Thomas J. Bisacquino. President NAIOP Herndon, VA

Transcription

1 Thomas J. Bisacquino President NAIOP Herndon, VA 1

2 Agenda Today s remarks include NAIOP Today State of the Industry NAIOP s Response Legislative Overview 2

3 NAIOP TODAY

4 NAIOP Today 17,873 members at year-end One-third of all new members are Developing Leaders (35 and under) 57 strong North American chapters Welcome 2 new chapters in 2008! New York City Austin-San Antonio 4

5 NAIOP Today

6 NAIOP Today Offers It s Members Outstanding Professional Networking Opportunities Industry Knowledge and Research Legislative Representation

7 STATE OF THE INDUSTRY

8 State of The Industry Unprecedented global economic crisis , 4 th quarter U.S. GDP - 3.8%. Stock market is in a free fall. U.S. unemployment stands at 7.6% and rising. 9.8% decline in retail sales. U.S. container traffic quickly decreasing, both for imports & exports. 8

9 State of The Industry Capital and credit markets frozen --- $350 to 400 billion in loans maturing in 2009 Most are performing assets Little or no replacement debt available CMBS = $230B; $12B; $??? NAREIT All REIT Index -- 37% drop in 2008, on top of 18% decline in CRE values declining, trending further down due to illiquidity in marketplace & A landlord can t do better than his tenants 9

10 NAIOP S RESPONSE

11 NAIOP s Four-Point Promise In tough economic times, NAIOP members need their association more than ever! NAIOP will continually assess the economic markets and their resulting impact, and extends the following pledge to support our members. 11

12 NAIOP s Four-Point Promise In 2009, NAIOP will: 1. Respond to the Credit and Capital Crisis. 2. Present Crucial, Relevant Viewpoints and Education. 3. Deliver Meaningful Research. 4. Offer Exceptional Membership Services. 12

13 LEGISLATIVE OVERVIEW

14 2009 Legislative Realities Democrats now control House, Senate, and White House. Economic stimulus and credit crisis are top priorities. Pay go rules which Democrats brought back 2 years ago were ignored, now are back!! Big $$$ existing government programs need funding Social Security Medicare AMT fix Transportation Many States projecting huge revenue shortfalls --- can t print $$$ 14

15 2009 Legislative Priorities Reauthorize Tax Extenders Stabilization Act 10/08 15-year depreciation extended for qualified leasehold improvements (TI s) to the end of Brownfields remediation expensing extended to the end of 2009, allowing developers to immediately recoup brownfields clean-up costs. Passed a five-year extension of the Energy Efficient Commercial Building Tax Deduction for developing energy efficient buildings. 15

16 2009 Legislative Priorities Tax Provisions Stimulus Bill -- 02/09 Bonus Depreciate Extension Accelerate the write off of depreciable property to 50% of the costs incurred in Delayed Recognition of Cancellation of Debt Income Defer the tax on CODI for 5 years and then payable over the next 5 years. 5 Year Carryback of NOL for Small Business Extended from 2 years for business with gross receipts of $15 million or less. Extension of AMT Relief For middle income individuals and families. 16

17 2009 Legislative Priorities Capital and credit markets NAIOP working with Treasury Department. Extend Term Asset-Backed Securities Loan Facility (TALF), created to provide cash flow to small businesses and consumer debt (credit cards & auto loans) to include commercial real estate. Create a bad bank as a depository for toxic loans, improving lenders balance sheets, and willingness to lend. 17

18 2009 Legislative Priorities President s Proposed Budget Taxes Carried Interest Treatment Treat as ordinary income as opposed to cap gain. Will move tax from 15% to 39.6% Top marginal rate 35% to 39.6% Cap Gain Rate 15% to 20% 18

19 2009 Legislative Priorities Energy Issues Carbon Cap & Trade system. Legislation that would mandate strict energy efficient targets for state building codes uses ASHRAE 90.1 (2004) as baseline. 30% reduction by 2010 & 50% by ConSol Study --- Modeled Bldg Energy Efficiencies Modeled a newly constructed 95,000 sq ft suburban office building (building type represents over 50% of new class A construction). Used DOE EnergyPlus simulation program. Looked at 3 climate zones. Analyzed more than 40 different efficiency measures. 19

20 2009 Legislative Priorities Energy Issues ConSol Study --- Conclusions.. Chicago 23% savings 8.8 year payback. Baltimore 21.5% savings 11 year payback. Newport Beach 15.8 savings 12.2 year payback. Not all buildings can achieve targets (30% & 50%). Buildings can achieve higher energy efficiencies by utilizing holistic design approaches. Approaches will become more economically feasible with new technologies & Fed, State, and Local incentives. 20

21 A Hog in a Tuxedo is Still a Hog The NAIOP Disinformation Study By Edward Mazria

22 2009 Legislative Priorities Transportation & Infrastructure Transportation Act set to expire August States will be the arbiter of $$$ from Federal government stimulus bill for all shovel ready projects. Environmental Endanger species greater input from landowners & local governments. Wetlands Section 404 permits, simplify process. Labor Union card check eliminate secret balloting in unionizing efforts. 22

23 2009 State Legislative Issues Budget shortfalls -- Revenue Raisers Split role Taxation CA & AZ Higher transfer fees on real property NY Homestead Exemption -- VA Property Rights Hometown Democracy FL Eminent Domain Kelo Case -- 6 states, VA propose a constitutional amendment. Green Mandates LEED Silver requirement CT 23

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25 If you are not willing to be at the legislative table, be assured that you will be on the legislative menu! 25

26 Access to political decision-makers is the key to advancing NAIOP s legislative agenda. 26

27 We need your help to advance NAIOP s critically important legislative agenda! 27

28 Get Involved!! Even if you re on the right track, you ll get run over if you just sit there Will Rogers 28

29 Thank you! 29