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October 12, 2007



Sponsor Update: Hats off to Buch Construction, which put up the new Bloomingdales, both base building and buildout. Due to the merger of Federated and May Co., what originally was planned as a Hecht's got scrubbed for a Macy's, which got revised to Bloomies. Buch was allowed to start the interior Feb '07, and finished just 6 months later.

So what illustrious board is this?  Goldman Sachs?  Brookings?  Nah, it’s just friends we invited Wednesday to hang at power restaurant 701 for some smoked salmon over apple fennel salad, poached pear with peppered caramel, and other fare the Bisnow empire dines upon daily. We’ve been going to 701 since it opened in 1990 and owner Ashok Bajaj (who also owns Bombay Club, Oval Room, and Rasika) makes it special, although you can’t tell below because we forgot to take a picture with food on the table.    

Around table from left, Fraser Forbes CEO Rich Samit, Brookfield regional chief Paul Schulman, Forrester Construction president David Forrester, Abdo kingpin Eric Price, Jair Lynch Companies founder Jair Lynch, Bisnow Empire’s Mark Bisnow, Reznick Group real estate head David Kessler, Group Goetz Architects founder Lewis Goetz, Arent Fox real estate guru Richard Nettler, Jones Lang head of leasing Dave Bevirt, MPR founder Bob Murphy, and LandAm queen Candace Chazen.

Random comments (sorry, no attribution):  Trophy commercial is still on fire in DC; A is flat but still so high it’s putting pressure on B; credit crunch turns out to be more correction than crisis:  Highly leveraged players are out, all-cash ones are in, and as a result of fewer transactions there’s less pressure on prices and rents; anticipation of Democratic victory is causing suburban defense firms to sell; urban mixed use is hot; downtown residential will benefit from new waves of government retirees and recruits. 

Yesterday we joined a full ballroom at the Press Club for DCBIA’s State of the Leasing Market. Woodmark’s Geoff Kieffer, center, said it's a tale of two cities: Owners in the CBD and East End have the leverage, whereas new product in SE and NoMa has to work hard to court tenants. Quadrangle’s Helen Haerle said the landlord’s view in four words is “rents are too low”—because of operating, insurance, construction, and purchase costs, which have risen faster over the last ten years than the 4% compound annual growth in rents.  She talked about vertical additions as an answer.  West Lane & Schlager’s Eric West  said the tenant’s view is also four words:  “Rents are too high.”  He said tenants always want location, price, and amenities, but these days can get only two.

Tuesday was a big day for ULI Washington:  their capital markets breakfast at the Grand Hyatt for over 300 and featuring Akridge’s Matt Klein, Cassidy’s Bill Collins, Walker & Dunlop’s Willy Walker, and Carlyle’s Chip Lippman; Forrester Construction’s David Forrester and developer Bob Buchanan co-chair the series. (Cliffs Notes: Loan-to-value is significantly lower, meaning fewer portfolio trades, meaning prices will moderate.  But Washington is still highly desired by investors.) Tuesday was also the day ULI got a new executive director, so we went over to meet her: Lisa Rother, second from right above. With her outside their Bethesda office: Meghan Welsch, Audrey Staples, and Sophie Lambert

Last night, our own Elliott Bisnow, left, and Skanska's Brennan McReynolds met up with Ben Affleck at Capitol File’s party at the City Tavern Club, after a pre-release screening of Gone Baby Gone. Elliott and Brennan tried talking about the Red Sox, but Ben kept demanding more detail about what happened at the ULI Capital Markets conference.


Reznick Group

Leo A Daly

Walsh Colucci

Reznick Group

Preferred Offices

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