As published in Scotsman Guide's Commercial Edition, October 2007.
Commercial real estate spending added $498 billion to the U.S. gross domestic product in 2005, according to a recent NAIOP study. This is a good thing, NAIOP contends -- pointing to development's impact on the economy. Its chairman, Michael Mullen, tells us more.
Why should brokers encourage their developer clients to be involved in an organization like NAIOP? In addition to being a networking opportunity, it's a great opportunity for trend-spotting. Through our education, conferences and legislative efforts, NAIOP gives members a cutting-edge advantage to find out how people are addressing problems elsewhere in the country and to be a step ahead of the game.
More than 2,000 new members have joined NAIOP this year, bringing membership to more than 16,000. Why this growth? We're expanding our reach to include more young people, more people from diverse backgrounds and more women. The response has been overwhelming. It is also a sign of the health of the industry in general. The [office and industrial development] business is healthy, and people are hiring again.
A primary goal of NAIOP's Vision 2007 plan is to ensure that the commercial real estate industry thrives. The association sees mixed-use growth and international-development awareness as important drivers of this. Why? We've entered into a mixed-use world, partially because of the anti-growth sentiment in some communities. People are building back into inner cities and finding new uses for outdated facilities. It's also driven by people wanting to work, live and eat in the same areas.
In terms of international development, our members realize that the U.S. has become less a manufacturer and more an importer of foreign goods. So our rail and infrastructure systems need updating for ports to handle this explosive import growth. The advent of infrastructure funds to invest in ports as well as [in] intermodal and rail-related facilities will affect how we do business [and] how we design buildings, and it will affect what markets will be hot.
Another part of the vision plan is to be active in supporting sustainable, "green" development. How is NAIOP doing this? It has become relatively easy for office-developers to build green without huge additional costs. But it can mean huge premiums for industrial developers, primarily because of the size of industrial buildings. It's almost a rare breed of company that can absorb the financial hit.
Our industrial members want to build sustainably, so we've created our own task force to come up with logical ways to be green and still make it affordable.
Regarding the industrial arena, what would you like to see happen with brownfield legislation? Again, given the focus in development in inner cities and older suburbs, municipalities are begging for a cohesive Environmental Protection Agency policy to promote redevelopment. I would like to see pro-redevelopment brownfield tax credits at the national level.
Melinda Young is an associate editor at Scotsman Guide. Reach her at (800) 297-6061 or email@example.com.