Author Archives: Tamara Small

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About Tamara Small

Tamara Small is the CEO of NAIOP Massachusetts.

Trends + Technology Marketing Conference: “It’s not the what, it’s the why”

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The following blog post was written by Danielle Simbliaris, Marketing Manager at Campanelli.

Elisif_20141022_5979Strap a GoPro to your dog to show perspective apartment tenants what a “day-in-the-life” of your pet is like, test out a virtual space via Oculus Rift, turn flat floor plans into a 3D interactive experience, drive tech-tenants to Fenway by bringing the sausage man to Kendall Square. These ideas and more were discussed during Wednesday’s Trends & Technology Marketing Conference as we dove below the surface level to discuss how marketing is driving transactions nationally and in the Boston market.

Andi Simpson, Director of Marketing & Corporate Communications for Federal Realty Investment Trust as well as Stephanie Williams, Senior Vice President of Planning & Advisory Services of Bozzuto Management Company presented a resonating quote, “It’s not the what, it’s the why”. Whether you are talking about retail, multi-family or office space, tenants are driven to make decisions based on why it will benefit them, not by what is being sold. As commercial real estate sales people, marketing professionals and owners, we are not selling a building of concrete and glass – we are selling a way it makes a tenant feel when they are there, a commute that may be convenient or not, an amenity package that can retain employees and keep apartment renters happy, a dog park that will make pet owners content. Michelle Mastrobattista, Director of Digital Communications at Solomon McCown demonstrated a recent social media campaign launched by her team for 101 Tremont (Paradigm Properties) where the account is written from the perspective of “Boston’s smartest entrepreneur”. She explained, “People use social media to communicate with other people, not buildings.”

So then the question becomes: what new, great, amazing tools do we have to sell that “why” to tenants? Rob MacLeod, Founder & President of Neoscape showed us ways we can bring a building to life via video using a combination of photography, 3D visualization, music and incredible editing that creates a visceral reaction from viewers. Moderator, Krista Bourque, Senior Associate for ADD Inc Branding Iron as well as Deniz Ferendeci, Senior Manager of Building Services at Dyer Brown Architects showed us many ways we can bring our buildings, fit plans, stacking plans and neighborhood to life with 3D, interactive imagery. Barbara Hicks, Senior Associate and Director of Marketing & Media at Margulies Perruzzi Architects as well as Tina Snyder, Director of Marketing at The Bulfinch Companies, Inc. both use video in e-blasts and marketing materials to retain the attention of clients and tenants. A recent video e-blast sent by Hicks helped Margulies Perruzzi land a meeting with a new perspective client that ultimately led to a $40M+ project partner.

Now we have some great new tools, and we are implementing fresh new ideas, but what does the future of real estate marketing hold? Moderator Linda Swain, SVP of Marketing for JLL showed a video of the professional in 2020 filled with Google Glass providing constant data, computers reminiscent of those in Avatar and iPad tours for constant connectivity. During the RE:Tech Demo Day, founder Ash Zandieh discussed the recently huge influx of real estate start-ups and introduced us to companies that will advance the way we access buildings, organize leasing and deal data for analysis, communicate with the community before developments begin and help us to go green.

View event photos

A Parking Spot in Boston – The New Endangered Species

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The Boston Globe recently ran an article, Spaced Out Downtown: Quest for parking in Boston worse than ever (October 4, 2014), observing that parking is becoming an endangered species in Boston, particularly in the Seaport.

It is very clear that the Seaport area is in the process of transitioning from servicing commuter parking for downtown Boston, to providing parking for its new residents and businesses. One of the culprits is the city’s parking freeze. With a parking inventory freeze in the Seaport, long-term availability of satellite surface parking is at odds with the construction of high-rise apartments and offices. As the amount of commuter parking diminishes, the stress on businesses in the downtown business district may get to the breaking point if employees find it difficult to find reasonably priced parking.

The most common reaction is that limiting parking will just accelerate the move to mass transit. If we had an effective, efficient transit system, that might be a reasonable answer. Unfortunately, the MBTA is operating at capacity during rush hours, satellite parking at transit stops is limited, and the condition of our trains and buses is questionable.

If we want to increase ridership and decrease vehicular commutes, let’s go “all in” and invest in a mass transit system that will be the envy of the rest of the country. However, in the meantime, let’s reevaluate the city’s parking freeze policy (one of the very few left in this country.)

Boston May Be Hurt By Its Development Successes

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Construction costs have been increasing steadily over the last four years, up 8% from 2011 to 2013 and they are on track for, at least, another 4% this year. That is good news for labor, but it may not be so good for future development. Material costs are also climbing with structural steel and reinforcing bars up double digits over the last 12 months. There are substantial increases projected for other building materials like gypsum, cement and lumber.

The explosion of construction has left some developers finding it more difficult to even attract bids from some subcontractors. After being burnt in the last downturn, many subcontracting companies scaled back and have chosen not to take the risks of accelerated expansions of their companies.

With new developments projected to start this year and next, and additional large scale projects on the drawing boards or in permitting, the demand for labor and materials will only increase, pushing costs up even higher.

What many developers are nervous about down the road is the start of the mega projects. The convention center expansion and the Winn casino in Everett are sure to “suck the oxygen” out of the construction environment.

Unfortunately, at some point the construction costs are going to make a number of commercial and/or multi-family developments infeasible. In a free market, one would expect labor to move into the area when demand is strong and supply limited. Unfortunately, our high cost of living (especially housing) will severely limit that correction in the market. The last recession brought down construction costs. Let’s hope we can find a different solution this time around.

NAIOP Remembers Ted Oatis

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Ted_OatisOur industry has lost another icon. Ted Oatis just passed away and leaves behind many friends and professionals who worked with him over the past decades. Ted was a creative, intelligent, and well liked developer, who partnered with Don Chiofaro since leaving CC&F with him in 1980. We will all miss him. Read more about Ted in this Boston Globe article.

A funeral Mass will be said at 2 p.m. Sept. 4 in St. Cecilia Church in Back Bay.

Where is Housing for the Middle Income Family?

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Thomas Grillo did an excellent job on BBJ’s recent article, “The story behind Greater Boston’s housing bottleneck”.

As rightly pointed out, communities have tightened permitting, making it harder to build and meet the demand for housing in general, and moderately priced and affordable units in particular. Zoning requirements have become more onerous with local rules and special by-laws, making the development process longer and more unpredictable. Interestingly, the municipalities and planners are crying out that they do not have enough control and want new land use reforms. However, there is currently a serious lack of permits issued for housing for families and these changes would actually hinder the production of reasonably priced housing.

Many communities have some of the strictest zoning in the region, with large minimum lot sizes, restrictions limiting multi-family housing, and unworkable cluster zoning ordinances. Opportunities for young families to rent a moderately price apartment or find a reasonably priced starter home is virtually impossible. The Massachusetts economy cannot fully expand without the support of its highly talented college graduates. Unfortunately, as the recovery continues nationally, local business leaders are finding it more difficult to attract the best talent when competing with other states. Economic development professionals across the country are already starting to attract young families out of our region and into areas that are more affordable, leaving us, yet again, with the risk of a declining skilled workforce.

The strangest trend to occur in housing production is that children have become society’s “toxic waste”! Many housing proposals that would attract families with school age kids are denied at the local level. More and more municipalities are fighting the permitting of three or four bedroom apartment units, or even requiring 55 and older residency age restrictions. If it appears that developments will bring children into the community, they are fought aggressively by the local boards. Even towns where the school populations are predicted to decline are reluctant to allow apartments that accommodate two or more children.

We are losing our 25 to 34 year olds at a faster clip than we are growing our total population. Our future is our young families and their children. Once and for all, we need to develop a serious policy that allows for the construction of family-friendly apartment housing and of smaller, denser, affordable, single family starter homes.

The future of our economy and our workforce depends on it.

Zoning Legislation Will Hinder Housing Production In Massachusetts

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In response to the June 2, 2014 Boston Globe editorial, “Sprawl takes a fall?,” NAIOP Massachusetts submitted the following Letter to the Editor: 

A recent Boston Globe editorial titled “Sprawl takes a fall?” urges the Legislature to pass zoning legislation with the incorrect assumption that the bill will result in the production of more reasonably priced housing. Unfortunately, the legislation would actually hinder, not encourage, the production of this much needed housing.

The bill makes a number of changes to the zoning law, Chapter 40A, which would apply statewide. However, many of the other changes would apply only in “opt-in” communities.  Key parts of the bill would limit predictability and add financial risks for expanding businesses in the Commonwealth. For these reasons, all of the industry trade groups in the state representing builders and developers strongly oppose this legislation.

The lack of workforce housing is a barrier to economic growth, limiting the ability of business leaders to attract the best talent when competing with other states with lower costs of living. Instead of passing this very problematic bill, we urge the Legislature to work with the Administration, municipalities and the business community to create a new program that truly encourages the production of denser and more affordable housing.

David I. Begelfer
CEO
NAIOP Massachusetts, The Commercial Real Estate Development Association

 

Patience Not Panic Needed with BRA

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A recent Globe article stated that three months into Mayor Walsh’s term, “the pipeline of major new (development) proposals has slowed to a trickle.” The implication is that the transition from the Menino Administration has left the Boston Redevelopment Authority rudderless.

I disagree. The final days of 2013 cannot be viewed as the norm for the Menino Administration. Virtually any developer with a project was aggressively pressing for its approval prior to year’s end. The BRA, most likely, set a record for the number of projects permitted.

Given that the Walsh administration has begun an in-depth audit of the BRA, it does not seem unreasonable that city leaders be given time to properly review the current process and propose needed changes in how projects are reviewed and permitted.

Less than 90 days have passed since Mayor Walsh took office. The last mayor had 20 years to shape the BRA’s review process. Before anyone questions the competency of the Walsh Administration, they should allow city leaders to get to know how the city operates and give them adequate time to make changes that could result in a stronger, more vibrant Boston.

NAIOP Responds to Boston Globe Article

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A February 23 article in The Boston Globe gives the impression that the development community encouraged the Massachusetts Department of Environmental Protection (MassDEP) to reduce standards for site cleanups to allow for faster approvals for developers. On the contrary, no part of the commercial real estate community either initiated or encouraged a review of the lengthy list of cleanup standards. The regulatory changes that are about to be released are a part of an agency-wide review, made all the more important by the need for this agency to be more efficient, given its limited resources.

In 1983, the legislature established an oil and hazardous waste cleanup program, Chapter 21E, formalizing the process for MassDEP to manage disposal sites. But with too few cleanups, unclear rules, delays in Department approvals, and insufficient resources, the cleanup process for contaminated sites quickly bogged down.  In response to this situation, the legislature overhauled Chapter 21E and the promulgation of regulations under the Massachusetts Contingency Plan (MCP) in 1993 created a new privatized, risk-based program. It eliminated the MassDEP backlog and allowed the Department to focus on the most complex sites.  Within the first two years of the program’s implementation, there were more than 3,200 permanent site cleanups. The success of this program made it a national model.

The MCP requires contamination to be cleaned up to a level that protects people and the environment, taking into account both the present and future use of the site. MassDEP developed conservative, detailed, contaminant-specific lists of both reportable concentrations and cleanup standards, based on the toxicity and mobility of the contaminants involved. Risk characterizations are used to determine whether detected contaminants pose a threat to human health or the environment and whether further comprehensive response actions are required.

The recent changes to these standards include some values that were increased, but also others that were decreased.  Each change was based on the latest scientific literature.  If MassDEP establishes a value based on science, does it not have the responsibility to adjust it either up or down, as the availability of new data dictates?

Massachusetts residents and businesses can and should continue to rely on a proven and protective program based on legitimate technical considerations. Emotional criticisms of every change in these standards are not conducive to the objective, science-based decision-making that has allowed Massachusetts to achieve a stellar track record in the successful transformation of blighted, contaminated sites into safe and productive community assets.

We Need Jobs, But Also Skilled Workers

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computer_handsThe Boston Globe recently reported that “the state’s tech sector is growing fast, but a shortage of qualified workers is preventing Massachusetts from becoming the capital of the nation’s innovation economy”, according to the 2014 State of Technology Report released by the Mass Technology Leadership Council. “Creating the jobs isn’t the hard part – filling them is the hard part,” said Tom Hopcroft, chief executive of MassTLC. “We can’t find enough people with the skills to fill all of these tech jobs.”

These are not the only types of jobs that remain open according to this Boston Globe graphic, which shows that it is not just the high end tech jobs that are having trouble finding workers.

So, what is worse – not having the jobs, or not being able to provide the workers for those companies that are expanding? It should be the former.  Trying to create new jobs is not only difficult, but there is actually no proven way to do it.  If what we have is a gap in training, or the proper transportation to access trained workers, we should be able to remedy that.

Local and state government should be partnering with local community colleges, vocational schools, and universities to work directly with those businesses that are fortunate enough to be growing and hiring.  If we don’t fix this imbalance expeditiously, we may have bigger problems.  Companies will begin expanding elsewhere and, then not having any local jobs to fill would be a lot worse.

Climate Change Preparedness: Commonwealth’s Investment an Important Step in Collaborative Process

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DB_testimonyAt Governor Patrick’s press conference today at the New England Aquarium, he announced  Climate Change Preparedness Initiatives funded by a $50 million state investment. Following Mayor Marty Walsh and Secretary Rick Sullivan, I spoke at the event representing the business community.

Climate change can have significant impacts affecting the overall economy; directly, by damaging structures, and indirectly, by compromising transportation systems, communications, and utilities.  There is no question that an increasing number of extreme weather events combined with future sea level rise require local and state agencies, building owners, lenders, insurance underwriters, and tenants to consider how to prepare for and respond to such events.

The business community believes that preparing for storm related events should be a shared responsibility between the public and private sectors. A primary role for city and state governments should be to ensure the continuity and protection of public infrastructure and public safety.  Stakeholders should be at the table with state and local decision makers early on in the process to prioritize short-term and long-term public and private responses. The business community, and the community at large, need to have a clear understanding of the government’s responsibilities for infrastructure and critical services.

Especially with New York City’s experience with Hurricane Sandy, we feel that Best Management Practices developed in other cities should be shared among public and private sector stakeholders, and their applicability to the Commonwealth should be carefully considered.

Finally, both costs and risks need to be evaluated when the public and private sectors consider climate change-related investments and improvement. With scarce resources, there will need to be a balance of adequate planning and a risk-based, cost-benefit analysis in order that funds are prudently expended.

Along with other business groups, we look forward to a true collaboration with state and local governments to safeguard all our valued resources.