Networking and Business Solutions Draw BOMA Members to Winter Business Meeting
“Now More than Ever” was the rallying call that brought hundreds of BOMA leaders and members to Palm Springs, Calif. to chart a course for recovery and growth during the annual Winter Business Meeting, January 16-19. With the economy in the grips of the worst recession in years and commercial real estate feeling the effects of the deepening credit crisis, BOMA members showed up ready to get to work and map out a plan to strengthen asset value by bringing new solutions to business practices.
Troubled Times Call for Exceptional Asset Management
 Economist Ray Torto addresses BOMA member at the Opening Luncheon |
Renowned industry economist Raymond G. Torto, PhD, CRE, global chief economist, CB Richard Ellis, provided the keynote presentation during the Opening Luncheon sponsored by AlliedBarton, telling attendees that while our situation is unprecedented, it’s important to keep it in perspective. Torto pointed to many of the indicators that showed the rapid economic decline in 2008, including the loss of 2.6 million jobs, a 38 percent decline in the S&P 500 and a 22 percent decline in home prices. The economy and commercial real estate were particularly hard hit in the fourth quarter of 2008, with office vacancies at 13.9 percent and predicted to go higher as more Americans lose their jobs.
Torto told attendees that part of the economic collapse is due to the government’s response to the credit collapse. “The government policies of this past fall are a big part of the problem,” said Torto. “Everything fell off the cliff in the fourth quarter, including the real estate office market, which had positive absorption for a year until it went to 4.8 million negative absorption in downtown office in the fourth quarter.” When asked when things will begin to turn around, Torto answered that the first indicator will be when spreads start to get a little narrower. He also stated that the pending stimulus package could have an impact, and if it works things could begin to turn around by the fourth quarter of 2009, otherwise we could continue on this path until 2011. Torto stressed that “asset management is the key to survival” as we work through the difficult months ahead.
Town Hall – A Holistic Approach to Building Operations
BOMA International’s newest initiative, BOMA 360 Performance Program, was introduced during an energetic Town Hall meeting. Ray Mackey, BOMA International vice chair explained that the new program is a “validation and industry recognition of buildings that demonstrate best practices encompassing all major aspects of building management and operations.” The program includes an online self-assessment that evaluates six major components: building operations and management; life safety/security/risk management; training and education; energy; environmental/sustainability; and tenant relations/community involvement. It was launched in response to market research that identified a need to differentiate buildings within the marketplace, and, unlike other programs that only focus on certain aspects of building operations, BOMA 360 is a very broad program with a holistic view of building operations. “When we look back in BOMA history, I believe we will think about BOMA 360 the same way we do BEEP, the EER and the BOMA Floor Measurement Standard,” said Mackey. The BOMA 360 Performance Program will launch in April.
 Joe Markling, BOMA/Greater Los Angeles, makes a point during the Town Hall Meeting |
The upcoming launch of the new, online Experience Exchange Report (EER) was another discussion item during Town Hall. BOMA Vice President of Education and Research Lorie Damon, PhD, explained that market research indicated that the EER needed to evolve and go online. To make this significant transformation, BOMA teamed up with Kingsley Associates, an industry leader in research and consulting services with an excellent understanding of commercial real estate. Kingsley Associates will help collect, analyze and publish data while opening up new markets for the EER. Kingsley Associates Vice President Phil Mobley was on hand to give attendees a first glimpse of the new online tool. Some of the benefits of the new EER include: ability to customize data to need, ability to buy data only in required markets, more expense detail and better comparisons, and the ability to cut and paste charts into documents.
Other Town Hall topics included a “sneak peek” at BOMA’s new Web site. BOMA Director of Web Services Jon Hadley gave a demonstration of the completely rebuilt Web site designed to be easier to navigate and loaded with new resources and information to help BOMA members find what they need, stay informed, get involved and interact with peers and colleagues.
BOMA President Henry Chamberlain concluded the Town Hall meeting with an interactive discussion on Best Ways to Market BOMA. Among the suggestions offered up by Town Hall attendees…
- Drive membership through tenants with advertising and other outreach vehicles. Ask tenants if they are in a “BOMA-run building” to help brand BOMA while incorporating the BOMA 360 Performance Program. (BOMA San Francisco)
- “Ask early, ask often” to drive membership while continuing to promote great programming (BOMA/Atlanta)
- Build an owners council through your local BOMA to advance advocacy issues, which are often very effective from the top down because owners have an important stake in so many advocacy issues, particularly those tied to capital gains and tax issues. (BOMA/Detroit)
Board of Governors
Delivering his Report of the Chairman during the Board of Governors Meeting, BOMA International Chair Richard D. Purtell, RPA gave personal testimony to why his BOMA membership is more crucial than ever. “BOMA has offered me the opportunity to build my business network and get involved. It has never felt more tangible that I need BOMA now more than ever. The challenges we face are of historic proportions, but our business network is second to none.”
 BOMA Chair Dick Purtell delivers the Report of the Chairman during Board of Governors |
BOMA Chair-Elect James A. Peck, RPA, FMA and BOMA Vice Chair Ray H. Mackey, Jr., RPA, CPM, CCIM delivered the Year in Review address, noting that BOMA solidified its position as a sustainability leader in 2008 by garnering widespread acceptance of the 7-Point Challenge throughout the industry and surpassing 100 endorsers, by publishing the industry’s first green lease guide and by partnering with the Clinton Climate Initiative to launch the groundbreaking BOMA Energy Performance Contracting Model or “BEPC.” BOMA’s response to the current credit crisis was also noted. In 2008 BOMA testified before Congress on the effects of the credit crunch, worked with the Real Estate Roundtable and other industry partners to ask U.S. Treasury Secretary Henry Paulson to take action to help stem the crisis, and launched the “Rx Resource Exchange,” a Web site featuring resources to help industry professionals sharpen their skills and stay competitive.
Peck and Mackey also reported on the many ways BOMA created value throughout the industry in 2008, including the launch of “Foundations of Real Estate Management” to bring core commercial real estate programming to the industry and the formation of the Careers in Real Estate Task Force to address the industry’s growing human capital issues. Advocacy successes were also reported, which literally saved the industry billions. BOMA worked with member and elected officials to claim industry victories on several key issues, including Brownfields remediation, leasehold depreciation and energy efficient commercial buildings. BOMA battled and defeated several onerous proposed codes changes in 2008, saving the industry more than five billion dollars.
During his financial report, BOMA International Secretary-Treasurer David M. Stucky reported that for the fifth consecutive year “BOMA significantly exceeded its budget goal” and continued to strengthen its reserves. Salient financial victories in 2008 included an increase in membership revenue, the most successful year of the Partnership Program, continued growth of the Medical Office Building Conference, a 20 percent increase in advertising revenue for The BOMA Magazine, an increase in companies participating in the National Advisory Council and continued success of the BEEP program. Stucky noted that BOMA has developed a realistic and conservative budget for 2009 that is focused on providing BOMA members with the tools to succeed.
Gordon Hester, chair of the Industry Defense fund Oversight Committee, delivered the report of the Government Affairs committee, where the Board of Governors passed a new policy position allowing BOMA International to actively advocate for policies to ease the capital credit crisis and respond nimbly to other proposals as they arise. The new policy position states: “BOMA International recognizes that our nation faces an unprecedented lack of liquidity throughout virtually every sector of the economy. Policymakers must enact additional measures to energize credit markets and restore bank lending capacity.”
Hester also called on BOMA members to “actively and aggressively unite with us, on Capitol Hill, in the State House and in City Hall,” adding “we need to lead the charge and educate our policy makers on the commercial real estate industry’s contribution to the local tax base, the central role we play in job creation and the benefits of a healthy real estate industry to the overall economy.” He also asked for BOMA members to attend the National Issues Conference in Washington, D.C., March 23-24, to carry BOMA’s message to elected officials.
Immediate Past Chair Brenna S. Walraven, RPA, CPM, presented on the recently launched BOMA Energy Performance Contract (BEPC), developed in collaboration with the Clinton Climate Initiative. BEPC is a pioneering model contract that allows building owners and operators to execute sophisticated energy efficiency retrofits to existing buildings and removes historical barriers to energy efficiency investment in the commercial real estate sector, ultimately bringing greater operational improvements in investment real estate.
Reporting on Regulatory Initiatives, Jim Jonas, chair of the Building Codes & Voluntary Standards Committee, briefed attendees on the recent ICC Codes meeting in Minneapolis. While several onerous codes changes were passed during the codes meeting, BOMA was successful in defeating several proposed codes changes that would have had a devastating impact on building owners, costing the industry billions. BOMA was successful in…
- defeating a blanket 30 percent increase in mandatory energy efficiency in the ICC Energy Conservation Codes
- defeating the NIST/World Trade Center proposed structural, fire and egress changes, and
- avoiding lost rental income by providing alternatives to the NIST/World Trade Center proposals requesting additional elevators in the 2009 Building Codes.
Kent Gibson, chair of the Standard Method of Floor Measurement Committee, reported on current BOMA Standards – “A Unified Approach to Measuring Office Space” in collaboration with IFMA and revised editions of the office and industrial standards slated for release in early 2009. Look for new standards in 2009, including the Gross Building Area standards and initial editions of the retail and multi-residential standards.
Reporting on BOMA’s Research Programs, BOMA Chair Dick Purtell announced the 2008 Experience Exchange Report (EER), included data from more than 5,000 buildings, comprising more than one billion square feet of office space. He also announced the collaboration between BOMA and Kingsley Associates to bring the EER online in 2009.
Purtell also announced the winners of the 2008 EER Participation Awards. The winners are…
 The Board of Governors |
BOMA Locals who achieved the highest overall participation
First Place: BOMA/Silicon Valley
Second Place: BOMA/Metropolitan Washington
BOMA Locals with 300 or more
BOMA/San Francisco
BOMA/Boston
BOMA/Dallas
BOMA Locals with 150 to 300 members
BOMA/San Antonio
BOMA/Fort Worth
BOMA/Oakland-East Bay
BOMA Locals with fewer than 150 members
BOMA/Greater Tucson
BOMA/Jacksonville
BOMA/Sacramento
Dan Chancey with BOMA/Memphis reported on Education and Training, announcing that BOMA launched two critically acclaimed education initiatives in 2008 – Foundations of Real Estate Management and the Sustainable Operations Series (SOS). Foundations was licensed and adapted from BOMA/Atlanta’s original course, PM 101, and was delivered to more than 140 people through seven BOMA locals in 2008. Eight Foundations courses have already been scheduled for 2009 with more locals planning to offer the course. BOMA’s SOS program, consisting of four Webinars, debuted this fall. Like its predecessor BEEP, the SOS program was designed to provide practical, proven, cost-effective strategies for implementing sustainable operations in existing buildings. To date, more than 300 people have participated in SOS courses, and the entire series, along with the “Best of BEEP,” will be repeated in 2009.
BOMA Chair-Elect Jim Peck delivered the Membership report. Peck announced that BOMA had more than 17,200 U.S. federated members for the first time in its history and more than 18,000 cumulative members. He also reported substantial growth in Canadian Members-at-Large and the number of National Associate Members, which now exceeds 100.
Peck recognized 39 BOMA local associations with overall membership growth of more than one percent in 2008 and nine BOMA local associations with principal member growth of more than one percent in 2008.
Mike Coleman, vice president of commercial real estate for AlliedBarton, briefed attendees on the work of the National Associate Member (NAM) Committee, which provides guidance and assistance to BOMA International from the associate member perspective. Coleman reported that the NAM Committee is developing new solutions packages to serve BOMA members given the present economic conditions. In addition, the NAM Committee has started its own quarterly newsletter, plans to participate in and promote the new Corporate Social Responsibility Award and is looking forward to the upcoming Office Building Show in Philadelphia in June where it is hoping to engage other NAMs and exhibitors in a community service project in conjunction with BOMA/Philadelphia.
Steve Ash, chair of the Local Association Services Committee, reported on the role the committee has taken in promoting membership recruitment and retention of young professionals in the industry by developing materials, promoting best practices, and gaining approval of locals to add student members. Ash urged BOMA local associations to submit programs for consideration for the annual Best Practices competition, with the winners to be announced in Philadelphia. He also announced the creation of new membership brochures and flyers under the themes of “Now More than Ever” and “Number One Solutions Provider.”
Marc Fischer, chair of the Careers in Real Estate Task Force, briefed attendees on the work of BOMA’s newest committee, founded in June 2008. Fischer reported that market research indicates that most students and many young professionals don’t even know that property management jobs exist. The committee is reviewing best practices, leveraging resources already in place, and identifying additional needed resources to attract talent from high schools and colleges into the commercial real estate work force.
Other Highlights
During the Opening Luncheon, Jim Tostado, chair of the State Government Affairs Committee, announced the winners of the Government Affairs Awards of Recognition, honoring outstanding work of BOMA Local Associations in advocacy and grassroots education. The winners are…
- BOMA San Francisco in the Outstanding Government Affairs Committee Category for their creation of BOMA-SF-PAC, a political action committee.
- BOMA Columbus in the Single Government Affairs Program or Seminar Category for their rapidly expanding Legislative Committee.
- BOMA California in the Single Government Affairs Issue Category for their rapid response to burdensome and expensive legislative building codes mandates, sponsored by environmental advocacy groups.
BOMAPAC had another successful fundraiser, raising more than $7,000 through the annual golf tournament, as well as golf shirt sales. It was a great start to 2009 as BOMA looks to surpass the nearly $40,000 raised in 2008.
The 2009 Winter Business Meeting was one of the most productive meetings to date at a critical time for commercial real estate. Despite the seriousness of the task at hand, attendees found time to relax, network and share ideas during the Welcome Reception sponsored by Naylor, LLC, where BOMA members mixed and mingled under the beautiful Palm Springs desert sky. Attendees celebrated the accomplishments of the meeting during the Closing Party, hosted by ThyssenKrupp Elevator, where a Hawaiin-themed luau and hula hoop contest (congrats to hula hoop champ Lisa Vogel , BOMA/San Francisco!) provided a fun-filled ending to a successful meeting.
 BOMA members get into the “Aloha” spirit at the Closing Party |
Look for more news and information from the 2009 Winter Business Meeting in the March/April edition of The Boma Magazine.