to recognize companies or brokerage teams that successfully implement green lease language into new or existing leases.
Recognized were Brandywine Realty Trust, the County of Cuyahoga, Ohio, the US General Services Administration, Ivanhoé Cambridge, The JBG Cos, PGIM and USAA. Team transaction awards went to IREM, GNP Realty Partners and the National Association of Realtors; Kilroy Realty Corp, YuMe and Allen Matkins; and Kilroy, Dropbox, CBRE and Allen Matkins.
ILC is a recognition and guidance program designed to help facility owners and managers take advantage of savings opportunities from high-efficiency interior lighting solutions. Honored were the Army Reserve 9th Mission Support Command, the Army Reserve 99th Regional Support Command, Baylor Scott and White Health, CHRISTUS Health, CKE Restaurant Holdings, Cleveland Clinic, Northern Arizona University, Sustainable Technologies, Target, T-Mobile, Tutera Real Estate, GSA and US Toy Co.
Both programs were developed with support from the Better Buildings Alliance, which was launched by the US Department of Energy to bring together leaders from the nation's commercial building industry to share and advance solutions in energy efficiency.
