Municipalities are now, more than ever, entering the fray of development, disposition and revitalization - by Brett Pelletier

July 29, 2016 - Front Section
Brett Pelletier is a senior analyst with Kirk & Co., Boston, Mass. Brett Pelletier, Kirk & Company

Municipalities and mission-based organizations are now, more than ever, entering the fray of real estate development, disposition, and revitalization. As the economy continues to recover regionally and nationally, municipal real estate problems and opportunities surface with urgency.   Real estate and land-use challenges facing municipalities, non-profits, and community groups are not insurmountable, however, they often require capable and competent counsel to guide decision making. These clients require nimbleness and efficiency in their counsel in order to best serve their constituent groups; often residents, taxpayers, and beneficiaries of mission-based organizations. Specialized skills and understanding are essential when advising clients with such needs and expectations in order to deliver relevant and substantive assignment conclusions that help the organization solve problems and achieve goals. That often includes identifying alliances within the real estate community that provide low- or no-cost solutions, identifying risks, potential partners, and resources available to ensure the client is as well informed as possible.

Municipalities, specifically, have distinctly different objectives than private clients and are generally very well informed about their local markets and assets. A holistic view of the marketplace and the real estate issues is necessary to adequately contextualize the problem to be solved and the relevant solutions available to the client. Many small towns in New England are largely run by a number of boards and commissions staffed by resident volunteers; especially in land-use planning and elected executive government. These groups are not always sufficiently supported by members of the real estate finance and development community and opportunities exist for partnerships with experienced and effective real estate advisors to bridge gaps. Because of the way land-use, property disposition, and development decisions are commonly made by such boards, the process is unlike what most private processes look and feel like. A consultant with expertise dealing with municipalities and a public process can be an essential component of a successful transaction or project and can effectively serve as an intermediary between public and private entities.

The issues that municipalities in New England often struggle with are common and frequently involve the disposition or redevelopment of historic assets or surplus land. Former school houses, town halls, libraries, and community buildings that are no longer utilized are prime candidates for action. The circumstances are almost always unique and depend substantially on the local market, the community, and the form of government within the town or city. Municipal clients need and deserve value added service and follow-up throughout the public processes, which takes time and patience. The assignments require a wide understanding of real estate development, land-use planning, and feasibility, and sensitivity to the fact that public buildings and projects are often part of the physical identity of the community. All of these issues require care, diligence, and leadership to provide credible conclusions and actionable counsel for policy- and decision-making. Practical development and investment strategies provide value added services to clients who often have limited flexibility and resources. Matching the counsel with the client’s level of sophistication and need is an important task for communicating conclusions and developing strategies. An important task may also be to de-clutter; quieting the noise and narrowing the focus and scope of the inquiry for efficient delivery of services. Independent counsel from the start helps to identify the issues and refine the scope of the assignment and leads to better results and a better-informed client.

One major hurdle that most public entities face is the solicitation process. Municipalities and government entities are primarily reliant on RFPs or a similar public process for soliciting interest, services, and bids for a particular project. RFPs are often inadequately advertised and bids are open for less time than is typically required to attract enough attention and response from qualified entities. RFP processes need to be refined and specific in order to attract sufficient interest and ultimately provide value to the municipality. Public processes take time and the solicitation process needs to be efficient and effective. Stalling and inaction are the direct, and very costly, result of a process that has not achieved adequate exposure or clarity. Time, money and momentum are wasted when project requests are developed and presented without response. A consultant with public and private client expertise can be helpful in reducing or eliminating those barriers to success.

Responding to a public process takes time and energy and often requires building a team and sensitivity to those issues are central to responsiveness and clarity. As a real estate consultant, I am always happy to assist municipalities, non-profit, charities, and community, and mission-based groups in answering those initial inquiries and helping to identify essential problems and strategies. Consulting assignments often mirror the life-cycle of the project; from genesis to completion, disposition, or redevelopment, and anything in between. It is certainly an exercise in diligence for all parties involved in real estate problem solving.

Brett Pelletier is a senior analyst with Kirk & Co., Boston, Mass.



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