NAIOP Source Updates 7/28

IRS Proposes Carried Interest Changes

Last week, the U.S. Department of the Treasury and the Internal Revenue Service issued a proposed regulation that could affect whether partnership “carried interests” are taxed at capital gains rates or at much higher ordinary income rates. Read More


 

Shipping Containers DIY: Creative Uses

Find out what the latest Market Share blog posts reveal about new uses for shipping containers, examples of Washington, D.C.’s condo market going industrial chic, and why Section 1031 Like-Kind Exchanges are integral to real estate investments. Read More


 

Biggest US Industrial Boom Ever

The U.S. industrial sector is experiencing its greatest boom ever, according to DTZ’s “U.S. Industrial Trends Report” for the second quarter of 2015. Read More


 

Top 10 Life Sciences Markets

Boston, Raleigh-Durham and San Francisco currently lead the pack in JLL’s latest rankings of life sciences clusters. Read More

IRS Proposes Carried Interest Changes

Last week, the U.S. Department of the Treasury and the Internal Revenue Service issued a proposed regulation that could affect whether partnership “carried interests” are taxed at capital gains rates or at much higher ordinary income rates. The proposed regulation, titled Disguised Payments for Services, is aimed at clarifying when compensation received by partners is more in the nature of guaranteed income, or salary, and therefore more appropriately taxed as ordinary income.

NAIOP has opposed legislative proposals that would subject all carried interests (also known as “promotes” or “promoted interests”), which are currently taxed as capital gains, to much higher ordinary income tax rates, regardless of the underlying nature of the investment. In most cases, real estate partnership carried interests are not guaranteed, and in fact are dependent on the eventual success of the enterprise. As a result, they represent entrepreneurial risk that is more appropriately treated as capital gains.

Public comments to the IRS proposed regulation are due October 21, 2015. NAIOP and its industry allies will be analyzing the impact of the regulation and providing substantial input to the IRS and Treasury Department.

Governer Signs Legislation to End Use of Rezoning Protest Petitions

On July 23, Governor Pat McCrory signed into law HB 201, ‘Zoning Changes/Citizen Input’, which repeals the North Carolina Protest Petition statute and eliminates a tool frequently used by neighborhood groups to force concessions from property owners and developers. The law will be effective for any rezoning petitions filed August 1st or later.

HB 201 eliminates a longstanding state law allowing neighbors in the immediate vicinity of a proposed development to force the applicant to secure a supermajority of affirmative votes from the city or town council for rezoning approval (that’s a 75% vote on a rezoning). If as few as 5 percent of the neighbors within 100′ of the property line sign and submit a valid Protest Petition to the local planning department, they can obtain enough leverage to force financial or design concessions from the property owner or developer that would otherwise be difficult if just a simple majority vote were required for the rezoning.  No other action taken by local government action requires a supermajority vote.

The NAIOP Chapters of North Carolina actively participated with North Carolina Home Builders Association (NCHBA), Apartment Association of North Carolina, Charlotte Commercial Board of Realtors® and REBIC, to pass this legislation. We actively delivered letters about our position, spoke in front of legislative committees, held individual meetings with key legislators and walked the halls of the General Assembly to hand deliver NAIOPs position on the matter and request support. In Charlotte, a special thanks goes to Chris Thomas (Childress Klein) and Joe Padilla (REBIC) for their hard work. This is a HUGE VICTORY for the real estate industry in North Carolina!

CREW Charlotte’s 9th Annual Casino Night

CREW Charlotte’s 9th Annual Casino Night
September 2, 2015
5:30pm – 9:30pm
The Charlotte Country Club

Join CREW Charlotte for their 9th Annual Casino Night! Click here to view the flyer.

Casino Night Ticket – $100
Ticket includes $20,000 Play Money Voucher, 2 Drink Tickets, and Hors d’oeuvres.

High Roller Ticket – $125
(Limited number available, sold online only)
Ticket includes $60,000 Play Money Voucher, High Roller Badge, and 3 Drink Tickets.

Click here to register!

Commercial Real Estate Conference 2015 – NAIOP Goes to Toronto

NAIOP Commercial Real Estate Conference 2015

Deals. Connections. Trends.

October 13-15 , 2015
Fairmont Royal York Hotel | Toronto, Ontario

NAIOP is reinventing the real estate industry’s premier event.

Convening innovators and visionaries from the top of the industry: 45% President, Partner, Principal, CEO and other C-suite | 54% Senior Management

1,000+ of North America’s best Real Estate talent.

Toronto is NAIOP’s second largest chapter and Canada’s fastest-growing and most populous city.

Hear from political leaders shaping the nations, foreign policy experts and how the U.S. and Canada do business.

Expand your network with new connections.

Be there! Register at naiop.org/crecon15

Call to Action!

Economic Development Incentives
Do They Really Help Recruit Business?
CALL TO ACTION

With more than 165 registrants at the NAIOP Charlotte breakfast this morning (July 23) the general consensus to the question was YES, Economic Incentives are an important tool for recruiting business to our area. Our speakers emphasized the state legislators need to hear from business leaders about these issues.

Who to Call

President Pro-Tem Phil Berger; (919) 733-5708; Phil.Berger@ncleg.net
Majority Leader Harry Brown; (919) 715-3034; Harry.Brown@ncleg.net
Finance Co-Chair Bill Rabon; (919) 733-5963; Bill.Rabon@ncleg.net
Rules Committee Chair Senator Tom Apodaca; (919) 733-5745; Tom.Apodaca@ncleg.net
Senator Jeff Tarte (Mecklenburg County); (919) 715-3050; Jeff.Tarte@ncleg.net
Senator Tommy Tucker (Union County); (919) 733-7659; Tommy.Tucker@ncleg.net
Senator Bob Rucho (Mecklenburg County); (919) 733-5655; Bob.Rucho@ncleg.net

What to Tell Them

NAIOP Charlotte has met with state legislators and sent a letter in March detailing our support of the House Job Incentives Bill (HB117). Additionally, NAIOP will be issuing a statement next week about the detriment of the sales tax redistribution proposed by the Senate. The key points to tell the state legislators when you call include:

  • Job creation and economic development in North Carolina is dependent on our state’s ability to compete in the arena of economic incentives. We ask you to SUPPORT an uncapped JDIG program in the 2015 Appropriations Act, to allow the Commerce Department to negotiate successfully with companies seeking to bring new jobs and tax revenue to North Carolina.
  • Without an uncapped and aggressive JDIG program, you risk losing out on opportunities to bring economic development to your communities, and jobs to your constituents.
  • While state economic incentives aren’t always the deciding factor for a company seeking to relocate, the existence of a strong incentives program is a box that must be checked if North Carolina is to remain in the game.
  • It is also essential that you OPPOSE the language in the Appropriations bill that would redistribute 80 percent of locally collected sales taxes statewide on a per-capita basis. This proposal would cost Mecklenburg County at least $213 million over the next four years necessitating a significant increase in property taxes to pay for the public infrastructure and services demanded by North Carolina’s largest economic engine.
  • Sales taxes are a critical source of revenue for fast-growing counties like Mecklenburg, Wake and Guilford. Instead of redistributing this much-needed revenue, the General Assembly can help North Carolina’s rural counties by allowing our state to compete effectively for new economic development with an uncapped JDIG program.

When to Call

Now is the time for action. Legislators need to hear from our industry and their constituents. Some take a tally of support/opposition on issues and vote according to who they have heard from. Your voice is important.

NAIOP Charlotte, along with NAIOP Raleigh Durham and NAIOP Triad, will continue to represent the industry’s views in commercial real estate, but you can make a difference by participating in this call to action.

Resources

NAIOP Source Updates 7/21

House Passes Short-Term Transportation Extension

The House of Representatives recently passed a short-term extension of the highway and transit bill, just two days after the legislation was officially introduced. Its quick passage highlights the urgency of the problem, as authorization of the current transportation program is scheduled to expire on July 31. Read More


 

The Ultimate in Niche Development: Senior Living for NFL Players

Catch up on recent Market Share blog posts to uncover the leading U.S. markets for green commercial real estate and to learn how a new partnership aims to provide senior living services for a niche group: former NFL players. Read More


 

The Outlook for East Coast Ports

A surge in activity at East Coast ports may come more from disruptions at West Coast ports than from the Panama Canal expansion. Read More


 

Cyberrisk Management and CRE

Many commercial real estate companies are inadequately prepared for cyberattacks, according to a new Deloitte report. Read More