Washington DC January 2021 Key Take Aways

• Derek Ford with WDCEP discussed the DC Mayor and Office of the Deputy Mayor for Planning and Economic Development’s launch of ‘The Bridge Fund,’ a $100 million investment in businesses and workers struggling with COVID-19 issues. The fund is devised to assist small business with maintaining operations and employees. The fund will be allocated as follows:
o $35 million to restaurants
o $15 million to retail industry
o $20 million to entertainment industry
o $30 million to hotel industry
• DC Mayor extended the ban on indoor dining until January 26th.
• Derek also stated that even with the indoor dining ban, restaurants are still looking to move into the area, and some are hiring.
• Keith Switzer and Meredith Goldberg with Intec Group indicated that from a market standpoint, office is dead, zero opportunity. Pre-Covid they were doing a test fit every 2 – 3 days and since Covid, they have done 2 or 3 in 9 months.
• Private Christian based schools are going ‘gangbusters’ as well as child daycares. Seeing a huge shift in the workload for private schools. Seeing a slow down on capital spending on repositioning.
• Keith stated that pharmaceutical and life sciences is keeping them very busy.
• Meredith has been conducting quite a bit of research and work on ‘how do we return to the office.” Everyone is starting to feel the pain from being part from each other. Bottom line is we are going back, and most are anxiously awaiting the ability to come back safely.
• Rick Schneider has not seen any legislation to provide tax incentives directly for COVID but has been doing a great deal of work in addressing essential changes made and providing R & D credit for the money being spent by businesses. There is opportunity to landlords to take advantage of credits current out there.
• Brian Boland with Phillips Realty Capital said that residential has taken off during the pandemic, seeing a lot of multi-family getting done but not much office right now, industrial is hot and retail is still challenging unless there is an anchor grocery.
• Brian has a small shopping center in Williamsburg, 40,000 SF should close with 3.5% interest on 10-year partial recourse, with a small credit union. In 2008 – 2010, credit unions were the go-to group when banks were on the sidelines, credit unions had a banner year for 2020 and a very full pipeline for 2021. Lifeco’s are being very conservative, but are taking a hard look, although there is a challenge with terms.
• KLNB reported that that they had some areas down – retail taking the biggest hit but did way better than was anticipated. They did some recruiting during this time and brought in some young hungry people, who are getting to see the market at the worst of times.
• Marc Tasker indicated that industrial continues to do well and was able to finally close the Amazon deal in Springfield – 371,000 SF.
• Brian Ball said people are not touring office space at all, however, if you are out looking for space there are some wonderful opportunities. Tenants could get up a year free rent, turnkey turnout and costs paid – it’s a great time to a tenant if the credit is okay.
• Rick Schneider and Larry Kline with Cherry Bekaert said that with the change in Administration, tax changes may take place quicker than we had initially anticipated.
• The employee retention credit, a payroll tax credit provides and immediate credit towards quarterly taxes. They are looking back to see if their clients can take this credit to assist them in keeping people employed and keeping the doors open.
• Cherry Bekaert’s revenue was a little behind for the year but not as bad as anticipated, at the same time they are expanding and adding advisory practices, they have added 15 -20 people at least.
• They are continuing to struggle with strategies to bring people back to the office – culture aspect is foremost in their minds and they feel they are losing younger folks. Hard to build culture in the new folks when they are entirely virtual.