Dockless Transportation Might Be Your CRE Property’s Next Great Thing

It’s convenient, cheap, and riders love it

For the consumer, it’s beautifully simple—rent a bike or scooter for as little as a dollar using a free app on your phone, pick it up at one of the numerous locations across your city, and drop it anywhere when you’re done.

Welcome to the era of dockless, urban transportation, the latest iteration of the sharing economy. Rather than shoulder the cost of car ownership, or sit in an Uber or Lyft on increasingly congested streets, some urban commuters instead opt to get around using such startups as Lime, Bird, or GoBike.

The appeal

The scope of the trend goes beyond scooters and bikes and includes motorized skateboards, e-unicycles, and electric tricycles. This marks a shift from the pricier and less-flexible docked systems which had previously been the standard in many U.S. cities. The non-electric, kick-scooter wing of the industry is also seeing growth.

The dockless movement has much promise, and provides many amenities to city-dwellers and tourists:

• A much-needed extension of public transit, dispersing bikes and scooters into neighborhoods where subways and buses can’t or won’t go.
• The solution for quick, short trips where a personal car or Uber isn’t necessary, be it to the corner store or grandma’s house in the next neighborhood.
• Convenient access, with simple apps and cheap rates.
• Good for the environment—more scooters mean fewer cars on the road.

The complications of dockless transportation

While users rejoice at having a scooter or bike around every corner, it can be a little more complicated for cities and towns. Initially, entrepreneurs dropped these bikes where they pleased around a city and let customers come to them. But this has led to a number of concerns:

• “Bike litter:” riders drop the bikes in the middle of streets, sidewalks, and on personal and commercial property.
• Rider safety: helmet laws or best practices still apply to these vehicles but many riders, particularly tourists, eschew them.
• Pedestrian safety: while electric scooters are legally confined to roads or bike lanes, riders sometimes opt for more convenient sidewalks.

Several South Florida municipalities such as Miami, Coral Gables, and Fort Lauderdale are working with dockless providers to address these issues and ensure safe travel conditions for all.

Landlords and owners want in

Investors and landlords alike see potential in the dockless transportation boom. It makes their buildings more accessible and welcoming, particularly when they’re perceived as a bit off the path from public transit.

And for residents who are elderly, have young children, or physical disabilities, bike or scooter-sharing can be a great alternative to driving or walking. Many scooters in particular are light-weight enough that a tenant or worker can bring them from work to home, even if that commute includes a ride on the subway or a bus.

CRE investors and managers considering adding shared transportation to their offerings should have a multi-faceted strategy:

• Parking or storage zones. Be a part of the “bike litter” solution by providing a convenient place for people to drop their dockless vehicles. You’ll keep your own property clear and help solve a larger problem.
• Smooth sidewalks and entryways. A level surface for riders reduces injuries and shows your commitment to tenant safety.
• Proactive government cooperation. Petition your local municipality to add bike lanes, charging stations, and helmet lockers in the community.

CRE embracing transportation innovation

Proactive CRE investors will see the value of the dockless trend and, in doing so, provide access to their properties for a wide variety of new potential owners and renters. Considering the dueling statistics that the population of Americans age 65 and older is expected to double by 2030 and that a fifth of Americans are under 18, this proposition seems to be a win for attracting both ends of the age spectrum.

Morris Southeast Group keeps an eye on trends in South Florida and beyond that can impact commercial real estate investment and property management. For a free consultation on our commercial real estate investment or property management services, call us at 954.474.1776. You can also reach Ken Morris directly at 954.240.4400 or via email at kenmorris@morrissegroup.com.

Unused Golf Courses are a South Florida CRE Opportunity

Abandoned golf courses are prime opportunities for redevelopment—but be ready to get environmental remediation and community buy-in

When Tiger Woods won the Masters in April, golf course owners across the country hoped it would be “the putt heard ‘round the world.” The sport has seen a steady decline in interest since its heydays from the late ‘70s to early ‘90s. As a result, courses have been forced to close, and many homeowners—who spent top dollar for a home with a view of the greens—are now paying for an amenity that no longer exists.

Developers, meanwhile, have taken notice of these vast tracts of underused land. They are often the last available open spaces in heavily populated areas, and many are surrounded by affluent communities that were once paired with the course. The question, then, is: What can you do with the land, and how best to do it?

Site remediation is the greatest challenge to golf course redevelopment

The risk to redeveloping a golf course is what lies under the new development. Maintaining a perfectly manicured landscape requires an overwhelming amount of chemical fertilizers, pesticides, and herbicides. Over the decades, these chemicals build up in the soil and groundwater to levels that can be unacceptable for certain kinds of redevelopment. Be sure you’re prepared for strict environmental due diligence before flipping a golf course.

The type of development and zoning can make a difference in the environmental remediation required. Since many courses already had restaurants and shops, it’s relatively easy—in terms of zoning—to redevelop an abandoned course into a retail center where much of the land will be paved over. The same can hold true for industrial development on the property (although surrounding communities may oppose such usage).

Developing a golf course into residential space is the most challenging option but it’s also the most financially appealing. An 18-hole course is approximately 150 acres, which can accommodate 600 detached single-family homes. With the addition of townhouses and apartments, this sort of development can mean thousands of new residents.

3 key steps to successful golf course redevelopment

While many municipalities may be eager to see something on this vacant land—and very willing to negotiate—there are some expensive and delicate items developers should be ready to address:

1. As stated earlier, golf courses can accumulate a lot of toxic chemicals. A developer should work with an environmental consultant who is familiar with golf course remediation. A Phase I Assessment will include soil and groundwater sampling of tees and greens. If high levels of toxins are found, the consultant can recommend a Phase II Assessment.
   
   In the case of extensive contamination, developers may have to work with their state’s environmental protection department to create a remediation plan/timeline that may also include future monitoring. Once contamination has been corrected, development can continue.
   
2. Any development is a NIMBY issue (i.e. “Not In My Back Yard”), literally, for surrounding golf course communities. It’s in the best interest of developers to work with those communities, be transparent, gain a better understanding of their concerns, and find mutually amicable solutions. Those solutions might include removal of toxins, the creation of a landscaped buffer zone, or a smaller golf course.
3. Developers must also work with local water management agencies to close irrigation wells that were used to feed the green. These are no longer needed and can present environmental risks.

South Florida’s golf game

When it comes to Florida real estate, year-round golf has traditionally been a huge reason many people choose to reside in the Sunshine State. But while residential non-golf development has remained steady through the sport’s waning decades, a number of communities that once looked out over manicured greens now have a view of weed-ridden fields.

Many community members enjoy this wide-open view, whereas others would like to see the land become a public park. This can put a financial strain on cities to purchase that land, develop it into parkland, and maintain it, however.

Developers with vision and an ability to navigate city zoning and community wishes hold the key to smart and profitable golf-course redevelopment. The Morris Southeast Group team can help you create these new links for old links. To learn more about our property investment opportunities and/or other services, call us at 954.474.1776. You can also reach Ken Morris directly at 954.240.4400 or via email at kenmorris@morrissegroup.com.

A Property Management Firm Eases South Florida Landlord Headaches

You and your tenants may sleep better when you leave the details to professionals

You’ve landed a prime property in a great location. On the surface, it seems like an easy, consistent revenue source that diversifies your portfolio and builds equity. And whether it’s residential or commercial, it can be tempting to take on all management duties yourself—this saves money and gives you confidence that every detail is just right. But a closer look at the details of what professional property management offers may lead you to a different conclusion.

Why consider a property management firm?

While property management may seem economical and fairly simple on the surface, there are a number of instances where hiring a manager may be the smarter course of action:

• The number of units has grown (this is good!) but to a level that the landlord can no longer manage (not so good…)
• The property is in a different city or state, or perhaps on another continent.
• You need someone to handle day-to-day operations (simple maintenance, rent collection), which frees you up to focus on larger concerns such as marketing, staffing, and acquisition of additional units.
• You need dedicated expertise in issues of rental law, including federal and state fair housing regulations.
• You need someone with a deep understanding of both industry best practices and the local market, either through personal knowledge or a network of fellow professionals.

The cost for these services typically includes fees for basic setup, leasing, maintenance, and other management duties.

Maintenance services are a key element of professional property management

A property manager will be your eyes on the ground, making sure routine maintenance is in check and tending to emergency repairs that may be needed. A quality manager has a list of vendors which provide fair rates and service records. These vendors will share a vested interested in providing good service in order to maintain their preferred status with the management company.

Managing tenant relations

Your residential or commercial tenants will likely appreciate a management company that’s focused on their needs and not a landlord who’s spread thin with competing for career or business priorities. Best practices are to make contact about four times a year, updating tenants on the relative health of the property and any current maintenance or safety issues, and generally keeping open channels of communication.

Managers can also intercept and dispense with any frivolous complaints (loud neighbors, construction across the street, etc.) that will take up your time. And more serious issues must be addressed in a timely manner to meet legal responsibilities.

Rent and lease management

Property managers can handle arguably the most tedious and frustrating aspect of rental property ownership—collecting the actual rent. If the check comes on time in the mail or payment shows up automatically online, that’s great. But on those occasions when it doesn’t, you don’t spend hours tracking down tenants, enduring excuses, and possibly regretting the investment in the first place.

A management company can help set policy about late rent and oversee the process of warnings and, if necessary, eviction, that comply with state and local law. It can also enforce other terms of the lease, such as noise violations and unauthorized alterations to the property.

Finding new tenants is a service offered by quality management companies

Without reliable, productive tenants, the most beautiful property will sit idle and devoid of life. The process of finding ideal tenants can be unpredictable and frustrating—placing ads, screening applications, interviewing tenants, and coordinating on-site visits. A management company can take this onerous task off your plate or, at a minimum, significantly augment your efforts to ensure occupancy remains consistent.

Property management is a worthwhile investment for South Florida CRE

In the end, it’s crucial to understand the scope of responsibility inherent in property self-management. While there may be some up-front cost savings, the long-term time commitment and aggravation often tip the scales towards hiring an outside firm to do the heavy lifting. Morris Southeast Group provides comprehensive, professional property management that can make the difference between marginal and successful real estate investment. For a free consultation on property management services or commercial real estate investment, call us at 954.474.1776. You can also reach Ken Morris directly at 954.240.4400 or via email at kenmorris@morrissegroup.com.

4 Reasons to Future-Proof Your Property

Connectivity, innovative use of space, and the environment top the list

In the modern age of disruption, no business is immune to the ever-increasing pace of change. Commercial real estate is no exception, and a current trend cascading through the industry is the concept of future-proofing—designing (or redesigning) your property to adapt to changes in the habits of renters and entrepreneurs, the shifting of our climate, and our communication needs in a 24/7 connected world.

South Florida has seen ample opportunities—and challenges—in future-proofing its CRE market. Tenant demand has soared in recent years, for example. This has turned developers’ attention towards the dilemma of how to mindfully increase urban density in a way that accommodates the as-yet-unknown needs of future generations.

Let’s take a look at four of the issues that are shaping the future of CRE:

1. Rethinking mixed-use real estate

If the future-proofing movement could be summarized in a single word, it might be flexibility. How we work, shop and live is in a near-constant state of flux which poses a challenge for property owners who need to make decisions—before a shovel even goes into the ground—about how their building will be used by tenants and the public. Thoughtful design can mitigate many of these variables.

A property’s relevance will be determined by its owner’s ability to change with the times, adapting to new kinds of tenants, new uses, and even a new climate. This has made developers rethink the traditional “mixed-use” property, where a building may have predetermined functions assigned to each space (retail, restaurant, residential, parking).

Instead, they are beginning to lean more towards “multi-use,” which may look a lot like the modern hotel, where the same space houses multiple functions such as conference rooms, mini-bars, fitness centers, business nooks, and overnight accommodations.

2. Adapting to shifting renter preferences and parking needs

Unlike tenants of years past, today’s residents are less concerned about the size of their units than the flexibility of the common spaces that accompany them. They are more inclined to take the party into the lobby rather than confine it to their apartments. Traditional fitness centers often remain empty or lightly used, leading some managers to repurpose the space to accommodate both exercise and coworking.

As Uber, Lyft, and public transit change the face of driving, the exact future of the parking garage is also changing and uncertain. In their current form, most underutilized garages only have second lives as storage facilities, but forward-looking designers can ensure that future parking structures have proper ventilation, lighting, and space for conversion into rental or office units. The top level of a garage has a multitude of uses, from a roof deck suite to an urban garden.

3. Connectivity is a priority for CRE

In an increasingly wired world, a near-universal demand of business and residential tenants alike is the high-speed Internet. Newer construction projects build this into their framework but older buildings face a challenge meeting this growing need. Nevertheless, it should rise to the top of the developer’s to-do list when courting occupants now and in decades to come.

Increased connectivity also necessitates increased cybersecurity. With dozens or perhaps hundreds of users online at once—and the rise of smart devices and the Internet of Things (IoT)—a network’s vulnerability increases. Maintenance crews and third-party vendors also need access, making attention to password protocols and multifactor authentication important for a safe online experience.

It also means higher electric bills. A generation ago, people owned few electronics and certainly had no need to charge multiple devices at once. From surge protectors to additional wall outlets, there are many quick fixes modern developers can make to accommodate tenant expectations.

4. Environmental stewardship must not be forgotten

Florida is no stranger to the environmental impacts of our ever-shifting climate and its CRE industry has noticed. State leaders have taken proactive steps to future-proof buildings and communities, particularly in low-lying coastal areas. In Miami, these include a $400 million government bond and a voter-approved residential tax to lessen the effects of storm surges and coastal flooding.

North Miami has gone so far as to partner with the Van Alen Institute, a design-centric non-profit focused on urban improvement. Together, they aim to find creative solutions in the development of repetitive loss properties—vacant lots that are increasingly prone to floods.

South Florida CRE design for the future

Alongside flexibility, longevity is the other essential term in future-proofing your property. Make the building last, both in its structure and utility. It should stand strong and vibrant 20, 30, and 50 years from now. Thoughtfully designed now, for the future. Morris Southeast Group will work with you to develop a property that lasts for generations to come. For a free consultation on commercial real estate investment or property management services, call us at 954.474.1776. You can also reach Ken Morris directly at 954.240.4400 or via email at kenmorris@morrissegroup.com.