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Vacancy Rates 1st Quarter 2021:
Office. Warehouse. Retail. Hotel. Land.

Commercial real estate research. California Commercial Real Estate Survey - UCLA Anderson Forecast.
Commercial real estate research. Federal Reserve Bank of San Francisco - Economic Research.

PROJECTS UNDER REVIEW (Password Protected)

- Millbrae 10 Acre School Site.

- Redwood City Multiplex Site.

- Menlo Park 3.5 Acre Condo / Retail Site.

- Hayward Transit Oriented Development Approved.

- Berkeley Site for Retail / Multi-Family.

- Emeryville Site for Retail / Office / Multi-Family.

"Recent declines in cap rates appear to be signaling a commercial real estate rebound, indicating improved investor expectations of price growth in the market."  

David Lang, Federal Reserve Bank of San Francisco.

Real Estate Developers Need to Properly Prepare to Take on Community Opposition

Community opposition is a powerful force that can kill a real estate development project in its tracks, costing real estate developers a significant amount of money. When it comes to dealing with citizen opposition, real estate developers often fail to counter it by using the same dependable principles they use every day to achieve success in business.

Putting together a real estate deal is often based on predictable and measurable criteria like lot size, comparable values, cost, potential profit and return on investment. Citizen opposition to a real estate project, however, is often unpredictable, indefinable and emotional. There are no metrics by which you can gauge the impact of angry protests and virulent letters to local newspapers. Often, even polls are not able to draw a conclusive, accurate picture of public opinion about a real estate project. However, there are techniques that have proved very successful in diffusing the anger and hostility, lies and misinformation engendered by the NIMBYs (the people whose motto is "Not in My Backyard"), environmental groups, property owner associations and neighborhood councils that may line up in opposition to a real estate project.

A real estate developer needs to create an aggressive but honest strategy to deal with the problem of citizen opposition. The real estate developer should be prepared to change that strategy as the situation warrants. The real estate developer needs to retain specialists who have successfully taken on citizen opposition before — and who have a clear history of winning. The real estate developer should be prepared to adequately fund the implementation of the strategy to insulate the real estate development from the opposition's barrage of negative attacks and to go on the offensive.

The strategy begins with good intelligence on the ground. Find out exactly who is opposing your real estate project and why? Who is funding the opposition and why? What are their specific goals? Often, businesses concerned about competition coming into their market will pool their money and resources to fight the real estate project and they will create a political action committee or a public interest group.

In 2001, for example, The Home Depot had plans to build a 200,000-square-foot store in Agoura Hills, California, as an anchor to a larger retail project. Local businessmen, with a financial interest in keeping the retail giant out of their market, quickly formed a public interest group called "Citizens for Responsible Growth." They took on The Home Depot and the real estate developer in an aggressive marketing and political campaign by coalescing a united front of homeowners, local environmentalists and slow-growth activists against the real estate project.

The Home Depot hired a comparatively inexperienced firm that sent out bland, confused messaging in poorly designed brochures and mailers. They missed the mark by not gleaning intelligence about the opposition and communicating the real benefits of their store to local citizens. The Home Depot lost an important vote at the ballot box. The real estate developer was prevented from building the retail center. The land stands vacant to this day.  Good intelligence will go a long way towards your eventual success. Find out who the key players are in the opposition's camp — and find out all you can about them. Who is coordinating the campaign? Who is writing the checks to fund the campaign?

Identify which homeowners associations are for, or against, the real estate project and give informational presentations for the HOA board members and the environmental groups as soon as possible. The opposition will be doing the same. If the city is on record supporting your real estate project, its staff can be very helpful in this regard, providing background on 'who is who' in the community and why they may be against, or even better, why they might be 'for' the project. There are allies out there. Find them and recruit them on your behalf.

Enlist the help of experienced public relations, public affairs and marketing experts. You'll need to communicate often to the citizens, and the way your message is created, shaped and delivered will affect how the public perceives the real estate project and you, the real estate developer. Meet with the editors and reporters of the local newspapers and brief them often on the project's progress. Make sure they are aware of the key message points about the benefits of the project to the community. Keep them in the loop. Respond to negative letters to the editor with your own positive ones. It's important to be factual and on target with your message. It's OK to address head-on the real issues of concern to the public, such as traffic, parking and size, but deal with them forthrightly and honestly. Be positive. Look for the silver lining in everything. Discuss openly, and often, the benefits of the project to the city, including potential sales tax revenues, street improvements and infrastructure enhancement. Don't be afraid to take on the opposition in an aggressive, and factual, way.

One real estate developer who spent a million dollars in a losing battle against citizen opposition for his retail project in central California said, "We were too nice — and we lost. If I had to do it all over again, I would have been more aggressive and slugged it out in the arena of public opinion. We had many facts in our pocket about the opposition that we didn't disclose. I think it would have made all the difference."

These days almost any new real estate development, especially retail, will bring to the surface organized and angry public opposition. Expect it. Deal with it. Counter it. Never underestimate the influence of citizen opposition on local politicians whose vote you need for the entitlements you seek. It's easier to get neighbors riled up against something, especially a real estate development that may include a big box store, than to convince residents to be for something, unless it directly affects their pocketbooks.

PR expert Al Abrams provided above insight into how real estate developers should tackle community opposition to new real estate projects. Abrams is President of Abrams Creative. Any and all copyright related thereto should be attributed accordingly.