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NAIOP Developments Newsletter - November 2012
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The Electoral College, It's a Horse Race In this issue...

The Electoral College, It's a Horse Race

NAIOP MD/DC Chapter Members Honored at Development`12

REEL Legends Breakfast with Sherry Cushman

Sustainable Development: The Path to a High Performance Portfolio

Legislative Update

Improvements to "Growth Offsets" Policy Leaves Unresolved Issues

Upcoming Events

November 8, 2012
The Evolution of Retail in Office Buildings

December 8, 2012
The Value of Green Improvements

December 14, 2012
Member - Guest Holiday Breakfast and Annual Meeting
At NAIOP's Development '12 conference, Dr. Larry Sabato delivered an in-depth and colorful look into the election and what it takes to win the presidency.

This exclusive 3-minute clip of Dr. Sabato's remarks about the electoral college at NAIOP's Development '12 conference is shared by NAIOP to keep our members in touch with the excellent content presented by keynotes at the industry's most valuable conference. [Return to top.]
NAIOP MD/DC Chapter Members Honored at Development `12
Sarah Dreyer and Andrea Hidalgo - National Development Leader Award 2012 Two NAIOP Maryland/DC chapter members were  recipients of the prestigious 2012 Developing Leaders Award, presented by NAIOP. Sarah Dreyer, Senior Analyst at Cushman & Wakefield and Andrea Hidalgo, Senior Manager at AtSite were among thirteen exemplary young professionals nationally who were honored during Development `12. The Developing Leaders Award is an annual award bestowed upon up-and-coming professionals who have distinguished themselves in their profession and show great promise as future leaders of the commercial real estate industry.
In another surprise that day for Andrea, she was rushed from the Developing Leaders Award presentation to the hospital to deliver her second child. Elise Maria Hidalgo was born on October 26, 2012, weighing 6 pounds. Elise joins big brother Mason in the Hidalgo family. NAIOP Maryland/DC congratulates the Hidalgo family on its newest addition! [Return to top.]
REEL Members Legends Breakfast with Sherry Cushman
Sherry Cushman - REEL Legends  Breakfast On September 27, 2012, REEL members joined Executive Managing Director Sherry Cushman of Cushman & Wakefield for a candid and insightful glimpse into the journey of her career in commercial real estate. The breakfast event was held at C&W’s office in Washington, D.C. Cushman, who recently joined C&W after nine years as a senior vice president at CBRE, has represented tenants throughout the country in over five million square feet of leasing and build-to-suit transactions.

Cushman started her professional career in 1985 designing interior space for law firms and made the jump to being a broker with Studley in 1993.
 “I could not fail and I would not fail,” she said when asked about her motivation level during the three years she worked before closing her first deal. For the young professionals in the audience, Cushman cited the many types of opportunities within the industry as encouragement. “It’s a fabulous business,” she said. “It takes years to learn the job, but what you learn on the ground is what’s most important.”  For the women in the audience, she pointed out that despite the small percentage of female brokers nationwide, many of them rank amongst the top-performing brokers overall. “With the right company, the right team, and the right partner, you can do it all,” she said.

The event provided Real Estate Emerging Leaders with tremendous personal insight and anecdotes from a highly accomplished industry professional. [Return to top.]
Sustainable Development: The Path to a High Performance Portfolio
Sustainable Development On October 9, 2012, NAIOP members joined the Sustainable Development Committee (SDC) for a presentation of cases and lessons in sustainability from representatives of Akridge, JBG and the Tower Companies.  The event was held at the Reznick Group office in Bethesda, MD.

Bob Schofield and Sarah Knutson of Akridge discussed the company’s approach to sustainability through bringing properties up to LEED standards.
They emphasized the importance of contracting green vendors and ensuring that they follow proper protocols. Akridge works to improve educating employees, partners and clients on the importance of sustainability.
Eileen Nacev of JBG shared how JBG performs energy audits at its properties to develop steps for decreasing energy costs without completely overhauling the properties. JBG has also found that outsourcing its utility management to ECOVA, an energy and utility management company, provides a highly efficient method for tracking the energy use of each property and for developing strategies to manage and improve energy use.

David Borchardt, the Chief Sustainability Officer for the Tower Companies discussed the company’s approach to certifying its properties to LEED standards. He also covered its use of real-time monitoring of properties to rapidly recognize, assess, and fix facility and utility issues that could lead to wasteful energy consumption.

The presenters’ companies have all made sustainability a high priority. This SDC event provided NAIOP members useful lessons in sustainability practices that can help reposition existing properties to be competitive in the current marketplace. [Return to top.]
Legislative Update
At Development `12, NAIOP Vice President of Government Affairs Aquiles Suarez highlighted NAIOP's 2013 legislative priorities in several areas:

Transportation and Infrastructure
President Obama signed a two-year, $120 billion transportation reauthorization bill into law on July 6th. The bill maintains current funding levels until September 2014. The House and Senate could not agree on a longer time frame for reauthorization. NAIOP supported items include removal of earmarks, streamlined environmental reviews, consolidation of programs, and increased state spending discretion. NAIOP will continue to advocate for a long-term transportation reauthorization that gives states and localities the needed assurance to move forward with long-term planning and projects.

The Energy Savings and Industrial Competitive Act (S.1000) was passed by the Senate Energy and Natural Resources Committee. NAIOP succeeded in removing specific federal building code requirements in the legislation, references to “net-zero” buildings, and succeeded in including a requirement that energy-efficiency targets be developed with a consideration toward economic feasibility. S.1000 has been brought up four different times as an amendment to legislation in 2012.  Sponsors will continue their efforts in 2013 to get the bill passed in the Senate. 

Tax Extenders
Tax provisions, including NAIOP priorities such as 15-year leasehold improvement depreciation and brownfields remediation expensing (“tax extenders”) expired at the end of 2011. The Senate Finance Committee passed a tax extenders bill (S. 3521) but brownfields remediation expensing was not included in the Senate bill. NAIOP is working with members of Congress to ensure brownfields remediation expensing is included in legislation moving forward.

In chapter-level legislative news, Montgomery County Council is poised to adopt major changes to the County's Subdivision Staging Policy. These changes will impact the ability of commercial subdivisions to "pass" the County's APFO. For all of the "ugly" details, contact Steve Elmendorf, Committee Chair, at 301-961-5110. [Return to top.]
Improvements to "Growth Offsets" Policy Leaves Unresolved Issues
Regulations Delayed 12 Months

by Tom Ballentine, Vice President for Policy and Government Relations

Maryland is required by the federal government to insure that the state’s Chesapeake Bay cleanup plan not only reduces pollutant loading to the Bay but will maintain those reductions over time as the state grows population and jobs. The Maryland Department of Environment (MDE) is working on a draft growth offsets policy that exceeds this mandate, requiring developers to clean up existing pollutants unrelated to the development activity in addition to any increased loads associated with their projects. The resulting 100% reduction of nutrients from development land forces growth to carry a disproportionate share of the cost and operational responsibility for reducing existing nitrogen and phosphorus. The structure of the regulation also eliminates the opportunity for development projects to generate nutrient credits by reducing existing pollutants below required levels. No other regulated sector is treated in this way.

The draft regulations have been a major point of emphasis for NAIOP during the spring and summer and were the subject of seven major meetings between industry representatives and MDE as well as smaller meetings with legislators and other leaders. NAIOP submitted two sets of detailed comments on the policy to MDE and also dedicated an hour at its September policy conference to growth offsets and related efforts by state government to create a nutrient trading market.

MDE recently announced some improvements to the state's current thinking on offsets but the industry, environmental groups and the agency are far apart on more than a dozen issues related to equity, cost and implementation. Given the seriousness of the unresolved issues, MDE has decided to delay planned release of final regulations in December of this year, instead a public workgroup will be formed to continue work on outstanding issues and a new deadline of December of 2013 has been set to issue final regulations. NAIOP members can find more information including an interactive offsets calculator on MDE’s Growth Offsets web page. For questions or further information about other issues NAIOP’s State Legislative Committee is working, please contact Tom Ballentine, NAIOP MD’s V.P. for Policy at 410-977-2053 or
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