The Weekly Take from CBRE

One’s an office occupier—Orrick’s Laura Saklad—and the other’s an office investor—CBRE Investment Management’s Julie Ingersoll. From opposite sides of the table, they discuss how property investors and occupiers can work together to facilitate return-to-office strategies and make the workplace a magnet for talent attraction and retention.Insights to Share:·      Successful office occupancy strategies are about balancing employee flexibility with collaboration and professional development opportunities.·      The surrounding neighborhood is an important amenity for office space.·      The pandemic has brought landlords and tenants closer together, changing the relationship from adversarial to a partnership.Laura SakladChief Operations OfficerOrrickLaura is responsible for leading and directing all operational functions of Orrick, a law firm with more than 25 global offices. She works closely with the Orrick’s Board and Management Committee to execute the firm’s strategy. Julie IngersollChief Investment OfficerAmericas Direct Real Estate StrategiesCBRE Investment ManagementJulie joined the firm in October 2021 from CPP Investments, an approximately $500 billion Canadian Pension Plan, where she was Managing Director overseeing portfolio strategy design and execution for 50 million square feet of U.S. residential and retail investments. At CPP, Julie focused on core-plus, value-add and development risk profiles, leading efforts across the investment lifecycle from identifying new strategies, originating and structuring joint ventures, acquisitions, asset management and dispositions.

What commercial real estate stories will make headlines this year? Diana Olick knows. The CNBC reporter talks interest rates, work from the office, the future of cities, climate strategies and more.Insights from CNBC’s Diana Olick: One solution to the housing affordability crisis is the addition of supply at scale.Trends in climate and real estate are interwoven.For many people, renting a home makes more financial sense than purchasing.Some employees enjoy the dynamic energy of working in the office, much like the vitality of living in the city. The successful office investor will design workspaces to encourage collaborative productivity.

What will the future office look like? Ask an interior designer. ThinkLab’s Amanda Schneider offers insights on how organizations can use design to support everything from hybrid work strategies to employee health and safety and from sustainability to portfolio optimization.Insights to Share: Hybrid work has brought interior design innovation to the forefront of conversations around productivity and the value of the office.Many organizations are seeking intelligent ways to incorporate technology into the workplace design, and even their furniture, to measure their occupancy and effectiveness.People do not want to come into the office and do the same work they do at home, so office design must account for changed workplace uses.

CEOs of The Office Group and Industrious discuss the flex space office market in the wake of WeWork’s high-profile bankruptcy.Insights to Share: Despite recent headlines, the future of flex office is bright.Flex office space within the building stack can enhance asset value.Collaboration spaces and individual private spaces, like pods or booths, have gained favor among flex-office occupiers. Large, open floorplans with rows of desks have drawn less interest.

U.S. Air Force veteran and consultant DeDe Halfhill discusses effective leadership qualities, debunks management myths and shares tactics for team-building and improving productivity.Insights to Share from DeDe Halfhill: ·      Creating a culture of open feedback is incredibly important for those in leaderships roles but often hard to achieve given the power differential with subordinates.·      Empathy is critical to good leadership.·      The effective integration of diversity is a critical skill for future leaders.

Focus on managing assets and debt effectively instead of waiting for interest rate drops. Innovation is key in a high-rate environment. Understanding market needs requires both human and artificial intelligence. Explore the concept of DeFize and its role in substituting collateral. Shift focus from individual assets to the organization managing them. Gather information from different business lines for effective decision-making. Importance of behavioral economics and data in real estate industry. Use structured data and a human element in data analysis.

In a bonus episode from our 2024 Outlook, Chief Economists Jim Costello (MSCI Real Assets) and Richard Barkham (CBRE) respond to live audience questions about the 2024 commercial real estate outlook.

Our annual must-listen episode. Chief Economists Jim Costello (MSCI Real Assets) and Richard Barkham (CBRE) share their predictions for the global economy, interest rates, capital markets and investment opportunities across commercial real estate sectors.THIS WEEK'S GUESTSRichard BarkhamGlobal Chief Economist, Head of Global Research & Head of Americas Research, CBRERichard Barkham leads a global team of nearly 600 research experts who help CBRE’s clients understand the forces shaping the commercial real estate industry. One of the world’s leading real estate economists, Richard combines the theoretical framework of an academic with hands-on experience in development to deliver actionable insights for real estate investors and occupiers. A frequent source for both clients and journalists navigating moments of economic volatility, he is particularly interested in the role government stimulus plays in long-term economic recoveries.Jim Costello Executive Director MSCI Research Jim is chief economist on the MSCI Real Assets team and is based in New York. He is the principal author of the US Capital Trends report series and a frequent speaker at commercial real estate conferences. At Real Capital Analytics, which MSCI acquired in 2021, Jim was a leader for analysis across the commercial property universe. Jim also spent two decades at Torto Wheaton Research (now known as CBRE Econometric Advisors) working on issues of real estate risk and forecasting. He recently finished serving a term on the Commercial Board of Governors of the Mortgage Bankers Association and is currently a member of The Counselors of Real Estate.

As you make big plans for 2024, here's one of our most popular episodes from the past year featuring author and professor Bent Flyvbjerg talking about how he and his team studied more than 16,000 projects—from skyscrapers to Oscar-winning films—to learn the secrets of their success, and the common thread in their failures.THIS EPISODE'S GUEST:Bent FlyvbjergProfessor, Oxford University and IT University of CopenhagenBent Flyvbjerg is the first BT Professor at Oxford University and the VKR Professor at the IT University of Copenhagen, an economic geographer, and “the world’s leading megaproject expert,” according to global accounting network KPMG. He has consulted on over one hundred projects costing $1 billion or more and has been knighted by the Queen of Denmark.

2023 was a challenging year for commercial real estate, driven by sharply rising interest rates, economic uncertainty and continued slow progress on return-to-office plans. Join us as we look back at everything from market conditions to labor issues to office amenities to emerging technologies and more.Insights to Share: ·     The commercial real estate market in 2023 was challenged by sharply rising interest rates, but fundamentals largely held up, aside from the office sector.·     Technological advancements, particularly artificial intelligence (AI), played an increased role, especially in Data Centers but elsewhere as well.·     U.S. seaports made strides in solving pandemic-era bottlenecks and other challenges.