David Begelfer
Editors note: After more than 27 years leading NAIOP Massachusetts – The Commercial Real Estate Development Association, CEO David Begelfer has retired from his position as executive director and is now the founder of CRE Strategic Advisors, a commercial real estate consulting firm that provides advice and guidance to private, corporate, and institutional clients with real estate opportunities or challenges.
In recognition of all he has done for the commercial real estate industry, NAIOP honored Begelfer at its annual Distinguished Real Estate Awards Dinner recently with the Edward H. Linde Public Service Award.
For the past several years David has entertained us with his personal predictions for the coming year. HP asked David to share this year with us.
by David Begelfer
Here are my last predictions as CEO of NAIOP (but not my last predictions)!
- Wayfair will double their occupancy in Boston.
- Boston and Cambridge office rental rates will rise to record levels for new space, surpassing $120 psf.
- Apartment rental rates will be flat.
- WeWork will make a move to the suburbs.
- Electric bikes and scooters will be allowed in Boston (and then regretted).
- Bitcoin value will fall, other cryptocurrencies will rise.
- Foreign investment in commercial real estate will drop.
- The stock market will hit an all time low and an all time high.
- The Fed will raise rates .25% only once during the next year.
- Tiger Woods will win a major.
Below were my predictions for 2018 and what happened. Not too bad!
1. Amazon will pass on Boston for a campus but leave us with a great consolation prize. [Yes and 1mm sf coming to the Seaport].
2. No Turnpike air rights project will start construction (ditto for 2019). [None, so far]
3. Fed. interest rates will be up 75 basis points by end of year. [50 basis points]
4. In Boston, more condos will be permitted than rental apartments (other than the neighborhoods). [Rental approved by BPDA: 33%/Condo: 67%]
5. An office or lab lease will hit $100 psf in Cambridge. [Boeing office, 314 Main St.: $106.63 Net effective rent]
6. Construction costs, on average, will be up 7%. [Tto date, 6%-7%]
7. More than 1 million sf of commercial space will commence on spec. [Office: Boston & Cambridge: 1,008,000sf; Lab: Boston and Cambridge: 1,226,000sf]
8. The 128 office market will show more transactions (both numbers and sf) than the downtown market. [Downtown wins]
9. Foreign buyers will begin to acquire major CRE property outside of Boston/Cambridge. [No]
10. And, yes, the Patriots will do it again. [Almost!]
