Posts from IBS 2012: part 1

There was certainly a much more positive vibe at this year's IBS Show. Not nearly as vibrant as the recent apartment industry events but much improved year over year. There were still some big names noticeably absent from the exhibit floor but my sense is that the tide has started to turn and we will start to see a more aggressive stance in the second half of 2012. The lack of new supply, improving employment picture and rising rents should accelerate the enthusiasm this Spring.


To quote Tom Toomey,(CEO of UDR) back in early 2011..."apartment developers are going to look back on these times and wonder why they weren't more aggressive..." I think the same can now be said about home builders and vendors in the single family segment. 

There was definitely a buzz about multifamily applications for traditional building products. I was able to snap a few pictures at some of the visits I made this week. Giving the "illusion of custom" is a theme that is going to resonate with Gen Y renters. I expect to see building product manufacturers start to get more aggressive in participating in the growth of multifamily construction as well.


Here are a few interesting ideas for multifamily housing at the builder show: 

Rubbermaid: Closets that can be easily customized and replaced on the turn. This wire shelving is GREENGUARD Certified and can be upgraded to give a "walk-in" feel (not shown). 

Tim O'Connor demonstrates the ease of installation of Sterling's  new line of   Bathtub Showers made of Vikrell. Popular for new construction and renovation in the multifamily space. 

NanaWall shows off its glass wall system that can be installed on balconies.  More functional space and noise reduction in your older product in need of a facelift. 

Apartment Finance Today Conference 2012

Four Seasons, Las Vegas

It's about time to start thinking about the Apartment Finance Today Conference in Las Vegas. This is the first time we are in this location and we are doing it in style (with a sub $200 room rate!).

You must be an owner, developer or operator to attend but we have great sponsor programs that include a table top in our Sponsor Room, which is also where we have all of the networking functions.

Here is a summary of what you can expect:

Fundamentals are phenomenal. Interest rates are at historic lows. Debt and equity sources want nothing more than to leverage hugely profitable yield opportunities that will come from putting capital to work in the apartment space right now.

But whether it’s new construction, value add, or a permanent loan, your biggest challenge is to get investors and lenders to look at your deal, to get your project in the ground now, to get the chance to ride what promises to be a strong upward cycle.

At this year’s event, held April 2–3, 2012 at the luxurious Four Seasons Las Vegas, you’ll find a dozen interactive sessions, beneficial networking opportunities, first-rate speakers, and must-attend programming designed exclusively for apartment developers and owners. 

Scheduled Speakers (more to come): 

Ron Terwilliger, Keynote

David Abromowitz, Center for American Progress (tentative)

Jerry Ascierto, Apartment Finance Today

Doug Bibby, NMHC

Tom Booher, PNC Real Estate

David Durning, Prudential Mortgage Capital

Mel Gamzon, Senior Housing Investment Advisors

Lee Harris, Cohen Esrey

Guy Johnson, Johnson Capital

Rich Kelly, LumaCorp

Charles Krawitz, Fifth Third Bank

Brent Little, Fountain Residential Partners

Heidi McKibben, Fannie Mae

John McManus, Apartment Finance Today

Trip Stephens, ZOM

Here is a complete outline of the programming: 

MONDAY, APRIL 2, 2012

General Session

1 p.m. – 2:30 p.m. Vision for 2012: Editorial Advisory Board & Leadership Roundtable

For the past few years, real estate executives and multifamily leaders have predicted that the apartment sector is riding a boom period unparalleled in recent history. For 2012 to live up to the hype, and be ripe with new deals and developments, innovative financing, and revenue-generating opportunities, companies will require a clear strategic vision. This panel of a dozen industry leaders from across the debt and equity, operations, and development segments of the multifamily business will offer their no-holds-barred insights, perspectives, and forecasts for the coming year.

Coffee Break 2:30 p.m. – 3 p.m.

General Session

3 p.m. – 4 p.m.  Sound and Fury: Inside the GSE Reform Debate

With more than two-dozen bills still in circulation around housing financing reform, the future of Fannie Mae and Freddie Mac is precarious at best. Yet despite the frenzy of activity, the debate has been placed largely on hold until after the 2012 election. In this panel, industry watchers and lobbyists discuss the underlying currents on Capitol Hill and take a hard look at what the current piecemeal legislative attempts for action could mean for the future of the GSEs—and the apartment industry that relies on their financial security.

Keynote Session

4 p.m. – 5 p.m. J. Ronald Terwilliger: My Life as a Developer

Ron Terwilliger, the man likely responsible for developing more units than anyone in the industry’s history, will offer his insights into how the current cycle differs from past cycles, and how you can best position your company to ride the next great upturn. During his 25-year tenure at the helm of Trammell Crow Residential, Terwilliger established the firm as the nation’s most prolific and best-run development firm, providing a model of best practices for the industry to emulate. But he’s also a powerful advocate in the housing industry, having established the ULI Terwilliger Center for Workforce Housing, and serving as chairman of Enterprise Community Partners and Habitat for Humanity’s global capital campaign. This keynote presentation will also include his thoughts on the future of housing finance, the government’s role in supporting workforce and affordable housing, and what the future of the government-sponsored enterprises means to your business.

5 p.m. – 6:30 p.m. Networking Reception

TUESDAY, APRIL 3, 2012

8:00 a.m. – 9:00 a.m. Breakfast & Roundtables

Hot Topics Roundtables

Description: Join your colleagues for a moderated, informative breakfast conversation about challenges and opportunities within the various apartment sectors and niches seeing growth in recent years.

•             Affordable Housing

•             Student Housing

•             Seniors Housing

•             Distressed Assets

Keynote Session

9:00 a.m. – 10:30 a.m. Meet the Money: AFT Takes You Inside the Art & Science of the Loan

The lending environment is a fickle one these days. What’s in favor (and available) one day is out of reach the next. In this interactive, provocative, fast-paced session, the editors of Apartment Finance Today bring borrowers and lenders to the table to offer the inside scoop on who’s lending, on what terms, and for what types of assets. On one side of the table, borrowers, ranging from Class A acquisition experts to value-add owner/operators to niche developers. On the other side, lenders who represent institutional, government, and bank money across the board. This panel of all-stars will offer insights into exactly what it takes to close a deal in the current environment.

10:30 a.m. – 11 a.m.  Coffee Break

General Session

11 a.m. – 12 p.m.  Opening the Gates: Equity Investors Step up Their Game

After retreating to the sidelines and cinching their purse strings through the height of the recession, equity investors re-entered the new development and recapitalization markets in 2011. Now, as the industry navigates another year of uncertain yields and frenzied activity, equity investors have committed to deploying capital before it’s too late. This panel of equity investors will offer their thoughts on where return expectations are headed, how risk levels are evolving, and where to find the right partner for your next deal.

12 p.m. – 1:30 p.m. Lunch & Roundtables

Join your colleagues for a moderated, informative lunch conversation about dealmaking, financing, and operational trends in a number of local markets around the country. 

•             Northeast Corridor

•             Southeast

•             Texas

•             California

•             Pacific Northwest

•             Midwest

General Session

1:30 p.m. – 2:30 p.m. To the Max: How to Push NOI to New Heights

As a stream of residents flees homeownership and flocks to apartment living, the opportunity to maximize revenue and net operating income is huge. Whether through rent maximization, resident retention, innovative renewal strategies, ancillary income and revenue sources, or cost cutting measures, this panel of operational experts will offer advice, tips, and strategies for making every dollar drive value. Guaranteed, you’ll walk away from this high-energy, conversational panel with at least a dozen ideas on how to make every initiative impact the bottom line.

General Session

2:30 p.m. – 3:30 p.m. Construction Capital‘s Comeback: Beyond the Blueprint

Description: After a 2010 that saw a drastic reduction in starts and a 2011 that saw only a minor uptick in new development activity, 2012 is poised to be the multifamily construction sector’s busiest and most successful year since the start of the Great Recession. But as shovel meets dirt across the country, developers are simultaneously digging for dollars, ready to work closely with banks, the FHA, and other lenders to ensure their construction plans see life beyond the blueprint. This panel of developers and lenders offer their observations on the current state of construction lending—and how to make the development boom last.

3:30 p.m. – 4 p.m. Coffee Break

General Session

4 p.m. – 5:30 p.m. A Renter’s World: Apartment Finance Today’s Annual Economic Outlook

Description: Economists and researchers alike agree that 2015 may mark the peak of an economic recovery that favors renters and apartment fundamentals. But not everyone is convinced that a renter nation is here. This panel brings together some of the housing industry’s brightest economists to discuss the outlook for rent fundamentals and local market metrics in an ever-changing economy. Don’t miss this informative, data-driven panel, which will be sure to offer all-new information on the numbers that matter most to you.

5:30 p.m. – 6:30 p.m. Networking Reception

NMHC Annual Meeting 2012: Day 2

Meetings continued in earnest...


For a summary of key points in real time check the Twitter feed here: http://www.nmhc.org/Content/ServeContent.cfm?ContentItemID=6479

For all the talk and optimism you still get the sense that industry players are trying to figure out how to best move forward. After years of stagnation, budget cuts and doing "more with less" have we forgotten what it looks like to manage business in a boom? 


Maybe it is time to get back to basics: define your value proposition, re-visit your brand promise, look to best of breed vendors for assistance. Get back to focusing on your core business...and make sure people know what that is...the tactical executions will take care of themselves. 


Just a thought...


Here is a bit more from the radio feed. 

Natalie's Wish, 2008

More Than $1.8 Million Raised at Natalie’s Wish Fundraiser

Once again, it was a great privilege for me to attend the Natalie's Wish Fundraiser in Newport Beach last week. Since 2003, the annual event for the Cystinosis Research Foundation has raised more than $8.3 million, all of which is being used to fund research to develop better treatments and a cure for the rare, genetic and slowly fatal metabolic disorder that afflicts about 2,000 people, mostly children, worldwide.

Natalie Stack is 17 and has suffered from the effects of Cystinosis since birth. She is certainly an inspiration but what strikes me as most remarkable is the impact that she and her entire family have been able to have on this disease. They are committed to all aspects of finding a cure: raising money for research, being directly involved with organizing the medical community, engaging an extremely supportive group of friends and bringing together others who suffer with the disease.

It is hard to convey the energy, spirit and motivation among the entire group who attend this unique event. So I will stop there and just say that you should strongly consider attending next year.

For more information about Natalie’s Wish and the Cystinosis Research Foundation, call Zoe Solsby at (949) 223-7610 or visit www.natalieswish.org

Home Builder Conference Observations

The Builder 100 Conference has just wrapped up down in Scottsdale, AZ and I stopped in briefly yesterday to get a feel for what our single-family counterparts were facing. Rather than focus too much more on another set of predictions/guesses for the future, I wanted to call out some observations that were made in a couple sessions that are relevant to multifamily housing.

1. Conservative Journalist Tucker Carlson pointed out the 2 key issues that he thought would prevent Republicans from advancing in this year's elections: the continued rise of immigration and the rates of single, childless women. Both rates are the highest we have ever seen and have obvious ramifications for the housing markets that we need to note. After doing some cursory research on the latter topic it was interesting to find that fertility rates are still rising because women who are having children are having more.

2. One of the nation's largest homebuilders cited a stat that I found very interesting. Based on his own follow-up surveys, his firm was not following up with more than 40% of the folks who filled out registration cards at open houses. High quality leads. Sales training is a huge issue with homebuilders the same way it is with multifamily housing executives and service providers. When times are good no one focuses on training (order taking) and when times are bad the troubles are magnified and we have less time and resources to address them.

3. The need to understand workforce housing is "more important than Green." - Jeff Mezger, CEO of KB Home

4. Jeff also spoke a lot about the concept and implementation of sustainability. He doesn't spend much time pushing Green Marketing but does look intensively at the low hanging fruit where costs can be saved, from products to land plans. We have an entire magazine dedicated to this concept called Developer. So I was happy to hear that this topic is moving up the agenda for production builders.

These are just a few of many takeaways from this event. Stay tuned for the wrap up from our friends at Builder.

Maximize NOI

Day 2 of the Apartment Finance Today Conference covered some interesting NOI Building ideas. Since deal velocity has slowed considerably it's time to get back to basics and maximize efficiencies. Lee Harris (Cohen-Esrey), Richard Kelly (LumaCorp), Dave Richitelli (ista North America) and Jeff Kelly (Tucson Realty & Trust) spent some time digging into the multitude of ideas out there that WILL increase NOI if we take the time to get educated.

Some of the topics:

• Credit Cards - reduce bad debt and attract renters
• Revenue Management - manage expirations and realize quick payback
• Green ideas that save money - Lighting, monitoring gas boilers, irrigation efficiencies and submetering
• Trash removal, Low Cost Physical Improvements and Surety Bonds

Focusing on customer service needs to be a core competency of apartment operators. Those with a sound strategy will whether any storm. Especially those caused by speculators who were in the business for a quick hit. This customer service theme was also emphasized in the Keynote by Dr. Tony Downs from the Brookings Institution.

The discussion that took place was lively and participants were enthusiastic about making investments in products and services that offered immediate ROI.

Apartment Finance Today Conference

We are closing in on the Apartment Finance Today Conference. The dates are April 7-9, 2008 at the Arizona Biltmore in Phoenix.

AFTC is relatively new to the conference scene but offers tremendous value to vendors who are looking to connect with customers and meet new prospects. Here are some of the highlights:

• 3 days of solid programming beginning with the Apartment Industry Leadership Roundtable and concluding with programs on Green Building, CMBS Market and Student Housing.
• The "AFT Forecast for Rental Demand."
  
• Daily networking opportunities on an intimate exhibit floor that is limited to only 30 booths.
• In 2007 we had more than 300 attendees. A majority of these attendees owned more than 2500 units and on average, each planned to develop more than 371 and acquire more than 500 units in the coming year.
  

So don't let the name fool you. The Apartment Finance Today Conference is much more than finance and a fancy hotel.

A Sample List of Participating Vendors in 07/08:
PNC ARCS, Assurant Specialty Property, Centerline, GreenPark Financial, Stewart Title, Verizon Enhanced Communities, Wachovia, Arbor Commercial Mortgage, Saflok, Sage Water, Reznick Group, Sperry Van Ness, Nichiha, Empire Construction, Commercial Defeasance, CW Capital, Commercial Insurance, Greystone, PASSCO, Red Capital, First Advantage SafeRent, Pierce Eislen and Aries Capital.

Call us for a list of 2007 attendees.

Enterprise Community Investment

The NCSHA Housing Credit Conference is in San Francisco this week. I wanted to report in on the Enterprise Community Investment reception that took place last night at the SF Marriott.

The food was exceptional and the wine flights were even better.

Most importantly we were able to catch up with our friends at Enterprise and their guests right in our own backyard. This year signifies their 25th anniversary as leaders in community development. We salute their tremendous commitment to housing and fine work accomplished.

Enterprise remains focused on 4 core housing initiatives in 2007 which include: Green Communities, Gulf Coast rebuilding, preservation of affordable housing stock and housing combined with supportive services. We are closely aligned in many of these areas and are proud to call them partners of our multifamily group.

Special thanks to Jeffrey Donahue (President & Chief Executive Officer), Charlie Werhane, Audrey Easaw and Andrea Schleicher for their hospitality.

Top photo (l to r): Andrea Schleicher & Audrey Easaw
Bottom photo: Jeffrey Donahue, Audrey Easaw and Charlie Werhane

Natalie's Wish

On June 1, 2007 I attended the sixth annual Natalie’s Wish fundraising dinner in Newport Beach.

The event at the Balboa Bay Club drew 460 persons. It was organized by Corona del Mar residents Jeff and Nancy Stack, founders of the Cystinosis Research Foundation and parents of 16-year-old Natalie Stack, who was diagnosed with cystinosis as an infant. As many of you know, Jeff Stack is also a principal and managing director at the Sares-Regis Group based in Irvine.

Other multifamily housing industry executives on hand included Michael Hayde, Dave Christensen, Dave Schwehm, Mike Mueller and Dirk Wakeham to name a few.

The event was first-class and extremely inspirational. Former Buffalo Bills quarterback Jim Kelly gave the keynote address and several families impacted by the disease shared their stories with all of us. This year more than $2 Million was raised for the Cystinosis Research Foundation. The amount is particularly impressive to me because every dime raised goes directly to cystinosis research.

For more information about Natalie’s Wish and the Cystinosis Research Foundation, call Zoe Solsby at (949) 223-7610 or visit http://www.natalieswish.org/.