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1 A WORLD WITHOUT BORDERS Frank N. Simpson, CCIM 2011 CCIM Institute President 5/23/2017 2 Agenda: Presentation I: Welcome & Introduction The Global Real Estate Market Today Presentation II: CCIM Institute Facts Frank N. Simpson, CCIM •CCIM Designated in 1997 – Designee # 7306 2004 president of the 300+-member Georgia CCIM Chapter 25-year Commercial Real Estate Introduction In addition: Economic Development Council of the Greater Hall - Chamber of Commerce Founding President of the Hall County YMCA. Board of Trustees – Wesleyan School Family Wendi, Sam, Mike, Frank United States Economy 2011 What We Read Economy Comments • • • • • • “Economy Remains Sluggish” “High Unemployment “ “Continues Consumers Still Wary” “Foreclosures Pull Housing Market Down Further” “Community Banks Continue to Struggle” “One in ten mortgage borrowers owe more than 125% of today’s value of their home” • “Housing prices have further to slide” • “Say Good-bye to Saturday mail delivery” Economy Comments • • • • • “The “Great Recession” is over” “Retail sales are rising – estimated at 5% annually” “Personal consumption is rising” “Existing home sales are improving” “Industrial production has been rising during the past 18 months” • “Consumer prices are stable and reflect neither inflationary nor deflationary tendencies” • “When will we be at the bottom of the commercial real estate market? Perhaps now – indications are very good” • “Dow to top 12,500 by EOY 2011” RE Market Theme Greed GREED • INSIGHTFUL –Warren Buffett says: “Be fearful when others are greedy; Be greedy when others are fearful” Sector Ratings U.S. CAP RATES DOWN! 14 Home Supply LOOMING DEBT - $1.8 TRILLION Source: Goldman Sachs and REIT filings 2011 Economy • The economy will show more job growth - Private sector up, Government down. • Housing starts increase • More CRE transactions • Dow up • US dollar strengthens • Federal Government zero interest policy continues • United States will see 3-4% Growth in 2011 (Bernanke) • On and On Is the Recession over? • Technically Yes – 2 Qtrs. Of Positive GDP growth, But… • • • • Slow/Prolonged Recovery Unemployment Still Too High! Devaluation in Pricing still to occur More deals happening. 2011 vs. 2010 – Differences There is Less Competition! Globally, prices are lower, still have some downward pressure U.S. is starting a recovery Capital Markets: Bad, but not as bad as ‘08. Global Economy - Varies 27 Ken Riggs, CCIM CCIM – Chief Economist • “The recovery will vary by geography and property type, but for investors seeking to seize market opportunities, 2010 & 2011 will be the best time in generations to buy well-priced, quality commercial real estate,…Investors should view 2010/2011 as a once-in-a-lifetime opportunity to snag key long-term investments.” 29 Largest Network on Earth Commercial Real Estate Partners Realtor Stats • 2006 Peak of 1.5+ million Realtors • 2010 1,063 Million Realtors • 30+/- Percent Decrease Countries with courses & members Countries with members International Membership New CCIMs in Taiwan • 1500 International Members • 36 Countries • Courses: Russia, Poland, South Korea, Canada, Mexico, Dubai, Egypt, Taiwan, China • Studying Vietnam, India CCIM Institute Equipping the best minds in commercial and investment real estate. 47 A CCIM is elite • Only 6 percent of estimated 150,000 commercial real estate practitioners nationwide hold the CCIM designation 48 To earn the CCIM designation: Member must become a Candidate Pass four core courses (take or challenge) Take 200 classroom hours Earn three elective credits Submit a Portfolio of Qualifying Experience Pass the comprehensive exam CCIM Education Premier commercial real estate education Over 18,000 students Outstanding instructor cadre of real estate practitioners CCIM Education Premier commercial real estate education Over 18,000 students Outstanding instructor cadre of real estate practitioners $2.6 million curriculum redesign CCIM Education Premier commercial real estate education Over 18,000 students Outstanding instructor cadre of real estate practitioners $2.6 million curriculum redesign Online education offerings CCIM Education Premier commercial real estate education Over 18,000 students Outstanding instructor cadre of real estate practitioners $2.6 million curriculum redesign Online education offerings CCIM Education Premier commercial real estate education Over 18,000 students Outstanding instructor cadre of real estate practitioners $2.6 million curriculum redesign Online education offerings Non-designation education Location. Location. Location. Multiple course offerings annually Location. Location. Location. Multiple course offerings annually Primary and secondary cities Location. Location. Location. Mulitple course offerings annually Primary and secondary cities More than 50 markets worldwide Location. Location. Location. Multiple course offerings annually Primary and secondary cities More than 50 markets worldwide Three continents CI 101 - Financial Analysis Cash flow model Time value of money Appraisal Investment value and performance Tax implications Internal rate of return Net present value Compounding and discounting CI 102 - Market Analysis Evaluating the market Market analysis model Market data and GIS Supply and demand factors Property types Technology Site selection and feasibility Mapping and demographics CI 103 - User Decision Analysis • Lease terminology Leasing versus owning Buying versus building Lease valuation Lease comparisons Transaction management and alternative user decision process CI 104 - Investment Analysis • Investment as a process Tax implications Disposition options Acquisition strategies Profitability ratios Valuation Asset management Impact of financing and risk Training Customized Colliers Corporate Training Training Re/Max CB Richard Ellis ICSC Coldwell Banker GVA Grubb & Ellis CREW Network Ernst & Young GE Real Estate Wal-Mart Walgreen's McDonald’s AEGON Educating the Industry Worldwide 65 CCIM Networking Close more deals Grow your network Expand your knowledge Gain industry recognition Increase your net worth GIS – What Is It? • A geographic information system (GIS) integrates hardware, software, and data for capturing, managing, analyzing, and displaying all forms of geographically referenced information. • GIS allows us to view, understand, question, interpret, and visualize data in many ways that reveal relationships, patterns, and trends in the form of maps, globes, reports, and charts. GIS – Why Use It? • GIS can integrate and relate any data with a spatial component, regardless of the source of the data. • Rather than you working hard to understand your data, GIS puts your data to work for you. GIS can provide you with powerful information -not just how things are, but how they will be in the future based on changes you apply. CCIM Russia Model to CCIM for International Growth Important Political Partner to U.S. Expect Russia’s Impressive Growth & Expansion To Continue 96 JOIN & BE ACTIVE IN CCIM! • WE ARE THE SOURCE FOR EDUCATION IN COMMERCIAL REAL ESTATE – Everyone in CRE should attend! • Networking – WORLDWIDE – GLOBAL OPPORTUNITES