Successful Women Encourage: Get Creative, Stay Engaged

June 17, 2013

Is recovery in Chicago’s commercial real estate industry sustainable? This was one of several compelling questions discussed at our 2013 Successful Women in Commercial Real Estate Luncheon, April 9. The event, held annually by C.A.R. CommercialForum in partnership with the Women’s Council of REALTORS-Chicago Chapter and the Goldie B. Wolfe Miller Women Leaders in Real Estate Initiative at Roosevelt University, is always an exceptional learning experience and a networking hot-spot.

This year’s Successful Women panel was moderated by Collete English Dixon, Principal – Transactions for Prudential Real Estate Investors. Panelists included:

–          Angela Aeschliman, Chief Operating Officer, Watermark Property

–          ManagementDenise Stein Chaimovitz, Senior Vice President, Newmark Knight Frank Epic

–          Michelle Panovich, Principal, Mid-America Asset Management

–          Polly Oczak Parchem, President, Winner’s Edge Corporate Real Estate Services

A striking feature in today’s field is the relative lack of retail development, Panovich said. Whereas in 2007 “normal” was considered 7 to 8 million square feet of new space, today 1 million square feet of retail space is the “new normal.”

“We’re starting to see a little more demand but we need a lot more to bring the rents up,” Panovich said. “I think we have a long way to go yet.”

In the industrial sector, Chaimovitz added that the smaller spaces – 2,000 to 50,000 square feet – are those most likely to sit empty, because it’s the smaller tenant businesses that can’t get lending for relocation or expansion. Bigger spaces are less of an issue.

Aeschliman, in property management, said she’s seeing a trend among large companies toward enlisting outside practitioners to manage their assets, whereas for a time many had the function in-house.

Another trend, noted by Chaimovitz, is redevelopment deals.

“Our investment sale brokers cannot keep their clients happy because there’s not enough. They are buying everything,” Panovich chimed in. Class A properties are most in demand because investors remain a little gun-shy and want to stay safe, she explained.

Parchem said it can be difficult to observe trends today because, at a time of creative deal-making, “every deal is so different; it’s apples to oranges. Talking about company deals, you just can’t.”

Indeed, creative deal-making unto itself is an important trend, moving forward.

“There are a lot of potential partnerships out there, not in the traditional sense,” Aeschliman said, referring to adaptive reuse projects. “There’s all this creative thinking going on now about different types of partnerships.”

So stay connected!

“A good lesson for all you younger people in the room is that these partnerships you make early on can come back together,” Panovich said. “No one wants to take risk on by themselves. It takes more equity. You’ve just got to look around. You never know where your next deal is coming from.”

Possible “trip points” for the industry moving forward include continued incidence of retail bankruptcies and the state of Illinois’ financial health.

“I hope Illinois can get over its issues. That would really help business,” Chaimovitz said, adding that in the interim, losing industrial clients to Indiana and Wisconsin is a reality.

“If you are a tenant, you have to make that decision – where to put your store,” Panovich said. “Cook County is about the worst for incentivizing business. We need people who are going to be more proactive about the tax crisis and, if I can say it, the pension crisis.”

Moving forward?

“Get in the game now, if you have any money,” Chaimovitz said. “We’re not going to be at these rates long.”

In addition, stay engaged with your peers and in the industry.

“Get out, join organizations and take classes,” Parchem said.

“The more involved you are, the more people you engage with at every level,” Panovich added. And assist others where you can. “It helps. The payback is tremendous.”

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