Texas Man Sentenced for Hotel Investment Fraud Scheme

An Austin, Texas man was sentenced to 70 months in prison and ordered to pay $5,052,366.92 in restitution for his role in a fraud scheme.

According to court documents, from 2012 until June 2018, Jason Michael Schubert, 47, devised a scheme to bilk hotel investors out of millions of dollars. Schubert identified potential investors by conducting seminars on how to make money from investing in hotel properties, known as “Rich in Five” seminars, charging the participants substantial fees to attend. Schubert then solicited money from the participants for investing in preexisting hotel properties that he would manage and operate while claiming that investors would profit with little effort on their part.

However, many of the hotels were older and in substantial disrepair. Although Schubert had no hotel management experience, he represented that investor funds would be used to renovate the hotels. Instead, he misappropriated the money by paying himself significant “management fees.” Schubert’s fraudulent activities depleted investor funds, causing the hotel properties to go into foreclosure with a loss of over $5 million to investors. Click to read more at www.insurancejournal.com.

The COVID Game-changer: Healthy Offices Now a Must-have, not a Nice-to-have, for Building Owners, Employers

How healthy are offices across the United States? And are employees more likely to return to the office – at least on a part-time basis – if their employers take the steps necessary to boost indoor air quality, improve natural light and surround their work areas with green spaces?

These are questions tackled by Joanna Frank, founding president and chief executive of the Center for Active Design in New York City. The center is the operator of Fitwel, a certification system originally developed by the U.S. Center for Disease Control and Prevention that measures how healthy offices are.

The health of indoor working spaces is a hot topic today, thanks in part to the COVID-19 pandemic and the desire of employers to bring their workers back to the office after so many have worked remotely for more than two years.

Consider these facts from the Center for Active Design:

Indoor air pollutants are generally two to five times greater than outdoor levels of air pollution.

Poor light quality and uninspiring views in offices cause employees to miss more time from work with illnesses.

Employees greatly benefit from natural, green surroundings, which are often a small investment for companies and building owners to make.
Frank said that employers and building owners should invest in ways to improve the health of indoor office spaces, especially if they want to bring their workers back to their conference rooms, cubicles and desks.

To do this, though, owners and employers need to understand what makes a building or office space healthy. Frank said that there are three keys.

No one-size-fits-all solution

First, building owners must address of the needs of the occupants of a building.

“This lets you know that this is not a one-size-fits-all solution,” Frank said. “You have to respond to the needs of the users of a space.”

Secondly, it’s important for employers and owners to enact strategies that have already been proven to produce cleaner air, happier employees and a more productive workplace. Employers should search out the evidence to prove that the investments in healthy spaces they are making will provide results.

And maybe most importantly, employers and building owners must measure the impact of their healthy workspace initiatives. They must also share these results with their tenants and employees.

This means that building owners must be able to show their tenants that healthy initiatives are helping them attract and retain employees and that these workers are more productive now that healthy initiatives are in place. And employers must show their workers that their indoor air quality ratings are high, more outdoor light is bathing their offices’ interiors and that employees are calling in sick less often.

The key here? Companies are not likely to pay more to lease office space just because it is healthier. And building owners are not likely to invest in green space, air-purification spaces and indoor gathering spaces just to be nice. Owners and tenants need to see that these healthier additions will pay off, whether this means giving owners additional tools to attract more tenants and charge higher rents or giving tenants the amenities they need to convince employees to return to the office or attract and retain the best talent.

“The more research-based strategies you have promoting health, the higher the degree of tenant satisfaction,” Frank said. “The more things you do to promote health, the more likely you are to retain workers. You must be able to demonstrate those business outcomes if you are a building owner. Real estate needs that proof. Real estate demands that you can show that return on investment.”

Fortunately, Frank said, this isn’t difficult to prove. As she says, there has always been a direct correlation between the health of a business’ workers and their productivity.

What has changed since COVID, though, is demand: Workers are now demanding healthier office environments.

“People are now demanding that their companies be able to demonstrate how they are promoting and protecting their health,” Frank said. “Before COVID, we weren’t seeing individuals asking for a healthier work environment. That has now changed. That is a game-changer. We knew how to create healthy office spaces before COVID. We had a massive body of evidence showing how to do this. The difference now is that the workers are demanding this, which is persuading companies to explore their options.”

And employees want proof that companies are taking steps to promote their health, Frank said. It’s no longer enough for companies to say that they are taking steps to boost indoor air quality, for instance. Today, they must show their workers actual statistics and test results proving that their claims are true.

“It has changed from health being a nice-to-have before COVID to being a must-have today,” Frank said. “It used to be that building owners would think about healthy building measures after they took care of everything else. But now, owners can lose their Class-A tenants to other buildings that are demonstrating how they are promoting health and wellness.”

Creating the healthy workplace

What are some of the steps, then, that building owners can take to boost the health of their tenants?

Frank said that companies and their workers today are focused heavily on indoor air quality. It’s important, then, for building owners to improve the air-purification systems and air flow in their buildings. They need to bring more outside air into their workspaces.

This will boost not just the physical health, but also the mental health of building occupants, Frank said.

High-quality natural light is important, too, for the physical and mental health of occupants, Frank said. And offices need outdoor light to flood their spaces, not artificial. Frank said that studies have shown that natural light is directly related to employee productivity.

Another key is that building occupants have access to nature and green spaces. This could be a small rooftop garden or even the addition of indoor plants.

“You can do this in any building,” Frank said. “It doesn’t have to be new construction. You can bring nature into a space very effectively by using green walls, plantings, whatever you have. Bringing nature into the office is very important for employees’ mental health and feelings of well-being.”

What also matters is building trust, Frank said. This means that building owners and employers must show workers real numbers showing how effective their healthy measures are. And they must share these numbers even if they show that a particular measure isn’t having as much of an impact as they had hoped.

And if the numbers show bad news? Employers and building owners must share their plans for replacing or improving whatever measures aren’t working, Frank said.

Consider indoor air quality. Building owners and employers can’t just say that they are using a certain level of filtration. They must explain why they are using it, Frank said, and what their air-quality goals are.

“People have become very educated about indoor air quality,” Frank said. “You need to provide details. You need to tell tenants about how much outdoor air you are bringing into the building. You need to be measuring indoor air quality in a consistent way. And what will you do if you are not achieving the results you want? That is a tough one for building owners. There is risk involved. You need to have policies in place explaining how you will respond if your system provides less-than-optimal air quality.”

How healthy are offices across the United States? And are employees more likely to return to the office – at least on a part-time basis – if their employers take the steps necessary to boost indoor air quality, improve natural light and surround their work areas with green spaces?

These are questions tackled by Joanna Frank, founding president and chief executive of the Center for Active Design in New York City. The center is the operator of Fitwel, a certification system originally developed by the U.S. Center for Disease Control and Prevention that measures how healthy offices are.

The health of indoor working spaces is a hot topic today, thanks in part to the COVID-19 pandemic and the desire of employers to bring their workers back to the office after so many have worked remotely for more than two years.

Indoor air pollutants are generally two to five times greater than outdoor levels of air pollution.

Poor light quality and uninspiring views in offices cause employees to miss more time from work with illnesses. Click to read more at www.rednews.com.

Inflation? War? COVID? None of it can Slow Down the Multifamily Market

Yes, inflation is battering the U.S. economy. The country is still dealing with COVID-19. And Russia’s continued attack on Ukraine brings its own set of worries. But despite all this turmoil? The U.S. multifamily market continues to boom.

In its April Multifamily National Report, Yardi Matrix said that the average asking apartment rent in the United States rose $15 in April to an all-time high of $1,659. This is an increase of 14.3% from the same month a year ago.

In the largest 30 metropolitan areas in the United States, monthly rent growth was up at least 8.8% during the last year in all but one. And this increase in monthly rents was remarkably consistent. Yardi Matrix reported that rent growth was positive in each of these large metropolitan areas during the last one-month, three-month and 12-month periods.

Of course, not all markets are equal. Yardi Matrix said that Miami led the way in April with a 24.6% year-over-year rent increase. Overall, though, asking rents increased by 20% or more on a year-over-year basis in five of the largest 30 metropolitan areas and 10% or more in 26 of the biggest 30 markets.

The rent growth wasn’t as robust in all Midwest markets. Yardi Matrix said that year-over-year rents increased by just 4.7% in Minneapolis-St. Paul and just 8.8% in Kansas City, Missouri. These ranked among the lowest percent increases among the biggest metropolitan areas in the country.

What does the future hold? Yardi Matrix said that the fundamentals are still in place for steady growth in multifamily rents. Most importantly, the country still faces a shortage of new single-family housing. Yardi Matrix reports that an average of 16 million to 17 million new homes were built between the 1980s and 2010. That number fell to less than 11 million in the 2010s.

This has left the United States short of several million single-family homes. Leonard Kiefer, deputy chief economist at Freddie Mac, says that the country went from a surplus of 1.9 million units of housing in 2010 to a shortfall of 3.8 million units in 2020.

You can blame the financial crisis of 2008 and 2009 for the shortage of newly built homes. During and after the crisis, banks slowed the amount of financing they made available for single-family and multifamily housing. That resulted in a slowdown in new residential construction.

Today, a shortage of land and the high cost of construction materials and labor is contributing to the slowdown in residential construction. Developers also face regulatory hurdles and NIMBY protests in many areas.

This all adds up to higher costs for housing, including of the multifamily variety. And these pressures are showing few signs of lessening, meaning that monthly apartment rents aren’t forecast to decline anytime soon.

What does this mean for renters? They can expect to pay more for their units, especially if they plan on living in a major metropolitan area.

Searching for Stability Ongoing Disruptions to the Global Supply Chain will Impact Commercial Real Estate

But opportunities are available across various sectors.

Everyone is feeling the pinch of the supply chain disruption, whether they are walking by empty store shelves or waiting weeks for a part in a much-needed auto repair. For commercial real estate professionals, that supply chain disruption is creating both challenges and opportunities.

The big question is just how long supply chain disruptions will last — and views from experts are mixed, with estimates ranging from 12 months to more than three years. Although the cargo ships stacked up outside the ports of Los Angeles and Long Beach have become symbolic of the supply chain crisis, problems with the movement of goods go beyond a single bottleneck. “We have had structural things that were happening before COVID-19 that were heading us toward supply chain disruption,” says K.C. Conway, CCIM, MAI, CRE, chief economist of the CCIM Institute and principal and co-founder of Red Shoe Economics.

The pandemic also highlighted the dependence the U.S. has on imports from Asia and the dominant role China plays in the global world of manufacturing. “When China shut down, effectively because of COVID-19, that was the traffic accident on the 405 that backed everything up,” says Richard Thompson, international director, Supply Chain & Logistics Solutions, Americas at JLL. Even after they cleared the wreckage and started to reopen, there was a bullwhip effect on the rest of the world, he adds, as demand disruptions traveled throughout the supply chain, from end-user to manufacturer. Global supply chains are still dealing with the enormous ripple effects, including large queues of ships at the ports. Click to read more at www.ccim.com.

Pack it up! Chicagoland Claims Top Rankings for Most Affordable Suburbs

Suburbia has always been appealing, but the migration away from city living is maintaining momentum for a variety of reasons.

Many who made the choice to move away from city living at the onset of COVID-19 have come to prefer the relaxed atmosphere and lower-density neighborhoods to the hustle and bustle of a hub like Chicago.

But these luxuries come at a price. One might think suburban living is cost-conscious, but in some areas, it was found to be just the opposite — especially if you’re looking to settle in a suburb with premium housing, safe neighborhoods and a variety of shopping and dining options.

To find the most affordable premier spots, StorageCafe ranked suburbs nationwide. And Chicago’s suburbs? They stole the spotlight.

The Midwest is home to some of the most neighborly communities in the U.S., and its cost of living is friendlier than many locations, according to the report. Crystal Lake among the most affordable places, and rents for storage units make relocating even more appealing at around $100/month. This is much lower than in Chicago.

Algonquin, Elk Grove Village, Bloomingdale, Vernon Hills and Buffalo Grove are a few more Illinois names that made the list. Residents find these cities especially attractive because of the many outdoor recreation opportunities that aren’t as easily accessible in Chicago.

Wisconsin and Minnesota also have a few cities on the list, including of Pewaukee and Brookfield for Milwaukee and Rogers for Minneapolis.

Aside from the Midwest, the South is another sought-after region due to its affordability compared to places like California and New York. Homes in Dallas’ Southlake are nearly one-third of the price of those of comparable size in LA’s Laguna Beach — $1.1 million to $3 million.

Illinois and Texas, though, are no longer a best-kept secret and are in high demand because of their relative affordability and strong employment sectors, according to StorageCafe. California to Texas, for example, is one of the busiest relocation routes in the U.S., and 190 Californians are trading their Louis for Lucchese per day.

The preference of suburbs to cities is strong nationwide. According to StorageCafe, Pew Research Center found that Americans who prefer suburban living saw an increase from 42% to 46% over the last three years.

Because of the continued influx, the now-attractive prices might not stay attractive for long.

JLL Valuation Advisory Hires Managing Director to Lead its Institutional Sector

JLL Valuation Advisory announced today that it has hired managing director Tasha Gould, MAI, to lead its institutional sector for its U.S. valuation advisory services and is focusing on providing technology-driven solutions to best serve institutional clients.

Gould is responsible for managing and expanding institutional client relationships and partnering with sector and market leads to provide superior client outcomes. She now plays a critical role designing and executing a sector growth strategy, building relationships and managing delivery quality. She also plans on recruiting and mentoring team leads and collaborating with technology and operations to improve JLL Valuation Advisory’s platform and drive culture.

Gould has amassed 19 years of experience in institutional valuations, financial analysis and planning, audit and compliance, strategic partnerships, project management, client relationship building and more. She previously served as director of valuations for Invesco Real Estate, where she led a team of 12 valuation managers and analysts while overseeing valuations for Invesco’s direct real estate. Prior to that, she was the senior appraiser for Principal Real Estate Investors managing the valuation process for their North American portfolio that included office, retail, industrial and multi-housing assets. She is based in Dallas, Texas.