The Bisnow Weekender: So, Where Is CRE On Diversity?

Thanks for reading the Bisnow Weekender, my personally curated roundup of the most impactful news, notable quotes, binge-worthy show recommendations and other colorful highlights from the Bisnow world of commercial real estate and beyond. 

Money and power dominate this industry. 

And to this day, that multitrillion-dollar influence, which virtually and physically touches every person walking the Earth, primarily rests with white men.

The industry, to its credit, has been doing the work over the last few years to diversify its ranks. The progress has been incremental, but the fact remains that there are more women and people of color in the C-suite than ever before.

Those are the findings of this year’s installment of Bisnow’s DEI Data Series, a multiyear investigative project started in 2020 to amass statistics on the diversity of the boards and executive leadership of the biggest companies in real estate.

But progress could be in peril.

Blame the economy, blame interest rates, blame the uptick in layoffs, bankruptcies and foreclosures. The existential crises the commercial real estate industry now faces are real, and choices have to be made — choices to survive that might include cutting “nice-to-haves.” 

Longtime real estate diversity advocates told Bisnow they fear diversity, equity and inclusion may fall into that bucket.

Katie Schwarting, a partner at law firm Seyfarth Shaw and the member chair of the governance and best practices subcommittee of the CRE Finance Council, told Bisnow that diversity is more than just doing the right thing — it makes economic sense.

“Diversity isn't something that should just be sidelined or checked off. It's something that will actually make your business richer, will create new opportunities,” she said.

Bisnow reporters have spent months collecting data, analyzing it and interviewing dozens of real estate professionals from brokerages, development firms, financial institutions and REITs. Part 2 of Bisnow’s 2023 DEI Data Series can be found here, and you can read all four years of the team’s findings here.

— Mark F. Bonner, Bisnow Editor-in-Chief

Voices From The CRE Battlefield

“The commitment is waning and fizzling away. I do feel more optimistic that there are people behind me, but certainly not enough.” 

— Savills Vice Chairman Ernie Jarvis, regarding the state of CRE’s push to diversify its ranks. While the leadership ranks at the industry's largest firms have never been so diverse, progress remains uneven — and real estate executives who spoke to Bisnow said they fear the deeply troubled real estate market will hinder further advancements. 

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“Everybody is waiting for somebody else. It’s like a middle school dance. You have to wait for one person to get brave enough to cross the floor.”

— CRE Recruiting founder Allison Weiss, to Bisnow National Reporter Patrick Sisson, on the stalemate between job seekers and employers as they ride an uncertain commercial real estate market. RCLCO’s annual compensation survey found that 85% of companies reported trouble hiring skilled talent.

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“At the end of the day, we're all really just prisoners to the next data release, including the Federal Reserve.” 

— Xander Snyder, senior commercial real estate economist at First American Financial Corp., to Bisnow Houston reporter Maddy McCarty regarding the unpredictability of when interest rates will eventually drop. 

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“I'm always skeptical when I hear on CNBC about dry powder or money on the sidelines or anything like that. It doesn't matter if there's a bunch of money on the sidelines if it's staying on the sidelines, right?”

— Archway Capital Chief Operating Officer Tom Noble, at Bisnow's Multifamily Annual Conference West in Los Angeles.

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“As a long-term investor, you have to think about the cost of doing nothing, and you have to consider the risk of obsolescence by not making investments long-term.”

— Norges Bank Investment Management Senior Manager and Global Sustainability Lead Nina Galbiati, at Bisnow’s UK ESG Real Estate Agenda event. With interest rates rising and building values dropping, real estate owners might be tempted to scrimp on investing to make their buildings more sustainable. But according to the world’s largest sovereign wealth fund, they’d be wrong. 

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“It just shouldn’t be this hard. For those of us who are toiling away, trying to do the right thing, trying to produce and preserve, it shouldn't be hard for us to do that. It should be really easy.”

— Asland Capital Partners CEO James Simmons, at Bisnow’s New York State of the Market event. He was referring to rising interest rates and inflation, combined with a lack of government incentives, that have brought the commercial real estate sector in the nation's largest city to a crawl.

Word Up, CRE …

Bona Vacantia

It’s a legal term for property that has no clear owner. It can also be referred to as “ownerless goods” or “vacant goods.” The term has origins in English law, and it applies to property that has been “abandoned, forgotten or mislaid.” It can also apply to the estate of someone who dies without a will or known heirs. In these cases, the estate is considered bona vacantia, and if the person lived in a certain part of northwest England, it passes to the Crown — that is, King Charles III.

According to news reports out of the UK this week, an estate whose profits flow to King Charles III apparently has been using assets collected from dead citizens who had no will or known relatives to upgrade the crown’s commercial property portfolio.

Bisnow News Excerpts: Nov. 27-Dec. 1

SPECIAL REPORT: Diversity In CRE Is Rising, But The Industry's Troubles Threaten Progress — Emily Wishingrad, Matt Wasielewski, Olivia Lueckemeyer, Bianca Barragán, Ethan Rothstein, Miriam Hall and Katharine Carlon

The year 2023 will be remembered by real estate for many things — a rise in layoffs, bankruptcies and foreclosures, and a decline in property values and transactions.

But despite the grim reality of the moment, the leadership ranks at the industry's largest firms have never been so diverse.

People of color make up 12.8% of the C-suites at 89 of commercial real estate's largest brokerages, developers, finance firms and real estate investment trusts, up from 11.6% in 2022 and 10.9% in 2021. Women in the C-suite have seen their representation increase to 26.2% this year from 25.6% in 2022 and 23.5% in 2021. Read more.

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Uncertain CRE Job Market ‘Like A Middle School Dance’ — And No One Is Making The First Move — Bisnow National Reporter Patrick Sisson

After big brokerage firms laid off hundreds in the last year to stem the tide of dwindling revenue, 2024 was expected to be a rebound year for commercial real estate hiring. Not anymore.  

Gripped by uncertainty about the state of financing and real estate transactions, job seekers and employers in CRE are eyeing each other but are unwilling to commit, according to industry analysts and top headhunters. Read more.

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Office Landlords Increasing Pace Of Handing Properties Back To Lenders — Bisnow South Florida Reporter Matt Wasielewski

Office buildings made up 43% of all deed-in-lieu-of-foreclosure transactions in the second quarter, according to a CoStar analysis of the most recent data available. The share of office buildings voluntarily surrendered to lenders is more than double the 20% average across 2022 and outpaces the volume seen before the pandemic. Read more.

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Shoppers Are Pumped Up For The Holidays. After That, All Bets Are Off — Bisnow National Reporter Dees Stribling 

“Retailers are cautiously optimistic since there has been a slowdown of inflation, and a lot of the supply chain issues have been worked out,” said Babson College professor of marketing Lauren Beitelspacher, a specialist on holiday shopping and other aspects of retail sales.

That doesn't mean consumers are similarly optimistic, however, and that will probably pose new challenges for retailers once the holidays are over. Read more.

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More News From The Week …

• ‘Prisoners To The Next Data Release’: Economists Say Interest Rates Likely To Drop In 2024, But Probably No Time Soon

• Spurred By Deals, Shoppers Set A Pandemic-Era Record Over Thanksgiving Weekend

• EXCLUSIVE: HUD Vacating Atlanta Tower, Leaving Landlord Looking To Sell

• Cold Storage Giant Looks To Go Public At $30B Valuation

• With Hundreds Of Closures Coming, Drugstores Can't Find The Cure For What Ails Them

• Where Inexperienced Multifamily Investors Rushed In, 'Generational Opportunities' Await

• 'Author Of The Future Or A Victim': Architects And Designers Face A Choice As Projects Nose-Dive

• PODCAST: Asland Capital CEO James Simmons On Building Complex, Diverse Capital Stacks

My Slightly On/Off-Topic Media Diet

The Envy Office: Can Instagrammable Design Lure Young Workers Back? (NYT): “It’s what might be called the Envy Office — what happens when companies try to combine the comforts of a living room and the glamour of a vacation. These spaces — often characterized by colorful walls, upholstered furniture and carefully curated coffee table books — lure workers in with plenty of opportunities to fill their social feeds with photos taken at the workplace.” Haven’t we been here before? Remember office dogs, beanbag chair conference rooms and all-you-can-drink cold brew, kombucha and craft beer? We still have those amenities. Meanwhile, office building owners are increasingly tossing the keys back to lenders instead of fighting to hold on to them. 

Is The American Dream Really Dead? (FT): “The American dream, a term first used by a Depression-era historian named James Truslow Adams, is all about upward mobility. Any US citizen, if they work hard, should be able to not only succeed, but rise above the station of their parents … but things have changed in America. There is no longer a mass movement focused on improving economic outcomes for most Americans.”

Meet Laura Dekker, The Youngest Person To Sail Solo Around the World (The Profile): “So at age 14, Dekker began her 518-day journey around the world. She began in August 2010 and finished in January 2012. In that period, she took on massive waves, extreme weather, dangerous reefs, cramped living conditions, and total solitude. But she gained something too — self-confidence.” What were you doing at 14? I was trying to convince my parents to buy me these. (Never happened, by the way.)

'Oh, Oh, Oh, Ozempic': The Story Behind The Song (Ozempic): “Well, here I am back singing the song I recorded 50 years ago. Doesn’t matter that I am singing a different lyric. It’s the same feeling of excitement when I am singing it, when I am playing it — it’s exactly the same.” The Ozempic Song is based on a real pop hit, Magic, that was released in 1975 by a Scottish pop-rock act called Pilot. The song became a gold record that topped the charts. It shocks me that the band’s lead singer, David Paton, gets the “same feeling” with Ozempic as he did during this bell-bottomed performance. Indeed, that takes magic — or maybe a little bit of money.  

Mark Bonner’s Spotify Wrapped: Well, it’s that time of year again, when Spotify unleashes its year-end stats on all of our listening habits. I got mine this week and wanted to share some stats: I listened to 55,379 minutes of music (that’s 38 days straight, and at points this year I was a top 4% listener in the world) — 6,792 different songs across 123 genres. I may be a New Yorker, but my musical spirit animal apparently aligns most closely with Santa Cruz, California — never been, but apparently they also like Aphex Twin, Nine Inch Nails and The Smashing Pumpkins. 

My most played song of the year is The Cure’s Pictures of You — while my other top songs include Metallica’s new single, If Darkness Had A Son (got me through the Brooklyn Half Marathon), and an old doom metal favorite called Gravity Chasm from Conan (who I saw this year at the famed St. Vitus Bar in Brooklyn). My artist of the year is Tool (The Pot is a favorite), whom I will be seeing again at Madison Square Garden in 2024.

While my main genres were rock, jazz, classical, electronica and neo-psychedelic, my heart and ears are obviously still stuck in the 1990s. 

Bisnow Weekend Interview Preview

This week, Bisnow Chicago Reporter Ryan Wangman sat down with J. Byron Brazier, who said he believes real estate can change the world — and he wants to do just that to his own corner of Chicago’s South Side.

Brazier, an artist-turned-entrepreneur, is the lead developer for Woodlawn Central, an $895M mixed-use project spanning 8 acres of church-owned land in Chicago’s Woodlawn neighborhood. The plan aims to create a hub of Black life, culture and entertainment and will feature a technology center, a hotel, commercial business spaces, a theater and private residential buildings.

Bisnow: What inspired you to take charge of this massive undertaking of a development?

Brazier: I've always been a philanthropist at heart. So helping people or supporting people is really a key instrument into my development pathway. Our communities do lack some cultural DNA compared to other ecologies like Chinatown, Ukrainian Village and Little Italy. There's a cohesion, there's a ubiquity within those communities that I really wanted to have in my own community. That's really the inspiration into moving into these pieces of development. 

The Weekend Interview goes live every Friday evening — head to www.bisnow.com over the weekend to check it out!

Jobs! Jobs! Jobs!

Here are this week’s top jobs over at our careers platform, SelectLeaders. Reach out to SelectLeaders Managing Director Ryan Neale to learn more. You can email him at ryan.neale@bisnow.com.

VP of Acquisitions and Asset Management — Lead acquisitions and asset management for a premier Southeast owner/operator.

Head of Property Management — Lead property management for a $7B portfolio.

Managing Director of Investor Services — Be responsible for integrating and coordinating all real estate services for a large institutional firm.

President/CEO — Manage complex real estate and finance deals along with an extensive array of incentive programs.

Upcoming Bisnow Events And Webinars

Tuesday, Dec. 5 (Atlanta): Atlanta 2024 CRE Forecast

Tuesday, Dec. 5 (Fairfax, Virginia): The Future Of Fairfax County

Tuesday, Dec. 5 (West Palm Beach, Florida): Palm Beach State Of The Market

Tuesday, Dec. 5 (Boston): Boston Biotech Summit

Tuesday, Dec. 5 (McKinney, Texas): State Of The Collin County Market

Tuesday, Dec. 5 (Chicago): Chicago Hospitality Summit

Tuesday, Dec. 5 (Seattle): BMAC Pacific Northwest

Tuesday, Dec. 5 (Los Angeles): Southern California Women Leading Real Estate

Wednesday, Dec. 6 (Austin): Austin State Of The Market

Wednesday, Dec. 6 (Webinar): State Of The Pacific Northwest Data Center Market

Wednesday, Dec. 6 (Webinar): Smart Spaces: Unlocking The Future Of The Workplace

Thursday, Dec. 7 (Boston): Greater Boston Affordable Housing Summit

Thursday, Dec. 7 (London): UK Life Sciences Winter Forecast

Thursday, Dec. 7 (Houston): Houston Women Leading Real Estate

Hey, Emily, What Are You Going To Binge This Weekend?

I’m watching Sex and the City for the first time ever. I feel like I’ve missed a major cultural touchstone with this one, so I’m making it my priority to get caught up very quickly. I enjoy sometimes finding myself in Carrie Bradshaw’s shoes (if only literally, right?) — like in the moments she runs out for another cup of coffee 30 minutes before her deadline. 

On the opposite end of the spectrum, I would also typically watch Shark Tank as a Saturday morning ritual, but alas, football programming (Oregon is playing Washington for the Pac-12 championship) is replacing that pleasure this week on ABC. Tuesday’s news that Mark Cuban is leaving the show after 12 years is something I won’t recover from anytime soon. — Emily Wishingrad, Bisnow Washington, D.C., Reporter

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How did I do? You can send all love letters and dissents directly to me at mark.bonner@bisnow.com. 

CORRECTION, DEC. 1, 2023, 2:15 P.M. ET: A previous version of this article misspelled J. Byron Brazier. This article has been updated.