A Message From NAIOP

House leaders took a significant step forward with tax reform efforts on Thursday with the release of the Tax Cuts and Jobs Act, H.R.1, which includes an expansive set of propsed changes to the corporate and individual tax system. In this proposal: Section 1031 like-kind exchanges are preserved for real estate. Current tax treatment of carried interest is preserved. Deductibility of interest on debt is maintained for those involved in real property trades or businesses, including commercial real estate development. Current eight individual tax brackets are condensed into four brackets: 12 percent, 25 percent, 35 percent and 39.6 percent. The top rate of 39.6 percent would apply to income lev

Out of Land AND Roads

We continue to see positive net absorption for Industrial warehouse space across the Greater Portland Marketplace. 3rd Quarter experienced almost 900k sf of absorption, for more than 2.5M sf of absorption through the first three quarters. This already surpasses my estimate for all of 2017, which I pegged at less than 2.5M sf of absorption. And I doubt 4th Quarter will go negative, so the underlying strength of this recovery continues onward. New deliveries total just over 2M sf through the first three quarters, with a little more than 1.0M sf delivered in the 3rd Quarter. A significant portion of this space (700k sf) was the three building Vista Logistics Park in Gresham, billed as the l

Is "As-Is" Really "As-Is" in Real Estate Contracts?

The historic concept of “caveat emptor” (let the buyer beware) permitted a seller to shift the obligation to the buyer in a real estate transaction. Many states have altered that rule over the years to place a greater obligation on the seller, while still largely leaving the risk on the buyer in commercial transactions. In Oregon for instance, the courts generally allow parties to a real estate deal to allocate the risk as to the property by enforcing “as-is” clauses. The courts focus on two key aspects when looking at seller’s liability: first, if the contract does not contain an “as-is” clause then seller’s misrepresentations - even if innocent - are actionable, and second, if the contr

When will interest rates go back up? How about never!

When will interest rates go back up? In the back of the minds of most commercial real estate investors is the never ending question, “When will interest rates go back up?” We have collectively fretted over rising interest rates for the past 35 years. And yet the truth is this: Those who have locked in long-term interest rates over the years have been the big losers. It would have been in the borrowers’ best interests if they had chosen a short-term variable rate or even a five-year fixed rate than to have locked in a 10-year fixed rate loan or longer. Thinking rates certainly have to go back up, those who locked in the longer fixed term rates over the years have consistently paid larger m

2017 New Oregon State Legislation Signed by Governor Kate Brown

SB 277 Increases notice period for termination of rental agreement and removal of manufactured dwelling or floating home. SB 311 Authorizes city or county to adopt ordinance or resolution providing property tax exemption to commercial, industrial and multifamily buildings built before January 1, 1993, that will be seismically retrofitted, for period not to exceed 15 years. SB 381 Requires certain notices related to real estate loans to be mailed to all addresses on file for recipient, including post office boxes. SB 677 Establishes standards for establishment of cider businesses on land zoned for exclusive farm use or on land zoned for mixed farm and forest use. SB 769 Provides that person m

Ditching Digital Distractions

As the fast-paced real estate business becomes more mobile, your smartphone and other devices can be your best friends—but they can also fill your day with interruptions. You can be bombarded with emails, text messages, phone calls, and social media notifications. Digital distractions can get in the way of being effective at your job and living your life to its fullest. “Technology is making us connect more often within shorter amounts of time,” says Larry Rosen, professor emeritus and research consultant at California State University, Dominguez Hills, and co-author of The Distracted Mind: Ancient Brains in a High-Tech World (The MIT Press, 2016). Technology has set an expectation for an im