Event Recap: Tuesday General Session

This year’s Convention was attended by over 500 professionals and established a record for first-time attendees with over 100 new NAI professionals in Carlsbad, as well as offices from China, Australia, New Zealand, Germany, Austria, Czech Republic and a prospective affiliate from Saudi Arabia.

The first full day of NAI Global’s Annual Convention started with NAI Global President Jay Olshonsky and Senior Managing Director Alex Waddey discussing generating business beyond local markets.

They presented a case study on a lead from a broker in Bend, Oregon, and how it turned into a portfolio sale in Winston-Salem, NC with LRC Properties LLC.

The takeaways from the session were:

  • Never believe someone is committed to another firm until they sign with them
  • Never believe you are only pitching business for one asset
  • Get information and do the due diligence months before it goes to market to create the most attractive disposition options, and
  • Get familiar with all the sister companies associated with NAI Global (like Real Capital Markets and NAI’s Capital Markets Group) and leverage those relationships to grow your business.

As Waddey said toward the end of the presentation, “We’re not just pitching for one deal but building the brand and our platform to establish future opportunities.”


Next up was Andy McCulloch, Managing Director for Green Street Advisors, which offers independent analysis to institutions, REITs and other investors that buy, hold and sell commercial property in the U.S.

McCulloch presented numbers, slides and graphs that were data rich and what one might expect from a financial analyst. The first topic he addressed was rent growth, which he said is slowing – still healthy, but slowing, and he presented a slide showing where we are in the cycle specific to product types. It didn’t surprise the NAI audience when he said that industrial is performing the best and retail the worst. Even so, he qualified his retail comment by saying that neighborhood-serving grocery-anchored shopping centers are still doing well as a category. Overall, Green Street is forecasting five more years of rental growth, led by industrial (4.1%) and Senior Housing (3.0%).

“For the most part Cap Rate compression has stopped in part because investors are a little bit more hesitant to buy, fear values have peaked and the policy reform expected early from the Trump administration so far has not materialized – creating increased uncertainty. However, debt is still cheap and available so there remains a decent volume of investment sales in the market place,” he said.

The unwelcome news for real estate is in the mall sector. McCulloch said there are 1200 malls in the U.S. today and he expects 300 of them will close or become irrelevant retail destinations in the next 10 years, and more malls will be shuttered in subsequent decades. “It’s one property type that is ripe for rightsizing,” he said.

“Malls will adapt or die. Apparel has historically constituted 75% of mall space. It is about 50% now and could be 25% in the future, replaced by experiential retail, entertainment and more F&B.”

While eCommerce is currently the biggest disruptor in real estate, in the next 10-15 years driverless cars may be the biggest disruptor in real estate, according to the Green Street analyst. There are 3 million driver-based jobs in America now – 2% of the workforce, driving trucks and taxi cabs. Those jobs could vanish. There are 1 billion parking spaces in the U.S. that could be cut in half or more once fewer people own cars. America has 10 times the amount of garage space than we do self-storage space. All that freed up garage space will put a lot of pressure on the self-storage business.


Closing out the morning session, John Klymshyn presented his “Elevated Language™” approach which stressed the importance of language in communication, with an emphasis on listening over talking.

He was introduced by Marten Barry, President of NAI San Diego, the host-city representative.

“The more I listen to what you say makes me more fascinating to you,” was one of Klymshyn’s better quotes (among many!).

Klymshyn reminded us of the importance of humanity and humility in establishing personal and business relationships, and the “amazing power of language.”

“One of the great things about humor is that it softens our minds to open our hearts,” he said.

While ostensibly his talk was about the importance and power of language in speech, the clear takeaway was the prevailing and overwhelming influence of listening.

“It’s not what we say that draws people to connect, but what we listen to and hear from others that connects us.”