CHICAGO- Over 600 people attended yesterday's 2013 Global Real Estate Summit convened by DLA Piper at the Four Seasons Hotel in Chicago and most agreed that political gridlock in Washington, D.C. continues to threaten the economy.
But many attendees at least found some common ground on what they wanted to see happen. Jeffrey D. DeBoer, the president of the Real Estate Roundtable, led a morning session on politics and asked a collection of industry leaders how politicians could best improve the fiscal position of the U.S.
“I'd prioritize jobs,” said Timothy H. Callahan, the chief executive officer of Callahan Capital Properties. John C. Cushman, the co-chairman of Cushman & Wakefield, wanted politicians to focus on a range of issues like jobs, tax reform and entitlement reform, but Henry G. Cisneros, the executive chairman of CityView and former HUD secretary, came out strongly for a singular focus on “whatever it takes to generate growth, defined as jobs.”
And although the controversy over immigration reform may strike some as peripheral to the world of commercial real estate, all of the panelists agreed that settling the contentious debate could improve the overall health of the economy. “This is all about human capital,” said Cushman, especially since the controversy also ensnares “the people who work at CalTech and Stanford.” He also strongly opposes any attempt to repatriate the nation's millions of undocumented immigrants. “I'm with Paul Ryan,” he added, the influential Republican congressman who recently endorsed comprehensive immigration reform.
“It's a hopeful time,” Cisneros said of the possibility that Washington will break through the gridlock on at least this issue. “This is not by any means done,” he cautioned, since some members of Congress have started expressing reservations about comprehensive reform, preferring instead some limited actions. “Everyone who cares about this issue needs to let their voices be heard.”
The panelists also expressed optimism that Congress and the President will agree to reform the Foreign Investment in Real Property Tax Act of 1980, enacted when Americans were panicking over the foreign ownership of real estate. “We think we have to change that mindset,” said Callahan, because it blocks needed investment. Under FIRPTA, the government taxes foreigners on gains from the disposition of U.S. property interests. “There is certainly a lot of global capital assembling,” Callahan added, and it will “go somewhere, so why not the U.S.?”
In March, President Obama proposed a reform of the FIRPTA during a speech in Miami, said the Roundtable's DeBoer, including treating foreign pension plans the same as tax-exempt domestic plans. The proposed reforms “come directly out of a meeting we had with White House officials.” However the proposals fare on Capitol Hill, DeBoer considers it a sign of remarkable progress that “the President has now said FIRPTA is a problem.”
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Brian J. Rogal
Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.
