Like a terrible hairdo, our Construction & Development Summit last week had two parts. You can read the construction-design-engineering outlook here. Today, we bring you our development panel of all-stars discussing their latest projects.
Moderator Charles Higley
, partner at Coblentz Patch Duffy & Bass, kicked off by asking our panelists about the overarching vision their companies pursue, and a 30,000-foot perspective
on each one's particular market segment. Charles' transactional RE practice emphasizes advising developers on land-use entitlements,
CEQA compliance, and design and construction.
With two multifamily developments under construction and another in planning, Madison Park Financial president John Protopappas
says his company specializes in the urban, supply-constrained market in the East Bay
. As the only for-profit developer under construction in Oakland right now, he's drafting
off of San Francisco's apartment building spree and rising prices—one of his projects is just 15 minutes
away in West Oakland at 50% of the rent
. "All we've got to do is build it and we'll fill it." Madison's projects include Bakery Lofts
, three phases totaling 172 units with a little bit of office and retail, and the 92-unit Lampwork Lofts
, the adaptive reuse of a former lightbulb factory. According to John, Madison Park is a relatively small firm: $250M in real estate owned and managed, $60M under development.
Retail developer United Growth CEO Brad LaRue
says his firm has eight projects under construction and 15 in the pipeline
. The company primarily builds suburban infill, smaller single- and multi-tenant projects, and while its niche has been necessity-type retailers, he's starting to see expansion by the more disposable income
retailers, as well. United Growth is a national preferred developer for Mattress Firm
, the largest mattress retailer in the country. Typically, the developer will expand the retail chain
by building a handful of stores in a new geographic location, often purchasing land that's too large to accommodate just Mattress Firm. Contrasting the Bay Area's long and arduous entitlement process, Brad noted that in Arkansas, "If you have it in by Wednesday noon, you'll have your answer Thursday morning
Kilroy Realty VP of development Chris Heimburger
wants continued growth in the Bay Area's office market. (The REIT has acquired 5M SF
of office space here in the past three years—both stabilized space and development plans—so go figure.) Chris says most of the company's properties in the South Financial, SoMA, and Mission Street corridor areas are 100% pre-leased. "Tenants are hungry. We're seeing a climate change
" where tech tenants are now willing to pre-lease two years in advance. The crown jewel
of Kilroy's San Fran portfolio: 350 Mission
, a 27-story, fully entitled building that it closed in October, and by the end of December pre-leased all 400k SF to Salesforce.com. Chris said it'll likely become the City's first LEED Platinum
tower. The company also hopes to get 333 Brannan
fully entitled by year-end with delivery in 2015.
Charles asked whether panelists see any quality of life
challenges that might constrain plans. John notes Oakland has serious problems like crime but is confident in developing in key locations
. He just refinanced a live/work building he developed 28 years ago
in West Oakland—it's 100% leased and rents keep rising. Chris says San Francisco's access to mass transit
is among the best, and "the efforts being put into the Transbay district plan, in particular, are going to add value to living downtown
Integra Realty Resources
can celebrate Veterans Day with a little extra gusto (if it can get the floats and marching bands through the cubicles). San Francisco director Michelle van de Pol
recently hired army veteran Steve Soder
as an analyst through the VA
's On-the-Job and Apprenticeship Training program. She tells us it's an ideal fit
for the CRE industry. Steve, who got his degree after serving in Iraq
, wasn't sure what field he wanted to work in, and Michelle took notice of his broad skill set
and a maturity that you don't often get out of fresh college grads: "He's not afraid of interaction and figuring out things on your own." In fact, he figured out the GI Bill
would pay for the numerous courses necessary to become a licensed real estate appraiser.
Michelle, with son Liam
, tells us licensing requires 200 hours of course work
covering basic appraisal principles and procedures, ethics and guidelines, income capitalization, highest and best use analysis, stats and valuation modeling, to name just a few, along with 2,500 documented hours of experience
. Classes can be costly
, and she has funding for just one class per year, so it generally takes trainees five years
to be licensed. Steve's GI Bill benefits allowed him to take a greater number of classes, while garnering real-world experience
working in the IRR office. Michelle's office covers the nine-county Bay Area.
Sequestration means government spending cuts, not spending cats? Probably shouldn't have invested in that catnip factory. Julie@bisnow.com.