"We owe our good fortune to Uncle Sam," declared Steven Fuller, professor of public policy and director for the center of Regional Analysis at George Mason University. He, like many others at the conference, which was attended by about 400 real estate movers-and-shakers, attributed to the city's health to the presence of the federal government.
Fuller spoke during an Economist Crossfire, a session moderated by Jonathan A. Schein, president and CEO of Real Estate Media and GlobeSt.com. Also participating in the discussion was Doug Duncan, SVP and chief economist at the Mortgage Bankers Association of America. Speaking on a national scale, Duncan said the impending war with Iraq could have a profound impact on oil prices and, in turn, the economy. "It could take $70 billion out of consumers' pockets and hit business profits as well," he stated. "We need to have a stimulus package."
In a Town Hall-style session moderated by Real Estate Forum editor Cynthia J. Hoffman, the participants expressed bullishness for the DC metro area, even if they admitted the region did not have a stellar 2002.
John Donovan, managing director of CarrAmerica, wondered how poorly other markets are doing if DC is considered so strong. "2002 was an awful year by any standard," he lamented. "Net absorption was 25% of an average year."
Drew Genova, managing director of Trammell Crow Co., cautioned that the city needs more than the GSA. "It can¹t solve all of our problems," he said. "Corporate America needs to be part of our white knight."
William Holmes, senior managing partner at Hart Advisers, told the audience that people in Washington, DC are "spoiled. Look outside of DC. Class A rents in San Francisco are down to $30 a sf."
Before the Town Hall panel, Bruce Mosler, president of US operations for Cushman & Wakefield Inc., spoke about the importance of consolidation in the real estate industry. The topic was particularly pertinent in light of the recent announcement that CB Richard Ellis and Insignia/ESG are about to merge.
"Real estate service firms need to catch up with other industries," he said, in order to reap the benefits of economies of scale that larger firms offer. Combining firms "brings efficiencies to the bottom line," he said.
The morning program ended with Michael Desiato, group editorial director of Real Estate Media, leading an Inside the Real Estate Mind discussion with local developer Douglas Jemal, president of Douglas Development.
Although Jemal seemed to have difficulty discussing his many accomplishments in revitalizing the inner city of the district, he did say that he likes to "take old, dilapidated buildings and put them back together." He is doing just that with the Avalon building, which is scheduled to reopen as a movie theater next month.
Since he started his career by doing downtown retail projects, he said he has no hesitation about inner-city development. In fact, he said that the one area outside of DC that interests him is Asbury Park, NJ, a down-on-its-luck New Jersey shore town that is scheduled for urban revitalization.
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