Speakers at ULI’s 2018 fall meeting focused on diversity initiatives, the use of blockchain in commercial real estate and urban development.
Diversity, sustainability, blockchain—these were just a handful of the topics touched on during the first day of presentations at the Urban Land Institute’s (ULI) annual fall meeting currently taking place in Boston. Here are eight takeaways from Tuesday’s sessions.
- Diversity is good for business. Firms that employ more women and diverse employees—which brings in a range of viewpoints—perform better, says Camille Renshaw, CEO and co-founder of B+E, a net lease brokerage firm. But more than that, the diversity gap can provide business opportunities. For example, 2 percent of venture capitalist funds go to women, a statistic Renshaw cited from Pitchfork. “She’s not getting as many looks, she is less likely to raise that capital,” she said. “Is that a business opportunity? I think it is.” Promoting equality could also become a competitive edge in recruiting: if there is a female candidate a firm wants to recruit, offering her pay parity would already put that firm above a competitor. “Have you ever thought of it that way?” Renshaw asked the crowd. “It’s a business opportunity.”
- Measure diversity and inclusion as a revenue initiative. Companies can tackle diversity and inclusion issues with key performance indicators like any revenue initiative, Renshaw said. “Measure the results,” she said. “Set goals.”
- There’s a lot of hype around blockchain and its uses for real estate. To start, there are several key questions to make sure blockchain—most simply, a digital ledger—would be a good tool to use for any industry or business, according to Matt Higginson, a partner in the New York office of consultancy firm McKinsey. These include: Do I need a distributed database, where identical copies of data are needed? Do I want to share information with competitors, to benefit an entire industry? Is there economic value in building a blockchain solution and, if so, what is the return on investment? In the real estate industry, blockchain could be used to store static data, like property titles, for example, that could be shared throughout a distributed network. It could also be used to trade information rapidly—for example, not just titles but transaction costs as well, Higginson said.
- But blockchain can also be problematic. “Blockchain is not a silver bullet,” Higginson said. There is still a lot of experimentation going on in the space, and the tool is not cheap, he noted. The move from paper to digital records is also not trivial; questions surrounding verification and integrity of data are important to consider. “This is still an immature technology,” Higginson said.
- A community’s creative class can provide development opportunities. Drawing on several examples throughout Europe, Julian Petrin, a partner at German urban development consultancy urbanista, discussed how artists can bring about the redevelopment of underused urban spaces. For example, near Petrin’s office in Hamburg, a group of artists moved into abandoned buildings that had been handed over to a developer who did nothing with them. The artists created a movement that led the space to be used for celebrations and exhibitions. “They really brought this place that was abandoned for years back on the map,” Petrin said. This caused the city to buy back the property and ensure that in the future properties will be given to those with cultural concepts, not just economic ones, he said. “Start to learn this is a big force for urban change,” Petrin said.
- Sometimes, development can simply be about culture and beauty. This was a message reflected in the speech given by ULI’s opening session speaker, Chicago-based artist Theaster Gates. Gates’ work focuses on reclaiming what has been left behind—for example, converting an abandoned bank in the South Side of Chicago into a cultural amenity. Sometimes, such projects can provide beauty and hope to overlooked neighborhoods, which may be needed even more than big retail chains that can pay the bills. “You’re planning these things because you’re thinking about the rents, but we’re often planning without thinking about people’s needs,” Gates said. “So, I’m trying to find ways to do that.”
- “Build, baby, build.” That is how developers can tackle affordable housing shortages, according to Jay Ash, Massachusetts’ secretary of housing and economic development. Both the City of Boston and the state have set goals and dedicated funds to create affordable housing, Ash said. “We’re in it together, mayor and the governor, the staffs are in it together. Our funds are almost fungible, state money and city money, to create more affordable housing and we need every bit of it and more.”
- Customers, shareholders, employees and communities increasingly care about sustainability. Companies are internalizing sustainability management and sustainability departments are growing within large real estate firms, said Ben Myers, director of sustainability at office REIT Boston Properties. The large corporate tenants the firm is looking to attract have strong sustainability platforms and look for green features in the spaces they want to occupy. “Our alignment with them creates a more sticky relationship through the development of new product, and also the positioning of our existing buildings throughout our portfolio,” Myers said.