Needham, MA The New England Real Estate Journal (NEREJ) held its second annual “Changing World of Commercial Real Estate” summit on December 6th at the Sheraton Needham Hotel, 100 Cabot St. The event also honored Harold Brown, chairman emeritus of The Hamilton Company, with an induction into the NEREJ’s Blue Jacket Club. He was also presented with a Lifetime Achievement Award.
The summit began at 8 a.m. with an hour of networking and breakfast. At 9 a.m. Rick Kaplan, of the NEREJ, opened the event by thanking the sponsors:
• Platinum: The Fallon Company, Brookline Bank and The Copley Group.
• Gold: Bedford and Berman Adjusters
• Corporate: Roblin Insurance, U.S. Pavement Services, Inc. and National Grid.
Greg Vasil, CEO and president of the Greater Boston Real Estate Board, moderated a panel that consisted Bruce Percelay of Mount Vernon Company and Norman Levenson of The Copley Group. The panel discussed topics important to the Boston housing market such as the housing boom, tenant quality, construction costs and retail.
Percelay stated that the Boston market is ideally situated for dramatic growth. The city is home to over 40 colleges and universities and life science/biotech companies that contribute to its growth. He pointed out that there is a high demand for people looking for a quality roof over their head and that the biggest risk is the high-end market.
Percerlay said, “It doesn’t pay to build very inexpensive apartments. The cost of a brick is the same, whether you rent an inexpensive unit or you rent a luxury unit – so the market has gravitated towards the ‘high-end.’ It is exactly the sector that we don’t want to participate in because there is only one way out and if a person does not care to rent a $4,000 or $5,000 or $6,000 apartment, that apartment may not have a second life. Everyone talks about how we can convert everything into condominiums, but for those who understand the banking world, and how debt is structured, the conversion of luxury apartments to condominiums is not always something that can be easily done.” He went on to state that the highest risk is in the luxury sector. “Conversely, the lowest risks, which is a lot of what Harold’s portfolio is, and a lot of our portfolios are, entry-level housing. You cannot replicate entry-level housing.”
Levenson stated his reasoning as to why Boston is booming. He said that mayor Marty Walsh understands that the city needs housing and has created zoning to allow more density. He works with developers and expedites the process for developing in the city. Also, the fact that Boston has an international airport in the city contributes to its attraction. Companies are opening operations in the city and college students are staying after they graduate.
Levenson said, “A lot of companies are opening here. A lot more people are coming to school here, and as they come to school, they are loving the city, and they are staying here. And they bring with them, the wealth of the knowledge that they have and their families have. And you see more and more people from foreign countries living in Boston than you have even seen before.”
Percelay also touched upon the misnomer about supply creation. Some people believe that the city faced the risk of over-building. There is another way to look at it–the more supply we make, the more people the city can attract.
Percelay and Levenson also discussed how to bring down construction costs and in Boston retail market – are we going to see more mixed-use housing to replace old storefronts? The panel ended with a question and answer session that included topics on traffic solutions in the city and politics in housing.
After the panel concluded, the NEREJ showed a short video on Brown, highlighting his achievements and career. There were interviews with Rusty Aertsen of The Hamilton Co., Charlie Peck of Brookline Bank, Joe Fallon of The Fallon Co., Ellen Alves of The Hamilton Co., Mary McCarthy of The Hamilton Co., and Roland Hopkins of the NEREJ.
Brown was then presented with the NEREJ’s Lifetime Achievement Award and inducted into Blue Jacket Club by Kaplan. Brown accepted his award and thanked the NEREJ. Brown’s son, Jameson Brown, co-CEO/COO of The Hamilton Co., joined his father to accept the award and recapped his many achievements in the industry.
Join us at our next summit, “Multi-Family & Property Management” on January 31, 2019 at the Boston Marriott Newton.
Contact Rick Kaplan at 800-654-4993, ext. 247 or [email protected] for more information. Register online at: www.multifamilypm.eventbrite.com