ICSC RECON 2013 UPDATE – Things Are Happening Now!

May 20, 2013. ICSC RECON UPDATE. Today was an exhausting but productive day. My Fitbit recorded nearly 20,000 steps, or roughly 8.75 miles covered. My feet hurt, so I believe it.

It was great to see friendly, familiar faces, from past and present – happy to be making deals again.  There is, for the first time in a very long time, an upbeat mood in the CRE industry, and an abundance of new construction and redevelopment projects underway.

I was interested to hear what community development directors from communities around the country had to say. To a large extent they are “open for business”, fully expecting to hear from developers seeking development incentives, and prepared to be of assistance.

Interestingly, some communities question whether development incentives should be necessary with development coming back. . . To which I have to respond: Really?

My reminder to communities is that

we have at least regional CRE markets, if not national CRE investment options. Many cities, towns and villages are trying to induce developers to come to their communities. New development means jobs, capital improvement, vitality, tax revenue (eventually, if not immediately), removal of blight, and building of community pride and a sense of prosperity. If one community doesn’t make clear it is willing to incentivize developers to build within its borders, a neighboring community will.

Beyond direct economic incentives to developers are more basic incentives like a willingness to adapt zoning requirements and bulk restrictions, expedite development approvals and issue building permits without undue delay. If a community is not willing to facilitate economic development it should not be surprised when economic development passes it by and heads to other communities.

Fortunately, there are a large number of sophisticated community development professionals who “get it” and are prepared to welcome developers with attractive economic development incentives. That is good news. And, in part, because of that good news, construction cranes are rising and earth movers are moving. There is still a long way to go to get back to an entirely healthy CRE market, but the patient is finally responding and the prognosis looks good. Some developers and lenders still have difficult problems that need to be worked through, but my recommendation is: work diligently to put those issues behind you as quickly as practical. A new day is about to dawn.

I am pleased to report from my own practice experience over the past several months, and from indications on the Leasing Mall floor at ICSC RECON 2013, things truly are beginning to look brighter for the CRE industry. Position yourselves. Use common sense, and exercise due diligence. There are opportunities sprouting everywhere.

Thanks for listening.
Kymn