John Morris was named leader of industrial services for the Americas at Cushman & Wakefield.
Morris succeeds Jim Dieter, executive vice president and current head of the service line. Dieter will remain with Cushman & Wakefield through 2013.
Morris, currently the leader of Cushman & Wakefield’s Global Business Consulting service line, joined the commercial real estate services firm in 2005. He has extensive experience in network and location strategy for industrial operations and a broad background in supply chain strategy, network design, cost reduction and transportation operations, and has worked with many Fortune 500 companies.
NREI connected with John Morris to talk about the new challenges facing the industrial sector, what customers are demanding now and how the sector has fared in the economic downturn. An edited version of that interview follows.
NREI: What is one of the major issues in the industrial sector that you're facing now that you were not facing, say, two or three years ago?
John Morris: We’re seeing significantly slower decision processes. A process that once took a couple of months for a client now seems to take two or three times longer. The economic recovery has been unstable and inconsistent and clients and investors hit hard by the previous down cycle have adapted their decision processes accordingly. There is still the occasional fast-track project, but those are fewer and farther between.
There is also an unevenness in availability between tier-one markets—Chicago, Los Angeles, New Jersey, Pennsylvania—and smaller tier-two and three markets, and between medium-sized (250,000-sq.-ft.) and big box (850,000-sq.-ft.) distribution centers. There is a scarcity of the larger boxes in tier-one markets and significant availability of mid-sized boxes, particularly in non-Tier 1, and that unevenness is compounded by significant variances in absorption rates by market right now.
NREI: How do customer demands differ based on geographic location—what do customers want in the Southwest, for example, that is different from, say, the Northeast?
John Morris: In a more urban, highly congested market, which is often the case in the Northeast, there is greater concern for proximity to customers and for facilities with a likelihood to avoid more congestion. There’s a greater focus on saving transportation time in those markets than elsewhere. Also, with the phenomenon of re-shoring and more domestic manufacturing requirements, 90 percent of the requirements we see that involve manufacturing and light assembly right now are interested in going to the Southeastern U.S. The lion’s share—95 percent—of the requirements we’re involved with in the Northeast, or in the Southwest—New Jersey, Los Angeles and Phoenix, for example—are bulk distribution.
NREI: How does outsourcing continue to affect the sector?
John Morris: Outsourcing to third-party logistics companies continues to grow at an accelerated rate. Third-party logistics was a $31-billion industry in the U.S. in 1996, and for 2012, it is on target to be nearly a $150 billion industry. Percentage-wise, third-party logistics revenue has grown from seven percent of logistics spending at the beginning of the decade, to about 12 percent in 2012. Interestingly, the growth rate was faster in 2001-2002, and again in 2009-2010, than in the years between and since, so we’re seeing the amount spent rising at a greater rate during times of recession. With significant incremental third-party logistics penetration, we as real estate providers have to get better at providing third-party logistics with the kind of service they need. They are very cost-sensitive and need to move quickly—it’s a matter of speed, response time and market pricing. It also means, however, that third-party logistics are controlling more space and one of the potential negatives of this growth is that when the price of occupancy is embedded in the price of distribution, there is less visibility into the cost and value of space. When occupancy costs are rolled into a value-added service like distribution, it’s more difficult to distinguish between the price-value relationships of either.
NREI: Talk about the economic downturn and how that has affected the industrial sector on the investment side.
John Morris: It has been an inconsistent recovery, especially in terms of regional differences. That “lumpy” recovery—added to the period of the last part of the prior decade when construction came to a halt—adds up to a real shortage of class-A bulk space in tier-one markets, and that is driving up the bid prices on some properties. Real estate is a solid investment, and there is a lot of money chasing space that is harder to find.
Another complicating factor is that many clients are looking for shorter-term leases than previously and are being more flexible on their space commitments. If you’re an investor looking to buy a building, occupancy makes that building worth much more. So, with a tough market, less space, less construction, more money coming after less property and properties with shorter lease terms—that all adds to the challenge for investors in valuing a property.
Lipinski Property Services Names New CEO
Lipinski Property Services hired Thomas Donnelly as chief financial officer for the firm that specializes in exterior facilities management.
Most recently, Donnelly was vice president of finance and administration at USM, a national facilities services enterprise headquartered in the Delaware Valley. There, he created and implemented initiatives to increase service execution and cost efficiencies. He also organized the due diligence and financial integration for several mergers and acquisitions.
Metropolitan Real Estate Equity Management Promotes Four
Metropolitan Real Estate Equity Management LLC promoted four senior executives at the firm, a global investment manager of private real estate fund portfolios for institutions and high net worth individuals.
Margaret Gipe McKnight was named co-chief investment officer and Beth-Anne Flynn, Jeremy Ford and John So were elected partners of the firm.
McKnight will work closely with President and Co-Chief Investment Officer David M. Sherman on investment strategy and portfolio construction with a focus on the United States markets. She has been with the company since 2006.
Flynn, who has been with the firm for five years, is responsible for business development and client service. She has played a key role in the growth of the firm’s client relationships, both among institutions and high net worth individuals.
Ford, who has been with the company since 2005, leads the firm in Europe from his base in London and has led a significant expansion of the firm’s network of high quality managers in Europe, building new client relationships in the region. So, who has been with Metropolitan since 2011, leads in Asia and opened the firm’s office in Hong Kong last year. He has added several new manager relationships and greatly increased the firm’s visibility in Asia.
Director Joins Berkeley Point Capital
Alex J. Katz joined Berkeley Point Capital LLC as a director in the firm’s Santa Monica, Calif. office.
Katz will originate multifamily loans nationally for Berkeley Point.
Most recently, he was principal of CastleRock Enterprises Inc., where he arranged commercial real estate debt throughout the U.S., focusing on senior debt, mezzanine and preferred equity. In addition, Katz raised common equity, negotiated joint venture agreements and established proprietary lending platform relationships with top-tier lenders for CastleRock.
M&M Brings on Research Pro
Marcus & Millichap Real Estate Investment Services promoted Paul N. Arena to regional research director, based in New York City.
Most recently, Arena was the founder and owner of Venturi Advisors Inc., also based in New York City.
In his new role, Arena will be responsible for providing market analysis and strategy-related advisory services to the firm’sclients and will support the company’s sales agents in the valuation and marketing of properties throughout the Northeast. Arena founded Venturi Advisors, a boutique research services and advisory firm serving private equity and institutional real estate investors, in 2008.
Franklin Names Three Senior Directors
Franklin Street Real Estate Services named three senior directors for the firm.
Monte Merritt joins to work in office and industrial properties and Maurice Matovich will focus on multifamily brokerage in Northeast Florida. Elliot Shainberg will work on multifamily properties throughout Southeast Florida.
Merritt has more than 14 years of experience in landlord and tenant representation, including his tenure as a principal at Freeland Real Estate Services, which was later purchased by Lincoln Property Services.
Matovich has performed advisory services in the areas of property analysis and opinion of value, conducted end-to-end property sales consulting, and created a large network ofsourcing throughout Florida.
Shainberg has accomplished more than $61 million in career closings and he worked as a founding member of Marcus & Millichap’s Miami office.
Simpson Joins NGKF in Denver
Newmark Grubb Knight Frank named Dan Simpson director of management services in Denver.
Simpson brings 17 years of property management experience to this position and will be responsible for the day-to-day operations and overall performance of the company’s 7.2-million-sq.-ft. management portfolio in the Denver market.
Simpson comes to NGKF from CBRE, where he most recently served as director of asset services overseeing a management portfolio of more than one million sq. ft. Earlier, he held a similar position with Clarion Realty Services, which was acquired by CBRE in 2007.
Skanska Welcomes Account Manager
Skanska USA hired Raymond L. Hubbard III as an account manager for its Washington, D.C. metro area.
During his three decades of experience, Hubbard has led joint venture agreements, developed lasting client relationships, negotiated mergers and acquisitions and facilitated an abundance of major projects for various industries, including transportation/civil, government/military, residential, office, sports and data center construction.
Before joining Skanska, Hubbard served as senior vice president for Clark Construction, where he worked on various substantial development projects throughout the Washington, D.C. region. He served as the project director/senior vice president in constructing an 82-acre National Geospatial Intelligence Facility in Fort Belvoir, Virginia for the U.S. Army Corps of Engineers.
Two Pros Join Cresa
Cresa hired two executives for its Washington, D.C. office.
Minday Saffer joins as a managing principal and Lucy Wadeson joins as a vice president. Prior to coming on board at Cresa, Saffer served as a principal, and Wadeson was a senior associate, both at Washington, D.C-based West, Lane & Schlager.
While at West, Lane & Schlager, which she joined in 1999, Saffer completed hundreds of thousands of sq. ft. in transactions, with a focus on servicing nonprofit organizations such as trade associations, NGOs and cause-based groups.
During her time at West, Lane & Schlager, Wadeson assisted a range of tenants with their real estate needs, including healthcare organizations that have government-affairs offices in the Washington, D.C. region, as well as nonprofits and trade associations.
Lee Names Two Execs in West L.A.
Lee & Associates welcomed two new hires to the firm’s West Los Angeles office.
Robert A. Clifford comes to Lee as a principal from Western Holdings, which had merged into Capital Real Estate Advisors in 2008.
Clifford specializes in user and developer representation for land and redevelopment properties in southern, aviation properties and sales of golf courses as well as healthcare and senior housing. Prior to joining Lee & Associates, Clifford was president of Western Holdings, which merged into Capital Real Estate Advisors in 2008.
Coming to Lee as an associate, Steve Timm has more than 35 years of professional golf course design, planning, development, management and teaching experience. His depth of experience includes Director of Golf Operations at the Riviera Country Club, home of the annual Northern Trust Open PGA Tour Event in Pacific Palisades, Calif. Additionally, since 1993, Steve Timm has owned Steve Timm Design, a golf courseand planning company.
First VP Joins Massey Knakal
Massey Knakal Retail Leasing Services appointed Joseph Colista first vice president of retail leasing. He will focus on the New York City neighborhoods of Carroll Gardens, Cobble Hill, Columbia Street Waterfront District, Gowanus, Park Slope and Red Hook.
Before coming to Massey Knakal, Colista was an associate broker at Elika Associates, a residential real estate firm in Manhattan. Earlier, he was associate policy director at Green for New York and a compliance and operations manager for Arthouse Films—the latter of which concluded a 10-year career in film and television.
Greenberg Gibbons Hires Leasing VP
Greenberg Gibbons named Tracey Holehan as a vice president, leasing. She will be based in Owings Mills, Md.
Holehan will help oversee the leasing activities for the company’s portfolio of retail and mixed-use properties, such as Hunt Valley Towne Centre, Annapolis Towne Centre, Waugh Chapel Towne Centre and Towne Centre at Laurel.
Before joining Greenberg Gibbons, Holehan held various roles at CBRE, most recently serving as senior associate and team leader for CBRE Baltimore’s tenant representation services group.
VP of Leasing and Development Joins Liberty Property Trust
Liberty Property Trust hired Michael Alderman as vice president of leasing and development for the Lehigh Valley, Pa. region.
Alderman will market more than 4 million sq. ft. of industrial space in the company’s Central Pennsylvania portfolio and will manage build-to-suit and speculative development projects.
He comes to Liberty Property Trust from Jones Lang LaSalle, where he was a senior vice president within the industrial services group.
CBL & Associates Appoints Regional Director of Leasing
CBL & Associates Properties Inc. welcomed Sally Cooney as regional director of leasing.
Cooney will oversee the Cincinnati, Ohio regional leasing team’s efforts and merchandising strategy.
Cooney brings more than 25 years of experience in mall leasing to her new position at CBL. She most recently served as regional vice president for General Growth Properties and was based in the company's Atlanta regional office.
Prudential PenFed Realty Acquires Prudential Coastal Properties
Prudential PenFed Realty acquired Prudential Coastal Properties, a Florida-based agency serving the Panhandle from Pensacola to Panama City.
A full-service real estate agency founded 12 years ago by Susanne Ward, a realtor and long-time broker in the area, Prudential Coastal Properties offers financing as well as buying and selling services for residential and commercial properties.
After the merger, the agency will be renamed as Prudential PenFed Realty and plans to expand from its current staff of 32 agents to as many as 50 by the end of 2013. Royce Mitchell will serve as the broker-in-charge. He has spent two decades in the real estate industry.
Associate Joins Hughes Marino
Kyle Barnas has joined the Hughes Marino team as an associate.
He will specialize in tenant representation throughout San Diego.
Prior to joining Hughes Marino, Barnas was an analyst and associate for Morgan Stanley, where he spent two years in management and advisory teams within wealth management, institutional consulting and corporate stock plan services.
Pircher, Nichols & Meeks Brings On New Lawyer
Daniel B. Teitelbaum joined Pircher, Nichols & Meeks as an associate in the Chicago office. He will work in real estate financing, acquisitions and dispositions and leasing.
Prior to joining Pircher, Teitelbaum worked as a judicial extern at the Hawaii Supreme Court, a law clerk in the Holocaust Reparations Program at Bet Tzedek Legal Services and a legal intern at The Ruben Law Firm. Teitelbaum received his J.D. at the University of California, Berkeley, School of Law in 2012. He is a recipient of the Prosser Prize in Accounting for Lawyers and the Berkeley Law Business Law Certificate.
Attorney Joins Madison Commercial Real Estate Services
Debra Smith joined Madison Commercial Real Estate Services as an associate general counsel for the firm’s Lakewood, N.J. headquarters. She will specialize in handling complex commercial real estate transactions in New York for Madison Title Agency, MCRES’s flagship division.
Previously, Smith served as senior vice president of Fidelity National, where she managed a division of attorneys and related support staff responsible for administering title insurance claims in 16 states and Canada for all FNF brands. She has extensive experience in managing litigation related to title insurance and coverage law.
Law Firm Launched
Trial attorneys Thomas H. Godwin and Robert Tauler have opened a new trial and appellate law firm Godwin Tauler LLP.
The firm focuses on commercial litigation matters, including business disputes, class action defense, real estate, securities, unfair competition and trade practices as well as intellectual property. The firm represents both plaintiffs and defendants in commercial litigation across the country and in international, multi-jurisdictional cases.
Prior to opening the firm, Godwin practiced commercial litigation with Greenberg Traurig LLP. Tauler was previously a commercial litigator with Greenberg Traurig.
Stan Johnson Expands Office
Stan Johnson Company is expanding its office space in New York City.
The new office is located at 180 Madison Ave., Suite 2200 and the relocation will take place in November. The firm is going from six executive suites totaling 600 sq. ft. to 4,594 sq. ft. to accommodate 17 brokers and support staff. Currently, the firm has six brokers and plans to expand in the coming months.
CREW-Los Angeles Honors "Women at the Top"
Commercial Real Estate Women – Los Angeles honored four members with its “Women at the Top” award on October 18 at the Millennium Biltmore Hotel in Los Angeles.
The honorees include Christine Deschaine, principal of Lee & Associates LA North/Ventura Inc.; Susan Booth of Holland & Knight and Tori Robinson of Old Republic Title Co.
Deschaine was honored for her ability to balance her retail brokerage activity and volunteer initiatives. She was one of the firm’s first female partners and she specializes in urban redevelopment and is active in local charities such as Harvest Home, Hope Gardens Family Center and the Women’s Foundation of California Los Angeles Chapter as well as the Tennessee-based Global Support Mission.