The record-setting 2008 BOMA International Conference and The Office Building Show, which was held June 22-24 in Denver, attracted nearly 5,000 participants from around the country and overseas for three days of world-class speakers, premier education, information sharing and a showcase of the best products and services available in the industry.
Renowned historian Doris Kearns Goodwin gave a captivating and heartfelt presentation based on her best-selling book Team of Rivals: The Political Genius of Abraham Lincoln during the opening General Session on Sunday sponsored by Yardi/SiteStuff. Goodwin described how part of Lincoln's great success was his ability to put the welfare of the country before his personal feelings by surrounding himself with an inner circle made almost entirely of his former political enemies. Lincoln worked with his "team of rivals" to end slavery and the Civil War, and in the process, provided future generations with lessons in leadership that apply to both politics and business. Goodwin explained that a big part of Lincoln's success was that he "worked harder than most of his political rivals and he didn't disparage them." She listed several attributes that helped Lincoln succeed in politics and life, which included his acceptance of differing opinions, his willingness to share credit and shoulder blame, and an awareness of his own weaknesses. Goodwin also shared her memories of working with President Lyndon Johnson and inheriting a love of baseball from her father.
During the annual State of the Industry address, BOMA President and Chief Operating Officer Henry H. Chamberlain, CAE, APR, gave a fairly optimistic forecast for commercial real estate despite a weakening national economy that has seen more than 400,000 job losses since the begin of the year.
Highlights from Chamberlain's speech included:
o Vacancy rates are beginning to creep up, but downtowns continue to thrive. Total income in downtown office buildings increased by 5 percent, while rental rates increased by 4.8 percent, according to the 2008 Experience Exchange Report.
o Rental rates continue to rise, although they have slowed somewhat.
o Although 15 million sq. ft. of new office space was delivered in the first quarter of 2008, the demand is slowing, which we can see through the sluggish rate of absorption. Total net absorption for 2007 was 53.4 million sq. ft., down from 79.8 million in 2006. (Divided Capital Research)
o The office sector is still the best investment in real estate. Torto Wheaton Research tells us that real estate continues to be a focus of institutions for diversification.
o BOMA's legislative agenda on the tax side is building into one of the most contentious and important in years as lawmakers try to find an AMT "fix," reduce the federal deficit and look for ways to pay for additional health care and more, many are eyeing real estate's core tax extenders. Carried interest, brownfields and leasehold depreciation will be battleground issues.
o BOMA is helping landlords stay competitive with sustainability and energy efficiency. The relative stability of utilities expenses in office buildings (2008 EER), despite the rise in energy costs, tells us no- and low-cost energy efficiency strategies and initiatives like BEEP and the 7-Point Challenge are working.
In a survey by BOMA, the U.S. Green Building Council (USGBC) and Real Estate Media, an overwhelming 82 percent of property professionals said greening their portfolios was a priority. And nearly two-thirds of respondents have allocated funds to green initiatives.
Recruiting and retaining talent will be among our biggest challenges in the coming years. Creating more curricula in colleges and in the workplace is crucial. BOMA's Foundations of Real Estate Management is providing core education for the next generation of property professionals.
The upcoming election could alter the political and business landscape. Both Sens. Obama and McCain have said that they value free market dynamics and the entrepreneurial spirit of our economy. We need to make the business case for commercial real estate with them to strengthen our efforts on Capitol Hill next year.
Sustainability Visionaries took the stage during the Monday General Session sponsored by Kimberly-Clark Professional. Green business leaders discussed the realities and opportunities before commercial real estate. Setting the stage for the sustainability discussion was Fortune senior writer Marc Gunther, revealing how corporate America is making the business case for going green. The panel was moderated by award-winning broadcast journalist Forrest Sawyer and panelists included BOMA Chairman Brenna Walraven; Sally Wilson, CB Richard Ellis; Arah Schuur, Clinton Climate Initiative; Catherine Greener, Saatchi & Saatchi S.; and Rick Fedrizzi, USGBC.
Insights from the panelists included:
o "You're seeing brilliant CEO's putting their energy into sustainability. We need to understand that this is where we're headed." --Rick Fedrizzi
o "We've trained more than 1,000 in BEEP courses alone, but the other part is educating tenants -- communication is huge." --Sally Wilson
o "Wal-Mart is training their 1.8 million associates on sustainability, and they are also working with their 60,000 suppliers." --Catherine Greener
o "We work in 40 cities and are seeing all kinds of mechanisms being used. There is some very creative thinking as owners get in front of regulatory rules with energy efficient best practices." --Arah Schuur
o "We can move faster and accomplish more with incentives in a voluntary marketplace, and real estate companies should get the credit for efficient operations." --Brenna Walraven
The Office Building Show, presented by BOMA International and Buildings magazine, drew thousands of real estate professionals looking to solve the most challenging building performance and operations issues. A popular attraction of the Show, the Green Pavilion and Energy Star Showcase, featured cutting-edge products and services specifically designed to help existing buildings implement sustainable solutions. Among the innovative exhibits on the show floor was a replica of a "green roof" by exhibitor ValleyCrest, which gave show attendees a "green" rooftop garden to relax in, as well as a glimpse into the energy-saving capabilities of state-of-the-art green roof technology.
The Green Pavilion wasn't the only place to see sustainability in practice. From selecting hotels with energy management practices to providing registration bags made of recycled material to reusing name badges and other conference materials, the theme of "Reduce, Reuse and Recycle" was put into practice throughout the conference. With a reputation for being one of the greenest cities in America, Denver met BOMA's challenge to put on the greenest conference to date.
The green theme could also be experienced in the educational programming offered during the conference. "Achieving Sustainability" was just one of five core education tracks, along with "Building a High Performance Team," "Enhancing Asset Value," "Exploring New Business Opportunities" and "Optimizing Technology." Leading industry experts -- both practitioners and scholars -- presented on more than 40 sessions on a broad range of topics from recruiting, retaining and developing talent to achieving better NOI, and everything in between.
No BOMA conference would be complete without a great party or two, and this year there was plenty of celebrating as industry peers gathered to network, share information and celebrate the continued success of commercial real estate. The celebrations kicked off with a "Party in the Park" sponsored by Schindler Elevator Corp. to open The Office Building Show, immediately followed by the BOMA/Denver Metro "mile-high" Welcome Party at the Denver Center for the Performing Arts with a breathtaking view of the Colorado Rockies as a backdrop.
The 2008 BOMA International Conference came to a close with the highly anticipated TOBY and Earth Awards Reception and Banquet. The Office Building of the Year (TOBY) and Earth Awards honor the buildings -- and the men and women who own and manage the buildings -- that exemplify excellence in building management, operational efficiency, tenant retention, emergency planning and community impact. Special thanks goes to Grubb & Ellis for sponsoring the TOBY reception and to Securitas Security Services USA for sponsoring the TOBY awards program and banquet.