7/22/21 Richmond Mastermind Meeting

Richmond July 2021 – Key Take Aways 

• Mike Cobb with CoStar Group said that the latest release of econ data for the Richmond area showed the loftiest month of job gain since last July, 8500 jobs were added month over month.  Record setting levels of sublet space, close to 1.5M SF is starting to place some pressure on rents.  The concerning issue of this is that about 2/3 of that space have terms that do not expire for more than 3 years, so this is not going to be a short-term issue.  (Mike Cobb, CoStar Group)
• Kevin Krause with Ten-X Commercial Real Estate says that in Q2, 211 properties valued at $797M sold.  Hotels are moving well, and multi-family is flying off the shelves.
• Tom Rosman with One South Commercial has been working away on some small multi-family.  The market has been very strong, pricing does not seem to matter.  He has a fair amount of small development deals with 7 or 8 under contract.  Optimistic about the market coming up as he is getting better reception when calling on people to sell.
• Justin Sledd with One South Commercial says he believes that some of the velocity in work is related to 1031 exchanges.  He has seen a good amount of them come through the door and believes that people are having a knee jerk reaction to the possibility of 1031 exchanges going away, however, he would be surprised if that actually occurred.
• Charlie Kreye with Draper Aden has seen consistent growth over the year.  Seeing a lot more entitlement and environmental work with brownfield funding ramping up.  A lot of money is being spent on distressed properties.  There is a ton of data work as well as interest in data in the region.  The state is starting to spend money again and higher ed is starting to break loose as well.
• Maynard Grizzard with Whiting-Turner says that it looks like Wegmans might finally get started!  Working a pretty large multi-family job but pricing and delivery volatility is still a problem.  He is seeing a lot of upfront work and he is hopeful that will turn into future projects.
• Chuck Wray with Quinn Evans is encouraged by the unprecedented amounts of proposals as flood gates open; their marketing team is jammed up!  Federal government work is strong.  The office is going back to in-person in September with a 3-2 schedule.
• John Jobe with Cherry Bekaert says that they are flipping the switch and going back to the office on August 1^st.  They are preaching flexibility and not mandating.  The Tax Practice group wants people in the office 3 days a week, as opposed to the Audit side being a little more flexible.  They are re-evaluating their footprint space and trying to determine what things are going to look like.
• Stuart Brodsky with NYU gave an informational presentation on the growth and formalization of ESG (Environmental, Social, Governance) criteria and tools used by the professional asset management industry.  RE developers and operators are increasingly encouraged to adopt ESG protocols.  Real Estate can play a particular role in the “E”, environmental side, through energy efficiency:  ENERGY STAR and Better Buildings.