Vision for greatness ahead for St. Louis

St. Louis commercial real estate should be headed for great things in 2021, judging by insights provided in “Greater St. Louis and a Vision for Greatness,” a March 9 Retail Spotlight Shift webinar from the St. Louis CCIM chapter.

Tiffany Wiegers, 2021 president of CCIM STL, kicked off the event by thanking sponsors as critical to providing services and resources for the chapter and announcing that scholarships are available for upcoming courses (details are on the CCIM STL website).

Events hosts were Tony Kennedy of Colliers International and Tom Ray of CBRE.

“This is a timely and important discussion about the future of our region,” said Greater St. Louis, Inc. founder and CEO Jason R. Hall, in describing Greater St. Louis Inc. as a combination of five organizations (AllianceSTL, Arch to Park, Civic Progress, Downtown STL, Inc. and the St. Louis Regional Chamber) aiming to reduce historic fragmentation and create one united voice.

“We have to make a decision that we will be a community on the rise or on the decline. We need the same vision, same tenacity, same energy (as in the sports sector) to grow the region.”

“Greater St. Louis brought together eight key growth initiatives from day 1 (January 1, 2021),” Hall said. “It’s all about jobs — retain, attract and create; elevate our regional reputation; and advance common goals. The urban core is essential.”

Among the positive indicators,  St. Louis has seen $8 million in commercial real estate during the pandemic.

“And that has continued to grow. St. Louis can be a global leader in biotech and agtech,” Hall said.

An important example is the 1,400 new jobs coming with Accenture. Other encouraging signs are redevelopment of the Butler Building, which has been one of downtown’s largest vacant buildings, and Green Street Workforce Housing, a partnership for “one of the largest inclusive housing projects in The Grove.

Such place-making projects have a huge impact on bringing business and residential growth to St. Louis.

“We are coming together as a geospatial center of excellence, with a long-term plan in place,” Hall added.

Hall cited entrepreneurship as another incredible force in being re-energized.

“St. Louis is launching new businesses and is first in the country for women-owned businesses,” he said. “We are aggressively back in business.”

Hall quoted Entrepreneur magazine as recently saying that “St. Louis is on the precipice of leading the United States in 21st-century innovation.”

While the St. Louis area hasn’t had a basic jobs plan for more than a decade, “we are now the only metro area to develop one in terms of the pandemic and the new civil rights movement,” Hall said.

“We have to drive inclusive growth. We have got to focus on inclusive growth and close spatial and racial gaps.”

Greater St. Louis is funded by private sector business as investors, and “the business community has to be much more engaged to make (our vision) a reality,” Hall noted.

“We have to make St. Louis better overall and understand the perception of St. Louis in the country. We started STLMade as a way to shine a light on the positive and tell our own story. We will take the story national. It’s a people-centered, data-driven approach.” 

In line with such efforts, the AllianceSTL partnership aims to “accelerate growth by recruiting new jobs and business investments to the 15-county bistate St. Louis region,” according to Chief Business Attraction Officer and president Steven S. Johnson.

“We have an exclusive external focus on business and economic development,” he said. “Our key audiences are site selectors, real estate developers and companies in our main targeted verticals: manufacturing and production; financial and information services; bioscience and health technology; geospatial; agtech; transportation and logistics; and the aerospace, automotive and defense industries.”

Many of those targets are in local commercial real estate because of their current work in location services, Johnson noted.

The Alliance is using social media and related advertising along with traditional advertising to those primary key audiences, along with individual outreach and relationship-building. Marketing is essential — a lesson that St. Louis is learning from cities like Austin, Texas. “Many of the markets we admire have been marketing business attraction for decades.”

Typical projects for the Alliance include “straight-up business development to attract companies and headquarters to St. Louis,” which represents 80% of its focus. Such companies are generally new to the area or have no St. Louis presence yet. Cooperation is vital: “We work with economic development partners; we can do nothing by ourselves,” Johnson said.  “Our relationships and partnerships are as strong now as ever, and that is good for St. Louis.”

To build on those connections, “we ask businesses exactly what they’re look for.” The answer is usually “talent availability and sourcing, business continuity, and the cost of labor. “We are finding that location is as much about mitigating risk as anything else,” Johnson said.

Agriculture technology is another important business sector for St. Louis, thanks to its central location and accessibility to a huge resource of agricultural producers, according to Thad Simons, founder and managing director of The Yield and The Yield Lab Institute, a “cooperative network of venture funds to advance food and agriculture technology globally,” with companies in Ireland, Argentina, Brazil, Chile, Singapore, France and Luxembourg.  The lab is the company’s nonprofit arm.

When he came to St. Louis in 2014 for a three-year assignment with Monsanto, “I was curious about the agtech space,” Simons recalled. “I realized the difficulty of getting projects off the ground. Part of the problem was understanding what ‘agtech’ means.”

With agriculture as one of the largest elements of the geospatial sector, the advantage for St. Louis is that it is “right in the center of agricultural production and distribution. The strength we bring is less the money that the connections,” Simons said. “The impact of the agriculture sector on St. Louis is tremendous.”

While many large organizations already have a local presence — the largest associations for farmers are all based in St. Louis, “we mentor smaller companies to come to St. Louis.” There is still a need to “find champions of St. Louis and stay in touch with them,” Simons said. He is encouraged by the expectation that “there will be lots of stories of companies coming here through word of mouth.”

Simons sees St. Louis as a “really hot space” that is “fostering research and technology.” Of the company’s 50 global projects, 12 are in St. Louis. Driving new investment and presence in the area are projects and innovations that go beyond traditional uses of agricultural products, such as a commercially viable indoor farm and “a small-scale project along Delmar to address food deserts” (the absence of grocery stores). “It’s intended to be for-profit, so we will sell products to restaurants, but also donate to the community,” he said.

Now getting started in St. Louis is a NASA Challenge to investigate “how growing food in space can relate to growing food on Earth,” Simons added.

While Simons is optimistic about business growth, he sees a need for expanded investment. “St. Louis is strong and getting stronger in human capital, but still not where we should be in financial capital,” he said. 

The hemp industry offers the prospect of growth as an alternative protein and in oils and nutrition, once regulation and legality are in place.

Looking ahead

For St. Louis business and commercial real estate to succeed, it is crucial “to be thinking five, 10, 20 years ahead to create self-perpetuating environment in geospatial and build up an innovation ecosystem,” said Hall. “That will give St. Louis a durable advantage.”

Asked about the impact of a new mayor on commercial real estate and business, Hall said the upcoming mayoral election is a “generational change; both candidates are speaking about growth  and the need for inclusional growth. It’s an exciting time for St. Louis. Magic happens when we have public and private alignment. There will be exciting opportunities to work together.”

“We seem to have two candidates who will be very hands-on and pro-development. We will work with everybody,” Johnson said.

“Whoever becomes mayor will have to realize that there is an urban-rural divide, and a need for much better understanding between those segments of the region,” Simons said.

A recording of the event is available at https://www.linkedin.com/company/ccim-st-louis-metro-chapter/ or

https://www.youtube.com/channel/UCO2uJM-RnLRetiKTNvYAUVA.

IREM asks 'Where will you go in CPM?'

The pandemic hasn’t stopped the Institute of Real Estate Management (IREM) St. Louis Chapter from providing skill-building resources to area real estate professionals, as several dozen colleagues learned in a February 10 webinar about the process for achieving the Certified Property Manager® (CPM) designation.

The program brings the IREM slogan of “Where will you go in CPM? Anywhere you want” to life and fulfills IREM’s mission to “provide what real estate managers need to succeed and tackle their jobs.”

”The benefit of the CPM is that ‘it’s all-encompassing.’ It teaches to all aspects, not just residential, commercial or industrial. It’s about learning across all aspects,” said Lizzie Ortolano, event host and IREM St. Louis’s senior director of customer and member experience.

The program includes courses in asset analysis, accounting, marketing and leasing, leading a team, maintenance, and finance, with ethics as a core component and principle.

“It’s a 360-degree approach to success,” Ortolano said.

Certification is a four-step process:
• Enroll, which takes about 10 minutes

• Learn, 12 to 18 months

• Test, 3 days to a month

• Graduate

The average cost is $7,500–$8,500, which includes IREM dues; local chapter dues can “vary significantly.” Costs kick in at various points in the process, from $425 to enroll to $210 for graduation, and can be offset for a REALTOR® or affiliate REALTOR®.

Courses are $400–$600 each and scholarships are available for IREM members, one of which covers 75% of the cost for up to three courses; a member can reapply for the scholarship after using it the first time. Someone who fails to graduate can re-register at 50% off the cost and try again.

IREM’s Fast Track approach provides further savings, at a price tag of $950, by waiving seven of the eight courses (the ethics course is required, no matter what) for those with a college degree in property  management or real estate, designation from an approved industry organization, or 20 years of qualifying real estate management experience. Fast Track participants still have access to all course materials.

The process is flexible, Ortolano said, with no time limit on how long it takes to earn the CPM designation, although there are deadlines once registered for an exam — or capstone — date. She suggested setting exam dates when registering for the program overall. The eight certification courses should be taken in a recommended order, with the ethics segment usually the first step. Although usually a classroom, in-person offering, an online version of the ethics section is available through December 31, 2021, because of the pandemic.

The handbook, which provides a “deeper dive” on course content, can be downloaded from the IREM website and goes beyond study material. “It includes information you can use to convince management of the value of certification,” Ortolano said.

Real estate management professionals who have taken courses or other certification programs don’t have to retake them; “credit doesn’t expire even if you took a course and didn’t complete certification, and can go back several years,” she said.

There are three current modalities for the coursework: virtual classroom via Zoom, led by an instructor; in-person classroom session with an instructor; and online, self-paced. Each course ends with a 50-question open-book exam.

Requirements to maintain CPM candidacy include being current with IREM dues, documenting 36 months of real estate management experience and attending at least two chapter meetings (although that can be waived in the current pandemic era). For commercial real estate professionals, qualifying experience includes a minimum portfolio size of 120,000 SF at one site or 80,000 SF at two or more sites, and serving in at least 19 of IREM’s 36 key management functions.

A real estate license or REALTOR® or affiliate REALTOR® status might be required to complete the CPM process. Because IREM is part of the National Association of REALTORS® (NAR), NAR membership is also a requirement.  

Recent innovations in response to COVID-19 issues, Ortolano said, include a digital badge that is unique to each individual who graduates and holds the date CPM status is achieved, what the individual did to earn the designation and more.

“Many chapters are doing creative virtual installation celebrations for their new CPMs until it is considered safe to hold such events in person again,” Ortolano said.

For more information, go to www.iremstl.com.

Collaborative action key to city vacancy concerns

Last week ULI St. Louis hosted “Starting Where You Are: Collaborative Planning Around Vacancy in the City, “ a virtual presentation moderated by Cecilia Dvorak, AICP, city planning executive with the City of St. Louis.

Presenters included Laura Ginn, vacancy strategist for the City of St. Louis; Bob Lewis, assistant professor of urban planning at Saint Louis University; and Sundy Whiteside, board president of the St. Louis Association of Community Organizations.

The program began with a few relative stats. First: Vacant property in St. Louis adds up to approximately 2,500 acres, 7,000 buildings and 13,000 empty lots.

Second: St. Louis ranks third in the United States for city vacancy. If a line were to be drawn at Delmar Boulevard, the northern portion of the city would have the highest concentration of vacant properties in the country.

Next: The impacts of highly-concentrated vacancy range from lower property values and increased illegal dumping to higher rates of drug and gun-related crime.

“Where there is a high concentration of vacancy, there are also challenges - like a lack of access to public transportation and technology, poverty, housing cost burdens, increased amounts of lead poisoning and asthma,” Ginn said.

As a city, St. Louis is taking a comprehensive, thoughtful and collaborative approach to rebuilding a more equitable community - starting with the organized group (of which all the presenters are involved), called St. Louis Vacancy Collaborative.

The Collaborative launched in 2018 and is made up of more than 40 organizations, twelve city departments, hundreds of volunteers and committees, and six working groups (Anti-Displacement, Data Analysis, Marketing & Engagement, Reinvestment & Reuse, Stabilization, Maintenance & Demolition, Vacancy Prevention).

Another stat presented: 60% of vacant property is privately-owned, which presents many challenges in reinvestment and stabilization. As public organizations work to care for the approximately 40% of properties under their ownership, they are also working to hold vacant landowners accountable for the condition of their property.

“Of crucial importance to this initiative is the redevelopment of vacant properties. We can clean them up and preserve the buildings, but ultimately we need people to invest in the urban core,” Lewis said.

Over the last few years, the City of St. Louis has launched multiple efforts to encourage investment in these areas, including Proposition Neighborhood Stabilization (NS) and the Gateway Neighborhood Fund (GNF).

Proposition NS has created funding for the city to stabilize properties within their land bank to not only improve public safety, but also to encourage development.

GNF has made provisions for approved homebuyers looking to purchase and improve homes in areas where there is an appraisal gap. Enabling home buyers to purchase and renovate these homes helps to increase their value and encourages investment in distressed neighborhoods.

Substantial time has been devoted to reforming property tax foreclosure procedures. Tax foreclosure on home owner occupied properties is not only devastating to the residents, but to the neighborhoods as well.

Two of the Collaborative’s recent efforts to prevent displacement and vacancy are the Real Estate Property Tax Assistance Fund and the Home Repair Network & Fund.

“Tax assistance and home repair assistance help fill local budgets, prevent an increase in vacancy, stabilize neighborhoods and protect home owners facing economic hardship,” Whiteside said.

Should tax foreclosure be necessary, the Collaborative is working on reformation to bring properties to auction sooner so that the community will not suffer from an unoccupied, and therefore untaxable, neighboring property.

“Many people don’t see and recognize the importance of building relationships, but engaging communities and neighborhood residents in the process is how we build a better city. The plans we’re developing help people have a hope for the future.” Whiteside said.

The Collaborative is always looking for volunteers, you can use this link to learn more about the working groups and how you can get involved.

If you would like to view the full program, a YouTube recording is available here.

Current Chesterfield development on par with 2019

This week’s CCIM St. Louis Metro Chapter virtual luncheon presentation provided solid insight to the development of the Chesterfield, Mo. area.

With presentations from Mike Geisel, city administrator with the City of Chesterfield; Tim Lowe, VP of leasing and development with The Staenberg Group; and Jeff Tegethoff, operating partner of CRG, attendees received a comprehensive look at the future of the city.

Geisel started the presentation by introducing “Envision Chesterfield,” the city’s comprehensive plan completed through a 21-month process which was adopted in September of this year.

Data shows that the city of Chesterfield has grown at 2.6 times the rate of inflation. With 44 active development projects, the city is on par with 2019 numbers despite the challenges of 2020.

“In the last ten years, we’ve seen 2,300 residential units being developed. We’ve seen 3.9 million SF of commercial development and 650,000 SF of industrial development,” Geisel said.

The District and Wildhorse developments are two large components contributing to the current success in Chesterfield, according to Geisel.

Working from the opportunity of their neighboring tenant TopGolf, The Staenberg Group is developing The District - previously an old outlet mall - into a new entertainment area. The revitalization has recently handed over the 48,000 SF shell to their new tenant, Main Event, set to open in June 2021.

On the other end of the property, The Factory, the first built-from-the-ground-up live music venue in the Midwest in more than 20 years, is currently underway. Lowe acknowledged the risk of this type of facility in the current COVID climate, but also noted the high demand from both fans and bands.

“We’re excited. This is going to be a unique draw to the area. They’re planning to open in May of next year. While the current guidelines would not allow The Factory to open and be successful, the good news is that there is a lot of pent-up demand for next year. We are hoping the rules of engagement in 2021 will allow us to open and be functional,” Lowe said.

Phase 2 of The District will feature an open-entrance, steel structured pavilion which will serve as an eye-catching anchor of the development.

“We have a lot of work to do to figure out what goes under the pavilion, but (we) will have grass, fire pits and outdoor seating. It’s a neat area within the development that allows people to read books, play with their kids, things like that,” Lowe said.

The final phase of The District is currently being planned. At this point, potential activities include indoor and outdoor pickleball, sand volleyball and eSports.

Lowe also mentioned the Chesterfield Mall, which The Staenberg Group is currently working on a master plan to convert the property into an urban downtown development. The plan includes housing, office, retail, and restaurants, and is scheduled to be completed and presented to the city by the end of the year.

Tegethoff also shared his vision for the existing Wildhorse project and Wildhorse Village. Wildhorse has scheduled openings throughout 2021, including the 188-residential spaces in March and the AC Hotel by Marriott in December. The notable, 15,000-SF Ruth Chris Steak House opens in two-weeks.

Wildhorse Village, an 80-acre development to include 1 million SF of office space, more than 500-residential units and 100,000 SF of restaurant and retail space, is currently underway. The project will not be phased and anticipates openings as early as 2023.

“We never really thought about phasing Wildhorse Villiage. The momentum of early interest in the sub lots enabled us to do it all at one time,” Tegethoff said.

“We feel like there has never been a more exciting time to developing in Chesterfield.” Tegethoff said.

Despite the challenges of 2020, the city of Chesterfield is on the rise.

to view the entire program, please visit CCIM St. Louis’s LinkedIn page.

CRE study prompts gender and diversity call to action

Last week CREW Network CEO, Wendy Mann, CAE, unveiled to CREW members via Zoom the findings of CREW’s 2020 Benchmark Study Report:  Gender and Diversity in Commercial Real Estate. 

CREW has conducted benchmark studies every five years commencing in 2005 to measure the progress of women in commercial real estate.  This year’s study introduced new questions to examine diversity, equity and inclusion and workplace culture. The study also gathered country-specific data for Canada, the United Kingdom and the United States. 

In conducting the study, CREW partnered with the MIT Center for Real Estate. The study was conducted between January 2 and March 31; and 2,930 industry professionals across all commercial real estate sectors participated. 

The study revealed that women occupy 36.7% of the commercial real estate industry, and this percentage has remained fairly consistent over the past 15 years.

“There’s not ben a lot of adding in, we haven’t grown in terms of gender in the industry,” said Mann.

The study also revealed that even though the industry has not attracted more women, there have been some strides. More women occupy brokerage positions than ever before (29%), which represents a 6% increase from 2015. And, the percentage of women aspiring to C-suite positions (32%) rose by 4% since 2015.

“I think what’s really interesting and notable is that women under 40 were more likely than women over 40 to aspire to the C-suite based on the study. This is something we’re going to have to watch over the next few years,” said Mann.

The study also showed that women continue to be less likely to achieve the top positions at their companies than men. Women occupy only 9% of C-suite positions in commercial real estate.

The 2020 study confirmed that there still is a substantial compensation gap between women and men in the industry. Women earn 10% less than men in fixed base salaries. The study further revealed that the women who participated in the study overall earned 56% less than men in commissions and bonuses. The gaps for both base salaries and commissions and bonuses were even wider for Black, Asian and Hispanic/Latina women. 

Mann noted that in past studies, the data showed that women and men entering the industry start out at approximately the same compensation levels; however, the 2020 study revealed a 9% compensation gap at the entry level between genders. 

“Here we’re seeing for the first time a 9% gap in where men and women are starting out, and that is very disturbing. So that, for me, is going backwards instead of forward,” said Mann.

Mann noted that the gap widens as the industry professionals advance up the career ladder. The compensation gap between women and men is highest at the C-suite level (33%).

The 2020 report revealed that women’s career satisfaction and perceptions of success decreased to its lowest point in 15 years across all industry specializations, while men’s perception of success has continued to increase since 2010. 

Mann noted several possible reasons for women’s growing dissatisfaction with their careers. 

“If women are receiving lower pay, they feel like they have fewer opportunities for upward mobility and less access to leadership roles. They could be growing increasingly frustrated at being unable to reap the financial benefits of an industry where really the sky is the limit if you work hard and you have great opportunity and access,” Mann said.

Approximately 60% of the 2020 study respondents reported that their workplace is “not very” or “not at all” diverse. However, more than half of the respondents reported that they are beginning to see a culture shift within their companies regarding diversity, equity and inclusion, a result of mandates from leadership and external industry pressures.

“I think for a long time executive leadership in commercial real estate didn’t embrace diversity as a business advantage. But, we know now not just from our studies, but from other studies, that the inclusion of different people based on gender, race, ethnicity and sexual orientation is a business advantage, and that to increase diversity, equity and inclusion, leaders need to continue to understand what the issues are that we revealed in this study, and we need to resolve them. This is no longer a ‘nice to have’ or it’s a ‘good thing to do’ —it’s a business imperative,” said Mann.

Mann said that the findings of 2020 study, which revealed almost no progress for women or Black, indigenous and people of color in the commercial real estate industry, are a call to action. 

“Here’s your call to action leaders of companies. The fish rots from the head down. If you are at the top of the organization and not committed, it’s not going to happen. Top leaders must be invested, involved, measured and held accountable for diversity, equity and inclusion in a company,” said Mann.

Mann concluded by asking those who are not the company leaders to share the study with company leaders, human resource officers and fellow employees. 

“Make this a point of conversation throughout the company,” Mann said.

The study can be found in its entirety under the Industry Research tab at www.crewnetwork.org.

CRE project designs 'on point' for future

The evolution of commercial building design over the last few years to include more open space, rich amenities, safety and tech-driven concepts is proving to be a well-thought-out and timely choice, especially when considering the current and future demands and regulations resulting from COVID-19.

Building spaces, notably office and other shared spaces, are in the spotlight now more than ever before, prompting the focus of discussion for the St. Louis CCIM virtual meeting last week.

Tony Kennedy with Colliers International, moderated the meeting; panelists included Larry Chapman, president and CEO of Seneca Commercial Real Estate; Korey Baker, associate director of market development for Compstak; Toby Heddinghaus, president of Gray Design Group; Scott Haley, managing director of US Capital Development and Tim Gaidus, senior project designer at HOK.

“When Seneca embarked on the Edge series of buildings, the focus was on creating an environment that employees want to be a part of, which in turn, helps the companies that become our tenants compete successfully for, and to be able to retain the best and brightest talent. These designs easily adapt to the changing demands of the occupants and are highly compatible with the new COVID-19 paradigm,” said Chapman.

Edge at West Park, located just west of the I-270/Olive Blvd. interchange, provides a flexible, employee-centric environment which maximizes the building’s common areas to provide amenities critical to helping companies recruit and retain the best talent, regardless of market conditions. FM Global, a worldwide insurance company based at Maryville Centre Office Park, is set to move into the top floor of the four-story building in November.

“Edge at West and Forsyth Pointe are two of the more prominent office developments planned in St. Louis County right now. With some uncertainty in the market surrounding COVID-19, it's refreshing to see these projects advancing on schedule. I'm very confident that US Capital Development and Seneca will deliver top quality buildings to the market that adapt to the needs of the users, both in terms of the current pandemic and also their long- term ability to recruit and retain top tier talent, “ said Jim Loft, president of St. Louis CCIM and executive vice president of Gershman Commercial Real Estate.

The recently completed EDGE@BRDG (BioResearch & Development Growth) Park, an innovative 160,000 SF, four-story lab and office building on the Donald Danforth Plant Science Center campus in Creve Coeur, Mo., is now finished and its first lead tenant, Benson Hill Biosystems, one of the fastest growing leaders in the field of plant sciences, has just moved in.

Forsyth Pointe, located on Forsyth Blvd. between Brentwood Blvd. and Meramec Ave., consists of two towers totalling nearly 1million SF of space, half of which will be dedicated for office use and the other half to a 1,250-spot garage. The west tower is slated to have 202,054 SF of space across 14 floors and the east tower to have 255,114 SF of space across 16 floors, two floors of which will be for the underground parking garage. Over 24,000 SF of retail is planned.

Other forward- thinking design elements mentioned that are currently being implemented in building design include:

• Walkable environments- fresh air spaces with plenty of distance

• Wide open staircases

• Refuge areas

• Phone booths

• Huddle rooms

• Roll up (garage) doors

• Touchless automatic door opening

• Restroom doors with no handles

• Plasma filtered air

• More robust cleaning services

• Anti-microbial coatings

• Hand sanitizer stations

• Biometrics instead of touchpoint

• Robotics and automation

• Holograms/virtual reality

The next St. Louis CCIM event is scheduled for September 15th from 11:15 am - 1:00 pm at the St. Louis Club in Clayton, Mo. For more info, please visit https://ccimstl.com/events/.