Economic Impacts of Commercial Real Estate – 2017 Edition

The annual NAIOP Economic Impacts of Commercial Real Estate report is conducted for purposes of estimating the annual economic contribution of commercial real estate development to the U.S. economy. Highlights from the 2017 report include:

  • Commercial real estate development supported 3.3 million American jobs in 2016 (a measure of both new and existing jobs).
  • Commercial real estate development contributed $465 billion to U.S. GDP in 2016.
  • There were 410.1 million square feet of commercial real estate space built in 2016, with capacity to house 1.1 million new workers.

Read the Economic Impacts of Commercial Real Estate, 2017 Edition online, and learn more about how you can support the work of the NAIOP Research Foundation.

The full report includes detail by product type and impact on state economies.

Click here to read the report.

Trump Administration to Rewrite “Waters of the U.S.” Rule

The Trump administration will rewrite a controversial rule issued in 2016 by the Environmental Protection Agency (EPA) and the U.S. Army Corp of Engineers (Corp). The rule would have expanded the federal government’s jurisdiction over certain types of waters, including rivers, ephemeral and intermittent streams, and wetlands.

Called the “Waters of the U.S.” rule, or “WOTUS” rule, it was issued in response to Supreme Court cases mandating that federal government agencies responsible for implementing the Clean Water Act clarify the meaning of that term for purposes of jurisdiction of the law. Critics of the rule charged that the rule would have expanded EPA and Army Corps jurisdiction and control, rather than providing clarification as court rulings had intended. The WOTUS rule was opposed by farmers and land owners, among others, who oppose expanded federal control over their properties. The rule had been in limbo since the U.S. Court of Appeals for the Sixth Circuit issued a nationwide stay of the rule in 2016, temporarily nullifying the new regulation until the court considered whether the agencies had exceeded their authority granted under the Clean Water Act.

As a matter of policy, NAIOP opposes attempts to increase the authority of the federal government to regulate wetlands and believes that states have an inherit right to protect and regulate state waters without the federal government imposing additional regulations that often do little to protect waterways. NAIOP staff negotiated with EPA staff soon after issuance of the draft WOTUS rule to remove the more onerous aspects of the rule that were included when it was first proposed. As a consequence, several changes were made to ensure that the rule did not unnecessarily or unintentionally harm commercial real estate development, including the addition of a number of specific exemptions to the rule addressing our concerns.

The White House is expected to issue executive orders this week directing EPA and the Corp to rewrite the WOTUS rule. Last week the Senate confirmed Scott Pruitt, President Trump’s nominee to head the EPA. As attorney general in Oklahoma, Pruitt had joined several other state attorney generals in challenging EPA’s WOTUS rule in court.

Register Now: Member-only Webinar with Dotzour and Harris on What’s Next for Industrial

The NAIOP Advantage Series is an exclusive member benefit, delivering expert insights into the latest research to help you make informed business decisions. Not a NAIOP member? Learn more about how NAIOP membership connects you with people, knowledge and education to help you stay ahead of the curve.

NAIOP Advantage Series Webinar
What’s Next for the Dynamic Industrial Market?
March 14, 2017 | 2–3 p.m. ET
Register online.

Whether you are developing, investing or brokering industrial real estate, you know the product has been hot and continues to expand. E-commerce, last mile delivery, two-story urban distribution centers and more continue to shape all aspects of the multifaceted industrial market.

Get the inside track on upcoming opportunities in the sector with Dr. Josh Harris of the University of Central Florida and well-known industry economist Dr. Mark Dotzour. Together, they will provide insights and data from the new NAIOP Industrial Space Demand Forecast, identify linkages between overall economic activity and the demand for industrial real estate, and engage in a live Q&A session with attendees.

Mark Dotzour

Dr. Mark Dotzour
Real Estate Economist
Dallas, Texas

Joshua Harris

Dr. Josh Harris
Director, Dr. P. Phillips Institute for Research and Education in Real Estate
University of Central Florida
Orlando, Florida

 

Don’t miss this unique opportunity to stay ahead of the competition. Space is limited, so register today.

Commercial Real Estate’s Contribution to the NC Economy

Commercial real estate development in North Carolina is a powerful economic engine, creating jobs and generating significant fiscal contributions to local, state and national economies.

Too Much Parking at the Train Station?

Communities with mass transit are eager to get people out of their cars and on to trains and buses. But how much parking is needed at transit-oriented developments (TODs)? If there aren’t enough spaces, frustrated commuters will end up driving to their destination. But too much parking takes up valuable space, crowding out potential housing and shopping.

A new study, “Empty Spaces: Real Parking Needs at Five TODs” published by Smart Growth America, suggests communities are setting aside too much space for parking.

A team from the University of Utah studied TODs serving Denver, Los Angeles, Oakland, Seattle and Washington, D.C. Their report finds that such facilities need far less parking than the Institute of Transportation Engineers’ Trip Generation and Parking Generation guide recommends. In TOD lots studied, “the ratio of demand to actual supply was between 58 and 84 percent,” the report finds, suggesting there were always plenty of spaces open.

One reason, the experts suggest, is that at least a third of those using each transit station arrived without their own car. That makes sense, as the idea behind TODs is to encourage people to travel without their own automobiles.

“It is clear that TODs require less parking than development without transit, or transit without development,” the report notes, which may help developers make better decisions about parking.

Automation to Change the Face of Work

The office of the future will have fewer workers and more robots, according to the report “A Future That Works: Automation, Employment and Productivity” from McKinsey Global Institute.

Not every job will change. But McKinsey writes that, “about half the activities people are paid almost $15 trillion in wages to do in the global economy have the potential to be automated by adapting currently demonstrated technology.”

The report says people will still be needed, but the nature of their jobs will change as they work with machines. “Our scenarios suggest that half of today’s work activities could be automated by 2055, but this could happen up to 20 years earlier or later depending on the various factors, in addition to other wider economic conditions.”

However, the report concludes that the changes could open new opportunities for workers.

“The anticipated shift in the activities in the labor force is of a similar order of magnitude as the long-term shift away from agriculture and decreases in manufacturing share of employment in the United States, both of which were accompanied by the creation of new types of work not foreseen at the time.”

Fine-tuning the Open Plan Office

By Bill LaPatra

Traditional office users continue to adopt and adapt trends pioneered by tech companies.

TECH COMPANIES have invested heavily in creating dynamic, exciting workplaces.  One of the fundamental challenges that architects working with these firms face is how to support the intense focus that software/systems engineers need to get their work done within an open office, while still encouraging collaboration, brainstorming and rejuvenating breaks. Various solutions to this design problem are now being adopted by more traditional companies and adapted to their own needs.

Islands of Personal Space

Most tech companies now occupy primarily open plan offices. For example, at one new office space for a large tech company (which prefers to remain unnamed), approximately 20 percent of the floor area is devoted to shared offices that accommodate four to six people. A few are occupied by executive leadership, but most enclosed spaces are private “huddle rooms” for project teams. Alternative workspaces — a library, a lounge and even a “secret room” that features a soundscape — entice people to take breaks from their workstations when they need intense focus, collaboration or social time.

Click here to continue reading.