Eric Paulsen, President of NAIOP SoCal and regional president at Kidder Mathews, recently raised concerns about the lack of engagement from the commercial real estate industry in legislation that could negatively impact its interests. In an interview with Connect CRE, Paulsen discussed examples of harmful legislation at the state and local levels and emphasized the need for industry members to take action.
When asked about successful efforts to shape or oppose legislation, Paulsen highlighted NAIOP SoCal’s defeat of AB 1000 which would have severely limited warehouse development in California. He also mentioned two bills currently sponsored by NAIOP SoCal: AB 2904 which aims to increase transparency for property owners when cities propose zoning changes; and AB 2433 which would expedite permitting processes if a local agency fails to meet deadlines.
Paulsen stressed that apathy towards political issues is costing the CRE industry billions of dollars. He urged members to stay informed on pending legislative issues and take action by contacting lawmakers or financially supporting advocacy groups like NAIOP SoCal. By doing so, he believes that positive change can be achieved for both individual businesses within the industry as well as society as a whole.
NAIOP Southern California President Eric Paulsen recently expressed concern over lackluster engagement from commercial real estate professionals in regards to potentially damaging legislation affecting their interests. In an exclusive interview with Connect Commercial Real Estate (CRE), Mr.Paulson delved into this issue while offering potential solutions.
Q: Is there any specific type(s)of legislature causing harm?
A: Most detrimental legislature affecting our field originates locally rather than nationally due largely impart because politicians often attempt solving problems using incorrect methods without fully understanding potential consequences resulting economic damage outweighing benefits .
Examples include:
For four consecutive years now ,NIAPO has had deal with statewide laws threatening shutdowns across all warehouses throughout California leading job loss hurting economies . The most recent version being Assembly Bill 1000. NIAPO SoCal has been able to mobilize thousands of members and allies in opposition to this bill by contacting state legislators . Although we were successful in halting AB 1000 , the author Assemblywoman Eloise Reyes is determined continue pushing for its passage. We must be prepared respond with logical counterproposals, educate those not familiar with commercial real estate on harmful impacts of such proposals, and rally support for retraction.
At a local level industrial properties have become targets as several cities consider implementing warehouse moratoriums while simultaneously seeking downzoning measures which severely restrict building size or tenant occupancy rights without notifying property owners or conducting economic impact analysis.
In Los Angeles Measure ULA was passed affecting all types of property imposing taxes ranging from four percent on sales valued between five million dollars but less than ten million dollars; up to five point five percent on anything over ten million dollars . These new taxes are crippling growth development within LA .
In twenty twenty one South Coast Air Quality Management District (SCAQMD) adopted indirect source rule (ISR) creating complex regulations governing over three thousand warehouses requiring either truck emission reduction through electric trucks use or substantial payments made directly SCAQMD costing roughly dollar per square foot totaling nearly billion annually . No plan presented how these revenues will be spent ; most assume wealthy targeted however costs ultimately transferred consumers .
Q: Has there been an increase legislation enacted recent years? If so why?
A: Commercial Real Estate is being portrayed negatively often labeled as wealthy individuals damaging environment generating jobs ,or corporations needing contribute more resolving socio-economic issues plaguing our cities. CRE now viewed revenue source much legislature simply money grab supporting other causes local agencies seek funding increasing general fund budgets WAIRE point system example where no matter compliant industrial building may attempt mitigating items demanded operator ends writing checks city
Political apathy towards legislative affairs resulting billions lost industry due lack resistance/opposition allowing detrimental laws pass unnoticed. In recent years more harmful legislature passed than ever before while CRE industry stood by.
Q: How can associations help keep members informed?
A: NIAPO SoCal has devoted significantly resources towards legislative affairs advocating our field front city state officials testifying Planning Commissions, City Councils State Legislature . We also update members pending local state issues rallying support testify before jurisdictions demonstrating government leaders actions matter .
Often legislators unaware impact their proposed bills may have . One San Francisco politician attempted banning commercial tenant evictions during COVID-19 pandemic which would’ve rendered every contract within California null void order save his favorite restaurant .
Measure ULA Los Angeles failed generate expected funds instead deterring investment city resulting seventy percent drop transaction volume ; sale transactions reset property tax basis properties. Not only is it failing raise hoped for revenue but stifling new investments minimizing potential recurring taxes.
It’s simple politicians want reelected weigh issue side largest voting block either against that issue. Members must make calls , send emails educating others unfamiliar with our industry about upcoming legislation and if possible financially supporting groups doing above mentioned activities
Q: Can you provide an example of successful involvement in shaping or opposing legislation?
A: Yes! NAIOP SoCal successfully defeated AB 1000 preventing warehouse development shutdown across all California mobilizing thousands of members allies contacting legislators opposition to this bill however battle far from over.
For first time history sponsoring two bills State Legislature :
AB 2904 increases transparency doubles notification period statewide when cities propose zoning changes impacting property value use mid-May unanimously passed Assembly now Senate
NAIOP SoCal CBPA sponsored AB2433 “California Private Permitting Review Inspection Act” expediting permitting plan check processes allowing developers utilize private professional services should local agency fail meet thirty day deadline unanimously passing three Assembly Committees pushing approval by assembly goal get signed into law these playing offense when impacts every single person daily willing make phone call brief email difference
