November 18, 2013
Message from the PresidentAs the stories in this issue of NewsBrief report, more than 1,400 members of the REIT community gathered in San Francisco last week to participate in REITWorld 2013: NAREIT’s Annual Convention for All Things REIT. NAREIT Announces 2014 Leadership
NAREIT announced last week the election of its 2014 leadership team, as well as the members of its Executive Board, Board of Governors, and Audit and Investment Committee. Ronald Havner Jr., chairman and CEO of Public Storage (NYSE: PSA), was elected NAREIT chair for 2014, succeeding NAREIT’s 2013 chair, W. Edward Walter, president and CEO of Host Hotels & Resorts (NYSE: HST). “I am honored to serve as NAREIT’s chair for 2014,” Havner said. “I am looking forward to building on the strong foundation established by Ed Walter and all of the prior NAREIT chairs who have served the REIT industry so well.” Other NAREIT officers for 2014 are First Vice Chair David Neithercut, president and CEO of Equity Residential (NYSE: EQR); Second Vice Chair David Henry, vice chairman, president and CEO of Kimco Realty Corporation (NYSE: KIM); and Treasurer Edward Fritsch, president and CEO of Highwoods Properties, Inc. (NYSE: HIW). All of NAREIT’s officers are also members of its Executive Board. Members of NAREIT’s 2014 Executive Board are: Thomas Baltimore, president and CEO of RLJ Lodging Trust (NYSE: RLJ); Richard Campo, chairman and CEO, Camden Property Trust (NYSE: CPT); George Chapman, chairman and CEO, Health Care REIT, Inc. (NYSE: HCN); Wellington Denahan, chairman and CEO, Annaly Capital Management, Inc. (NYSE: NLY); Rick Holley, CEO, Plum Creek Timber Company, Inc. (NYSE: PCL); Daniel Hurwitz, CEO, DDR Corp.(NYSE:DDR); Timothy Naughton, chairman and CEO, AvalonBay Communities, Inc. (NYSE: AVB); Dennis Oklak, chairman and CEO, Duke Realty Corporation (NYSE: DRE); Robert Taubman, chairman, president and CEO, Taubman Centers, Inc. (NYSE: TCO); W. Edward Walter, president and CEO, Host Hotels & Resorts, Inc. (NYSE: HST); and Donald Wood, president and CEO, Federal Realty Investment Trust (NYSE: FRT). Members of NAREIT’s 2014 Audit and Investment Committee are: Committee Chair Sandeep Mathrani, CEO, General Growth Properties (NYSE: GGP); Michael P. Glimcher, Chairman and CEO, Glimcher Realty Trust (NYSE: GRT); and Edward J. Fritsch, President and CEO, Highwoods Properties, Inc., serving in an ex-officio capacity as NAREIT’s 2014 Treasurer. A complete list of NAREIT’s 2014 Board of Governors is available on REIT.com. (Contact: Dominique Wilburn at dwilburn@nareit.com)
REITWorld 2013 RecapSan Francisco played host to more than 1,400 industry professionals last week during REITWorld 2013: NAREIT’s Annual Convention for All Things REIT. The annual event was once again a success as 168 corporate member companies interacted with investors over three days at the San Francisco Marriott Marquis. Kenneth Rosen, chairman of Rosen Consulting Group, kicked off the event with his economic outlook. Rosen said the commercial real estate sector is in the "sweet spot" of the economic cycle, with supply and demand fundamentals looking "very good." Rosen cited low building supply nationwide in a number of sectors, including retail and warehouse, as a positive sign for the industry. The warehouse sector, for example, is at a 50-year low in new construction starts, according to Rosen. Looking at how far the industry has come since the historic wave of public offerings in 1993, NAREIT Chair Ronald Havner, Jr. moderated a panel focused on what is ahead for REITs. Joining Havner on the panel were: Richard Campo, chairman and CEO, Camden Property Trust (NYSE: CPT); Mike Kirby, chairman and director-Research, Green Street Advisors, Inc.; Robert Steers, co-chairman and co-CEO, Cohen & Steers Capital Management; and Martin "Hap" Stein, Jr., chairman and CEO, Regency Centers Corporation (NYSE: REG). Kirby said the REIT story "has always looked good to us, and today it looks outstanding." Steers added that prospective growth is "significant," noting that REIT stocks are finding their way into 401(k) retirement plans in a "meaningful way" by means of target date investment funds. Furthermore, Steers characterized global capital flows into U.S. REITs as "massive." Participants in a panel focused on the capital markets predicted that liquidity would continue to be available to REITs into 2014, but they noted that higher interest rates and tapering of Federal Reserve bond purchases will create lingering uncertainty for investors. The panel consisted of: Timothy Pire, managing director, Heitman Securities LLC; Mark Streeter, managing director, J.P. Morgan; Seth Weintrob, managing director, Morgan Stanley; and Raymond Williamson, managing director, Eastdil Secured, LLC. The panel was moderated by Barry Vinocur, editor of REIT Zone Publications, LLC. During NAREIT’s Board of Governors dinner, Leon Panetta, former secretary of defense and director of the CIA, entertained and educated the audience with stories about his career in Washington and provided an insider’s view into the killing of Osama Bin Laden. The second day of REITWorld began with a panel of hotel REIT CEOs discussing prospects for the sector. Moderated by William Crow, managing director with Raymond James and Associates, the panelists agreed that the hotel sector is benefitting from a combination of low supply, healthy demand, and strong corporate balance sheets. Panelists included: Jon Bortz, chairman and CEO of Pebblebrook Hotel Trust (NYSE: PEB); Kenneth Cruse, CEO, Sunstone Hotel Investors, Inc. (NYSE: SHO); Colin Reed, chairman and CEO, Ryman Hospitality Properties, Inc. (NYSE: RHP); and Jay Shah, CEO, Hersha Hospitality Trust (NYSE: HT). With a spotlight on the sector following some high-profile acquisitions, a panel of net-lease REIT CEOs told a REITWorld 2013 forum that the sector is likely to continue on a path of solid growth, fueled in part by an inflow of assets from the non-traded segment of the market. Moderated by Todd Stender of Wells Fargo Securities, the panel featured: Trevor Bond, president and CEO, W. P. Carey Inc. (NYSE: WPC); Craig Macnab, chairman and CEO, National Retail Properties, Inc. (NYSE: NNN); Nicholas Schorsch, CEO, American Realty Capital Properties, Inc. (NASDAQ: ARCP); and Amy Tait, chairman, president and CEO, Broadstone Net Lease, Inc. Sam Zell, chairman of Equity Group Investments, LLC, offered a broad perspective on the state of the REIT industry during his luncheon conversation with NAREIT President and CEO Steven A. Wechsler. The legendary entrepreneur predicted that the sector could double in size in the next 20 years. "We've established a model that works," stated Zell, adding that the key to the sector's success has been "the seamless ability to convert from private to public." Zell, who gave a landmark speech in 1993 that helped usher in the Modern REIT Era, noted that the period from 1993 to 2013 has seen the industry's market capitalization grow from $7 billion to $700 billion. "If you can successfully negotiate in the public markets, there will be no place your assets can get a higher value," he said. While admitting that he was not able to predict the staggering growth of the industry back in 1993, "I could see that every real estate operator would find the REIT structure the most attractive format for going forward." REITWorld 2013 concluded with a look at the political landscape featuring comments from Alex Castellanos, political strategist and CNN analyst, and Stephanie Cutter, political strategist, deputy campaign manager for the 2012 Obama Re-election Campaign, deputy senior advisor to President Obama (2009-2011) and CNN political commentator and co-host of “Crossfire.” (Contact: Pam Coleman at pcoleman@nareit.com)
Blair, Ferguson Receive Industry Awards
At REITWorld 2013, NAREIT presented its 2013 Industry Leadership Award to Bryce Blair, former chairman and CEO of AvalonBay Communities (NYSE: AVB), and its 2013 Industry Achievement Award to Ritson Ferguson, CEO and co-chief investment officer of CBRE Clarion Securities. The NAREIT Industry Leadership Award is presented annually to a REIT executive who has made a significant and lasting contribution to the growth and betterment of the industry. The award is presented in memory of Edward H. Linde, the late CEO of Boston Properties. “Bryce has made important contributions to the betterment of the REIT industry over the course of his career,” said NAREIT’s 2013 Chair W. Edward Walter, president and CEO of Host Hotels and Resorts (NYSE: HST), in presenting the award. Blair served as NAREIT chair in 2011, as well as first vice chair in 2010 and second vice chair in 2009. “He also has provided leadership and support for NAREIT’s investor outreach program, working to increase REIT investment at the nation’s largest pension plans and defined contribution plan providers,” Walter said. The NAREIT Industry Achievement Award is presented annually to professionals serving the REIT industry whose acumen and integrity have helped heighten awareness and understanding of the value of REITs and publicly traded real estate. The award is presented in memory of E. Lawrence Miller, the former CEO of one of the industry’s first REITs, Bradley Real Estate Trust, and a past NAREIT chair. NAREIT recognized Ferguson for his efforts that moved REITs into the investment mainstream. “Ritson played an important role in both telling the REIT story, and in building an investment platform to make broad-scale REIT investment possible in those formative years of the modern REIT industry,” said NAREIT 2014 Chair Ronald Havner, Chairman, CEO and President of Public Storage, who presented the award. With two partners, he formed the predecessor company to CBRE Clarion Securities in 1991. As a dedicated REIT fund manager, he did pioneering work to introduce, explain and build acceptance among investors for the REIT investment proposition. “Ritson’s efforts helped make possible the exceptional expansion of the U.S. REIT industry that took place in the first two decades of the Modern REIT Era. His work has helped make the industry into the vibrant marketplace it is today.” Robert Steers, co-chairman and co-CEO, Cohen & Steers, Inc., received the 2012 NAREIT Industry Achievement Award. The award was formally presented to Steers during REITWorld 2013. (Contact: Ron Kuykendall at rkuykendall@nareit.com)
Eight Members Honored for Energy Use Practices
NAREIT announced the winners of its annual Leader in the Light Awards, which honor NAREIT member companies that have demonstrated superior and sustainable energy use practices. The Leader in the Light Awards are presented to REITs in eight property sectors: Health Care; Industrial; Lodging/Resorts; Office; Residential; Retail; Diversified; and Global, for non-U.S. companies. This year’s award winners were:
“Sustainability is a key issue for property companies today, and REITs are in the forefront of sustainable energy use practices in the commercial real estate industry,” said Sheldon Groner, NAREIT’s executive vice president for finance and operations who administers the Leader in the Light Awards program. NAREIT has been presenting the Leader in the Light awards since 2005. Last year, the organization modified its judging criteria to include the results of the Global Real Estate Sustainability Benchmark (GRESB) Annual Survey. The GRESB Annual Survey measures the environmental performance of property portfolios around the world, and the survey format is backed by many of the world’s largest institutional investors. Incorporating the GRESB survey results into the Leader in the Light judging criteria enables the companies competing in Leader in the Light to measure their performance against a global benchmark. The 2013 Leader in the Light Awards applications were evaluated by a panel of three primary judges, including David Stanford of Real Foundations, Mark Vorreuter of Cornell University and Nils Kok of GRESB. Two additional judges provided guidance on the evaluation and scoring process: Douglas Gatlin of the U.S. Green Building Council and Maria Vargas of the U.S. Department of Energy. The Leader in the Light Awards were presented at REITWorld 2013, NAREIT’s Annual Convention for All Things REIT in San Francisco. (Contact: Sheldon Groner at sgroner@nareit.com)
REIT.com Videos: CEO SpotlightA host of REIT CEOs sat down for video interviews with REIT.com at REITWorld 2013: NAREIT’s Annual Convention for All Things REIT in San Francisco. CIAT Encourages House Members to Extend TRIAThe Subcommittee on Housing & Insurance of the House Committee on Financial Services held a hearing last week on the state of the terrorism insurance market. NAREIT and its partners in the Coalition to Insure Against Terrorism (CIAT) offered comments to the panel in conjunction with the hearing. REESA Meeting Covers Accounting, Earnings Metrics, Sustainability Issues
The Real Estate Equity Securitization Alliance (REESA) met at REITWorld 2013: NAREIT’s Annual Convention for All Things REIT in San Francisco to address a number of important issues to the real estate industry worldwide. Topics under review included proposed changes to accounting and financial reporting standards issued by the Financial Accounting Standards Board and the International Accounting Standards Board. Supplemental earnings metrics defined by REESA organizations and the development of a global uniform baseline metric were also discussed. Other areas under review ranged from industry indexes to sustainability issues and REESA’s initiative with the Global Real Estate Sustainability Benchmark (GRESB). Attending the REESA meeting were the Association for Real Estate Securitization (Japan); the British Property Federation; the European Public Real Estate Association; the Property Council of Australia; and the Real Property Association of Canada. (Contact: Bonnie Gottlieb at bgottlieb@nareit.com)
REIT.com Videos: REITWorld 2013Dozens of REIT analysts and investors sat down for video interviews with REIT.com at REITWorld 2013: NAREIT’s Annual Convention for All Things REIT in San Francisco. Latest Issue of REIT Magazine Now Available
NAREIT Welcomes Two New MembersNAREIT is pleased to welcome two new corporate members. Brixmor Property Group (NYSE: BRX) is a publicly traded, internally advised equity REIT that owns and operates the largest wholly owned portfolio of grocery-anchored community and neighborhood shopping centers in the U.S. The Brixmor portfolio is comprised of 522 shopping centers with more than 70 percent of the shopping centers anchored by market-leading grocers. Brixmor, which Blackstone recently spun off, is based in New York City. Michael Carroll is the CEO and Michael Pappagallo is the president and CFO. |
11/18/2013
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