Scotsman Guide - January 2009 Commercial Edition

Stephen Renna

PRESIDENT

National Association of Real Estate Investment Managers

By Jennifer Landree

As the National Association of Real Estate Investment Managers gears up for its annual symposium this month, we caught up with association President Stephen Renna. He discusses the evolving economic and investment conditions and where brokers can find opportunities this year.

How does the investment space look right from real estate investment managers’ perspective, considering stock market volatility and lack of liquidity in the credit market? The liquidity crisis right now is at an acute phase, and liquidity is basically frozen. As a result, credit flows are almost nonexistent. This is an unprecedented time for the economy and anybody that requires credit — which is virtually anyone. We’re going through a massive deleveraging as a result of this liquidity crisis, and that deleveraging is resulting in a massive devaluation of assets throughout the economy.

How are your association’s investment-manager members reacting? Our member companies have to reassess this new landscape to determine how they need to refocus their investment strategies going forward. [They] are trying to mine different types of opportunities that exist in this environment — and there are opportunities.

This is not a normal functioning period for the industry and for the economy. [Real estate investment managers] are trying to reassess. “How do we adapt to this environment? What do we do once normalcy in the credit markets begins to return?”

What advice do you have for mortgage brokers trying to keep deals alive and find investors? I think whether you’re on the mortgage-broker side or you’re on the investment managers’ side, you’re looking for the same thing in the markets. You’re trying to find those markets that are most-balanced from an economic standpoint. You’re looking for opportunities, and you’re looking also to be creative. And certainly those who have the cash on hand to be able to invest will be in the best position to invest when you get more of a return to normalcy in the credit markets.

I think that mortgage brokers are going to have to try to look at opportunities similarly and try to figure out, “Where can we play in this new environment? Where can we provide mortgage-brokering opportunities to borrowers?”

In the future, will investment managers and mortgage brokers work together more often? I think in order to function in this environment, it’s going to take collaboration. It’s going to take a number of parties being involved in transactions to make them work.

Real estate investment managers are not only advising investors where to put their investment allocation in real estate, but they’re also actually managing the asset. They know the assets very well; they’re not just investing in them from afar. And that knowledge of the asset would be an important source of information for mortgage brokers as they’re looking to finance their property.

Jennifer Landree is a Seattle-area freelance writer. For questions or comments, e-mail articles@scotsmanguide.com.

… in February’s Scotsman Guide

Find out about creative-financing techniques, as well as: ^F⁵ ^Years ^Agorom January 2004’s Scotsman Guide

Next Month

■ What to know about helping clients with sale-leasebacks

■ How the market downturn has affected the SBA

■ Where Salt Lake City’s commercial market is headed

… and much more.

“Second-mortgage lending is traditionally a hazardous business, and for the holders of this paper, Murphy’s Law certainly applies: ‘Whatever can go wrong will.’ … It’s not a field for the faint of heart or the weak of knees.”

 A.B. JACOBS, Premier Investors

“Second-Mortgage Apartment Financing”

scotsmanguide.com/0953

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Helping Hands
Each month, Helping Hands features a
mortgage professional or group that has
volunteered to lend a hand to others in need

By Ivanna C. Sukkar

Name Susan Howe, director of marketing, Newland Communities

Project Third-annual Life is good Pumpkin Festivals Sites Nationwide

How For the third-straight year, land developer Newland Communities partnered with clothing and accessory company Life is good Co. to host fall pumpkin festivals across the country. This year’s festivals, held at eight New-land-developed communities this past October, featured pumpkin-carving, face-painting, food and games.

With some help, Tai Ogletree carves a pumpkin this past Oct. 25 at the San Diego Life is good Pumpkin Festival. Photo: Newland Communities

Each year, the pumpkin festivals’ proceeds — raised primarily through sales of Life is good Co. merchandise at the festivals — go to the Life is good Kids Foundation. The foundation then donates the funds to nonprofit organizations that help children in need.

This year’s festivals drew anywhere from 800 to 15,000 attendees each, Howe says. They were held in Rocklin, Calif.; San Diego; Tampa, Fla.; Ruther Glen, Va.; Clarksburg, Md.; Flowery Branch, Ga.; Goodyear, Ariz.; and Katy, Texas. The festival in Rocklin occurred on Oct. 18; the others were on Oct. 25.

Why The idea for the Life is good Pumpkin Festivals came when Newland Communities president LaDonna Monsees met Life is good Co.’s CEO, Bert Jacobs, at the 2006 Vine Conference, which focuses on the nature of community, Howe says.

According to Jim Laughlin, director of communications for Life is good Co., the two company leaders had “a shared belief in building communities of value and in corporate social responsibility.”

Because the two companies also had various individual festivals, Howe says a partnership made “immediate sense.”

Try it newlandpumpkinfestival.com

Impact For the past two years, festival funds benefited HomeAid and Project Joy, Laughlin says.

HomeAid ( homeaid.org) provides transitional housing for homeless families; Laughlin says the festivals’ proceeds target homes for families with children. Project Joy (pro- jectjoy.com) is dedicated to helping impoverished children impacted by violence, loss or other traumatic experiences.