6th annual real estate women’s forum new york
TRANSCRIPT
9:00AM – Morning Keynote with Kathryn Wylde
Effective Leadership Gives NYC Its Edge
Kathryn S. WyldePresident & CEO
All time high in population, jobs, economic activity
• 8.5 million residents• 4.4 million jobs• $82 billion city budget • $740 billion GCP • 48 Fortune 500 headquarters
New York City Has Come a Long Way Since 1970s
1960
1965
1970
1975
1980
1985
1990
1995
2000
2005
2010
2015
3,000,000
3,200,000
3,400,000
3,600,000
3,800,000
4,000,000
4,200,000
4,400,000
Jobs in NYC: 1960-2016
1975
1978
1981
1984
1987
1990
1993
1996
1999
2002
2005
2008
2011
2014
$-
$50
$100
$150
$200
$250
$300
$350
$400
Total Wages (in billions)
Crime down 80% from 1990-2014
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
0
100,000
200,000
300,000
400,000
500,000
600,000
Crimes
Tourism Increase
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
0
10
20
30
40
50
60
Chart Title
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
0
5
10
15
20
25
30
35
40
45
Visitor Spending ($ billion)
Strength Through Diversity
Total population
U.S. workforce
New York City workforce
0% 20%
40%
60%
80%
100%
Foreign-born workers U.S.-born workers
In New York City, immigrants represent 45% of the workforce and 48% of the small business owners, 39% of doctors and 55% of computer programmers.
Wall Street is New York City’s Economic Engine
21% ($153 bn)
5% ($36 bn)
10%
9%9%6%
6%
5%
30%
Percentage of City’s Economic Output
Financial Services
High-Tech
Professional Services
Government
Retail and Wholesale
Health Care
Information (excl. High-Tech)
Real Estate
Other
High-Tech is New York City’s Fastest-Growing Sector
2009 2010 2011 2012 2013 2014 2015 2016
-10
0
10
20
30
40
50
Job Growth
High-Tech Financial Services
Education
U.S.
Dallas
Los A
ngele
s
New Y
ork C
ity
31% 32% 33%37%
Approximately 37% of New York City residents over 25 have a college degree, which is well above the national average.
Approximately 35 percent of new jobs added to the economy will require post-secondary education from 2016 to 2026.
Master
's de
gree o
r high
er
Bache
lor's
degre
e
Assoc
iate d
egree
Some c
olleg
e/no d
egree
High sc
hool
diplom
a
Less
than
a hig
h sch
ool d
iplom
a
5%
21%
2%7%
31%34%
NYC FY 2017 Budget
28% $23.2 bn
12% $9.8 bn
4% $3.0 bn
6% $5.2 bn2%
$1.9 bn2%
$23.2 bn
11% $9.4 bn
46%$37.4 bn
Education
Social Services
Children's Services
Police
Fire
Sanitation
Pension Contributions
Other
Infrastructure
In the New York City metro region, nearly $60 billion is needed to bring public infrastructure assets to a state of good repair over the next five years.
Cost of State of Good Repair
City University $2.0 billion
Housing Authority $16.6 billion
MTA* $26.6 billion
NYC Transit $16.3 billion
Other MTA $10.4 billion
Port Authority* $6.8 billion
Department of Education $2.0 billion
Department of Transportation $2.9 billion
Other City Agencies $2.2 billion
Total $59.2 billion
* Includes all assets, not just those located in New York City
Infrastructure: Prototype Projects
Amtrak’s Gateway Tunnel Connecting New York and New Jersey250,000+ commuterscross the Hudson River each day using public transit.
100% increase in rail ridership is expected by 2040.
10 years of remaining useful economic life for existing Hudson River tunnels.
$5.9 millionCity employers incur $5.9 million in losses for each hour of delay on NJ Transit operations.
Upgrade Air Traffic Control to Increase Efficiency of New York Metro Airports52% of business travelers reported avoiding flying to meetings in New York due to local airports.
~75% of nationwide flight delays are attributable to problems in New York’s airspace.
66 minutesAverage delay for domestic flights from New York airports
$2.6 billionAnnual cost of delays to the regional economy due to air traffic congestion
GlobalCorporate Tax Competitiveness
United
Stat
es
German
yChin
a
United
King
dom
Singap
ore
Hong K
ong
Irelan
d0%
10%
20%
30%
40%
50%
60%
U.S. corporate taxes are the highest in the developed world
8.85% New York City
6.5% New York State
Global Personal Income Tax Competitiveness
International competitors have lower combined PIT rates than New York City.
City Top statutory PIT tax rateLos Angeles 52.9%
New York City >52%
London 45%
Paris 45%
Dublin 40%
Dallas 39.6%
Orlando 39.6%
Singapore 22%
Hong Kong 17%
States with no personal income tax are outperforming New York in economic growth and business climate.
Texas Florida New York
Top marginal income tax rate, 2016 0.0% 0.0% 8.82%
Top marginal corporate income tax rate, 2016 0.0% 5.5% 6.5%
Absolute domestic migration cumulative, 2005–2015 +1,334,575 +841,292 -1,717,390
Number of Fortune 500 companies headquartered in the state, 2015 51 17 55
Gross State Product growth, 2005–2015 44% 3% 12%
Rank on the 2017 State Business Tax Climate Index 14th 4th 49th
Rank of the state’s economic performance, 2016 1st 18th 26th
Rank of the state’s economic outlook, 2016 12th 8th 50th
New York is a large net contributor to the federal budget
New York to Washington, D.C. Washington, D.C. to New York
$117.3 billion
$61.2 billion
Balance of payments deficit: $56.1 billion
440 Emerging Cities Will Account for Nearly Half of Growth
GDP growth through 2025
Emerging CitiesDeveloped CitiesSmall Cities and Rural Areas
Current GDP
Emerging CitiesDeveloped CitiesSmall Cities and Rural Areas
10:00AM – Cranes in the Clouds: Development & Construction State of the Market and Outlook
New | RenewFiscal Year 2013-Current
Audience Q&A: Slido.com | Code: 4853 Author: Rose Associates
$2.17B
$1.4B 1,856 250k+
88k
Asset Value Total Debt Luxury Rental Units
SF Retail Space
SF Amenities
space
40 $41.5M
988 $16.3M
140k
Renovation Buildings
Renovation Total
Units Renovated
Public Area Upgrades
SF Public Area
New Development
Renovation
LIHTC Equity Implications of Expected Corporate Tax Cuts118 Unit, 120,000 SF Mixed-Use Rental Development in East New York
Audience Q&A: Slido.com | Code: 4853 Author: Terri Belkas-Mitchell
Development Sources Pre-Election Post-Election
HDC First Mortgage (Tax Exempt Bonds) 3,675,000 3,675,000
HPD Subsidy Second Mortgage 8,850,000 8,850,000HDC Subsidy Third Mortgage 7,670,000 7,670,000HPD Subsidy Fourth Mortgage 5,040,000 5,040,000Low Income Housing Tax Credit Equity 16,408,000 14,984,000Deferred Developer Fee 400,000 490,000TOTAL SOURCES 42,043,000 40,709,000Funding Gap 1,334,000
11:30AM – Track A – Next! Emerging Neighborhoods & Markets on the Rise
• 85,000 SF mixed-use center with Class A medical office,
retail stores, banking and restaurants• Adaptive reuse of 1924 historic building• Parking ratio of 4.85/1,000 SF
SIMONE DEVELOPMENT COMPANIES
Before After
Audience Q&A: Slido.com | Code: 4853
BROOKLYN NAVY YARDCURRENT DEVELOPMENT PROJECTS
Real Estate Women's Form | February 16, 2017 Audience Q&A: Slido.com | Code: 4853
26
L+M Properties – Greater NYC Area
Audience Q&A: Slido.com | Code: 4853
12:15PM – Track A – Current Affairs: Financing and Investment in Today’s Market
Foreign acquisition still more than 10% of total volume
• Net foreign US investment fell in 2016, still third highest on record
For professional clients / qualified investors only
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016-$20
-$10
$0
$10
$20
$30
$40
$50
$60
$70
$80
8%
4%
0%
4%
8%
12%
16%
20%
24%
28%
Foreign Annual Net Acqusition Foreign Acqusitions as % of Total
Net
vol
ume
(bill
ions
)%
of total Acquisition Volume
Source: Real Capital Analytics, BlackRock; as of 31 December 2016
Audience Q&A: Slido.com | Code: 4853
Ceruzzi Investment Portfolio
155 E 86th St. 138 E 50th St. Lipstick Building (Land)
Net Sellable SF 151,000 180,000 635,653 (Gross)
Retail SF 30,000 7,350 -
Condo Units 61 124 N/A
Total Costs $415,000,000 $492,000,000 $457,625,000
Loan Amount $290,000,000 $255,000,000 $267,000,000
Preferred Equity/Mezz - $60,000,000* $135,000,000
Total LTC 70% 64% 88%
Interest Rate L + 850 L + 425 6.25%
Senior Lender TCI FUND ICBC GOLDMAN SACHS/SLG**
Partner KUAFU PROPERTIES SMI USA N/A* In Process ** Subject to prepayment with no fee on 4/20/17 Other current projects: 520 Fifth Ave.
Audience Q&A: Slido.com | Code: 4853 Author: Ashley Rissolo
12:15PM – Track B – Rethinking Office Space: Beyond Open Layouts and Coworking
Long Island City Office Mkt.12.5 M1.9 M
Approximate Square Feet of Useable Office Space
Square Feet of New Ground Up & Conversion Office Space Delivered Since 2006
4Q06 4Q07 4Q08 4Q09 4Q10 4Q11 4Q12 4Q13 4Q14 15-Oct3
4
5
6
7
6.36.6 6.6
65.7
5.15.3
4.5
4
5.6
Office Vacancy Rate(%)
Source: Long Island City PartnershipAudience Q&A: Slido.com | Code: 4853
Audience Q&A: Slido.com | Code: 4853 Author: Maggie Burns
1:10PM – Track B - 555TEN: How to Successfully Bring a New
Development to Market