REAL ESTATE IMPACT REAL ESTATE IMPACT THE POWER TO CHANGE A CITY At the annual UM Real Estate Impact Conference, industry leaders examined new ways of thinking, the financial markets and more. By Jennifer LeClaire SOUTH FLORIDA is a prime example of an area’s future be- ing changed due to the power of real estate. From mixed- use developments and walkability to creativity in com- mercial and residential sectors, real estate experts from around the country cited developers in the area as lead- ers in innovative thinking during the 2014 University of Miami Real Estate Impact Conference. The UM School of Business and School of Architecture jointly hosted the conference, which brought together nearly 300 industry professionals on Feb. 13 at the newly minted Perez Art Museum Miami. Although the conference covered the national picture in real estate as well, discussion often came back to South Florida, particularly Miami. PHOTO: LOREM IPSUM PLURIBUS CARPE PLURIBUS IPSUM LOREM PHOTO: Spring/Summer 2014 BusinessMiami 41 41-44 RealEstate Summer 14 R10.indd 41 7/24/14 12:30 PM REAL ESTATE IMPACT Jorge Perez, chairman, Jodie W. McLean, CEO, and founder of The president and Related Group CEO, EDENS However, the picture in Miami principal of The Winnmark Group, isn’t only rosy, cautioned panelist “Mixed-use properties outperform Jorge Perez, CEO of Miami-based other product types on a five-to 10- developer The Related Group, one year term.” And, he added, they have of the nation’s largest condominium fewer commercial mortgage-backed developers. On the one hand, he securities (CMBS) defaults. said, “South Florida has become, Panelists noted the Miami area’s as opposed to just being fun in the many walkable areas and the emphasis sun, a serious city, a great city.” But on continuing to develop walkable he added, “We still don’t have the projects and districts. That, too, adds local buyers for our private properties to a property’s value. “The market we’re building.” value of real estate, from office to retail uring one session, Keith Oden, presi- Perez also pointed to rising con- to multifamily, with high walk scores dent of Camden Property Trust, said struction costs as an issue that could exceeds property values of real estate that South Florida is the fifth-best- slow down the area’s booming condo with poor walk scores,” Troen said. performing real estate market in the market. But other panelists said they Robert L. Chapman, founder and U.S. today — behind only Atlanta don’t see hard costs — which include managing director of Traditional and three Texas markets — for his land acquisition prices and financ- Neighborhood Development Part- company, which is building multifam- ing costs — going up much more in ners, explained why what he called ily communities in Plantation and the near future. And, added Stuart “walkable urbanism” is difficult to Boca Raton and expects a 5% growth Miller (JD ‘82), CEO of Miami-based finance. “The underwriting process is rate in its South Florida portfolio homebuilder Lennar Corp., in South such that underwriters can’t deal with this year. “We love this market,” Florida’s single-family home sector, ris- complex problems,” he said. “But Oden said. “We think there is a lot of ing construction costs aren’t as critical that may change with the break- underlying strength here, and 2014 a factor in final pricing, due to stable throughs in quantum computing.” looks to be another strong year.” land costs and rising home prices. Keynote speaker Barry Sternlicht, NOVEL FINANCING AND COMMERCIAL REAL CEO of Starwood Capital Group, MIXED USE – THE “INVISIBLE ASSET CLASS” ESTATE APPROACHES noted that the South Florida residen- One of Miami’s greatest assets is Novel financing methods and markets tial real estate market is hitting the the mixed-use properties that have are increasingly important to real estate right notes. “It’s vibrant, and I don’t become common in the area over the developers. Sternlicht, for one, finds see any reason it shouldn’t accelerate past 10 years. It’s a real estate class that that to be one of the most exciting as- now. Not flatten or plateau, but actu- both capital markets and developers pects of the industry right now. “It may ally accelerate,” he said. “Miami is shy away from, because it’s perceived be the most interesting time I’ve seen still a little bit of a secret ... but word as more difficult to develop. But, said in my career because of the ability to is getting out.” Mark L. Troen, managing partner and do things in the public market as well PRODUCTIONS GORT 42 BusinessMiami Spring/Summer 2014 41-44 RealEstate Summer 14 R10.indd 42 7/24/14 12:30 PM REAL ESTATE IMPACT REAL ESTATE IMPACT Keynote speaker Vincent Signorello, Barry Sternlicht, Avra Jain, chairman president and CEO, chairman and CEO of and founder, Florida East Coast Starwood Capital Group The Vagabond Group Industries as the private market,” he said. “Glob- ally that’s true. There’s probably more At bus.miami.edu/RE2014, go in-depth with full videos and money available in public markets now briefing papers on all four sessions: than in private markets.” The Invisible Asset Class Initiative with Robert L. Chap- Panelists at the conference also man of Traditional Neighborhood Development Partners; discussed a variety of other topics, from Kurt Roeloffs, former chief investment officer for Deutsche Flagler East Coast Industries’ expan- Bank (RREEF) Alternative Asset Management; Mark L. sion into logistics in Latin America Troen, managing partner and principal of The Winnmark and planned Orlando-to-Miami rail School and a key conference organizer, Group; and moderator Laura Heery Prozes, co-founder of service; to The Vagabond Group’s role felt it was important to get the com- Brookwood Group as a catalyst in transforming the Miami munity together to meet the needs of Modern (MiMo) area through its revi- attendees. “The people who work in Think Differently! Innovation, Entrepreneurship and talization of the historic Vagabond Mo- commercial real estate are interested Leadership in Commercial Real Estate with Avra Jain, tel; to the changes that traditional malls in an amazing variety of projects,” she chairman and founder of The Vagabond Group; Jodie W. and retail centers are making to remain said. “As a university, we try to be a McLean, president and chief investment officer of EDENS; relevant in the age of e-commerce. thought leader and a convener to bring Vincent Signorello, president and CEO of Florida East Coast Like many real estate-related all of these great minds together.” Industries; and moderator Charles Bohl, associate professor companies today, “we’ve completely School of Business Dean Gene and director, Graduate Program in Real Estate Development shifted our mindset,” said Jodie W. Anderson noted the importance of and Urbanism at the UM School of Architecture McLean, president and CEO of the University’s role as a convener of The Power of the Residential Real Estate Market to Change EDENS, a South Carolina-based minds and a catalyst for the commu- a City’s Future with Stuart A. Miller, CEO of Lennar Corpora- shopping center operator. The nity. “We want to be part of Miami’s tion; D. Keith Oden, president and trust manager of Camden company is moving to reclaim and future,” he said. “This conference Property Trust; Jorge M. Perez, chairman, CEO and founder rebuild spaces that give communities is an opportunity for us to bring of The Related Group; Steven C. Witkoff, chairman and CEO gathering places where people can together thought leaders to discuss of The Witkoff Group; and moderator Howard M. Lorber, slow down in a convenient, safe and areas of vital importance to Miami.” president and CEO of Vector Group Ltd. and chairman of vibrant atmosphere. As she sees it, Heuson added, “The benefits of Douglas Elliman today’s most successful retailers blend this type of conference aren’t always irresistible goods or services, a sense apparent until two or three years Keynote speaker Barry Sternlicht, chairman and CEO of of place, e-commerce and new ways down the road when people who met Starwood Capital Group and UM President Donna E. Shalala of engaging consumers. here cross paths again and realize the Plus: benefits of networking.” • Photo gallery CONVENING THE COMMUNITY Presenting sponsors for the confer- • CNBC coverage Although the Real Estate Impact Con- ence included Douglas Elliman Real • Full biographies of speakers and moderators ference covered a lot of topics, Andrea Estate, the Kislak Family Foundation • Insights from previous UM Real Estate Impact Conferences GORT PRODUCTIONS GORT Heuson, a professor of finance at the and The Witkoff Group. Spring/Summer 2014 BusinessMiami 43 41-44 RealEstate Summer 14 R10.indd 43 7/24/14 12:30 PM REAL ESTATE IMPACT 44 BusinessMiami Spring/Summer 2014 41-44 RealEstate Summer 14 R10.indd 44 7/24/14 12:30 PM HAPPENINGS ON CAMPUS AND OFF Events Real Estate Impact Conference The School of Business and School of Architecture hosted nearly 300 people at the 2014 University of Miami Real Estate Impact Conference on Feb. 13 at the Perez Art Museum Miami. Douglas Elliman, the Kislak Family Foundation and The Wit- koff Group were presenting sponsors. 1 2 3 1 Jeremy Mizraji (BBA ’13) of GEM Realty Capital; Andrea Heuson, a professor of finance at the School and one of the conference organizers; and David Luski, 4 president and CEO of Key Sponsor DRA Advisors and a member of the School’s Real Estate Programs Advisory Board. 2 Armando Codina, chairman and CEO of Codina Partners, with School of Business Dean Gene Anderson.