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Real Estate Trends in Central Ohio 2013
Cover Image Source: HOK and Moody Nolan
© 2012 Urban Land Institute
Urban Land Institute1025 Thomas Jefferson Street, NW Suite 500 WestWashington, DC 20007-5201www.uli.org
ULI Columbus1196 Hope AvenueColumbus, OH 43212http://columbus.uli.org
A PUBLICATION FROM:
REAL ESTATE TRENDS IN CENTRAL OHIO SPONSOR:
Real Estate Trends in Central Ohio 2013
TABLE OF CONTENTS
Background 1Survey Respondent Characteristics 1General Business Prospects 2Real Estate Sectors 3Capital Markets 9Central Ohio Submarkets 11How Does Central Ohio Compare? 13
Expected profitability of own business in 2012 vs. 2013
Respondents by Field
Respondents by Sector (multiple selections allowed) Respondents by Position
1
BACKGROUND
Real Estate Trends in Central Ohio takes a pulse of the region's real estate market, including capital markets, various sectors,
and area submarkets. This survey complements the national Urban Land Institute's Emerging Trends in Real Estate, adding an
in-depth local perspective to the national survey's insights on the U.S. economy and real estate markets.
In late September, ULI Columbus distributed a link to an online survey to its full e-mail list, from which 84 responses were
collected from September 26 to October 31. Additionally, 15 interviews were conducted throughout October with key local experts
from the private and public sectors across a range of professional developments, in particular real estate development,
management, finance, and planning.
The information presented in this report comprise quantitative data from the survey and quotes from the interviews as well as the
comment sections in the survey.
Private Developer
21%
REIT 2%
Lender 5% Institutional
Investor 2%
Brokerage 4%
Property Management
1%
Professional Service Firm
31%
Builder 4%
Government 9%
University 2%
Other 19%
Owner 26%
President/CEO 8%
EVP/COO/CFO 5%
Vice President 11%
Director/Manager 23%
Associate 18%
Other 9%
26%
38%
41%
6%
52%
29%
36%
24%
0% 20% 40% 60% 80% 100%
Industrial
Office
Retail
Hospitality
Residential - rental
Residential - for sale
Land
Institution/public
Other responses: development consultant, manufacturing, legal practice, CRE
database, non-profit, non-profit developer for affordable housing, economic
development, architecture, historic preservation, retirement plans, sales rep, real
estate, contractor, market analyst, commercial mortgage banker, media.
Other responses: director, sales, project manager-middle management, partner,
MBA intern on track to become an Associate, staff, attorney, senior designer.
SURVEY RESPONDENT CHARACTERISTICS
Professional service firms represent the largest share of
survey respondents at 31 percent, followed by private
developers (21 percent) and government (9 percent).
Based on the Other responses, the share of professional
service firms could be considered slightly higher.
More than a quarter (26 percent) of survey respondents
are business owners. Generally, respondents range
across different levels from CEO to Associate.
A majority of the respondents (52 percent) are involved
in the rental housing sector, followed by retail (41
percent) and office (38 percent).
Expected profitability of own business in 2012 vs. 2013
Business prospects for industry areas in Central Ohio in 2013
2
0 10 20 30 40
Abysmal
Poor
Fair
Good
Excellent
2013
2012
GENERAL BUSINESS PROSPECTS
Survey respondents and interviewees expect their own
business to do better in 2013 compared to 2012. Nearly
three-quarters (73 percent) of survey respondents expect
profitability to be good or excellent in 2013, compared to
51 percent in 2012.
Interviewees feel similarly positive, though expectations
are also modest. "We are profitable but don’t confuse
what you do well with a great market." "While we’re back-
filling spaces that would’ve been on the market a lot
longer a year or two earlier, I’m not certain of the pricing
power that we’d like to have." "The private sector has
seen challenges to the extent that they have leftover
legacy assets. It puts a drag on profitability."
3.52
3.44
2.94
4.25
3.00
3.00
3.52
3.35
1.00 2.00 3.00 4.00 5.00
Real estate investment
Financing as a lender
Commercial new development
Multi-family new development
Land development
Homebuilding
Real estate services
General construction
Abysmal Poor Fair Good Excellent
Among real estate industries, multi-family new
development has the highest business
prospects in Central Ohio in 2013, with an
average rating of 4.25 (between Good and
Excellent). One interviewee mentions, "We have
a piece of land that attracted six developers and
investors, five of them were multi-family."
Real estate investment and real estate services
are tied for second with an average rating of
3.52, with "good investment opportunities for
people who have cash."
Commercial new development has the lowest
prospects, with an average rating at 2.94, just
below Fair. "To the extent that we’re growing
retail, it is through acquisition." Sectors like
industrial are seeing more activity "on the build-
to-suit side," but "not any speculative
development lately."
Current stage of real estate cycle: INDUSTRIAL
Current stage of real estate cycle: OFFICE
3
REAL ESTATE SECTORS
Industrial and office
In commercial real estate, medical office is the
only sector considered to be in full recovery
mode toward growth. "It’s staggering how
much demand is going to increase for medical
services now that everyone will have access to
health care... It’s not just hospital towers. It’s
the medical office buildings and getting access
to the physicians."
Bulk and distribution space also appears to be
on an upswing. "Columbus is a crossroads in
the planning stages for large scale
distribution." "Big box industrial is the next
logical product. Inventory levels are out of
track." "We're seeing a shift in some of our
largest clients, bringing manufacturing and
distribution back to the U.S. from overseas. It's
about speed to market and quality control."
Most other commercial sectors have bottomed
out and started to recover. "Some of the best
opportunities are probably office, industrial.
They are also some of the scariest, because
how fast is that recovery going to be?"
"Economy is still very slow to spur industrial
and office demand." "The why has to be there."
"Unless it's build-to-suit, it's very difficult to
make the numbers work without incentives."
Suburban office lingers in the most difficult
phases of the cycle. Only 27 percent of
respondents consider suburban office to be at
recovery, growth, or peak, compared to 87
percent for medical office. "Job growth, or lack
thereof, continues to impact office occupancy."
Office may face continued pressure with
growing corporate desire to "limit overhead"
and enchanced technological and design
capabilities for maximizing efficient use of
space.
0
5
10
15
20
25
Bulk/distributionspace
General industrial
Self-storage
Real estate cycle
0
5
10
15
20
25
CBD office
Suburban office
Medical office
Real estate cycle
Current stage of real estate cycle: RETAIL
Current stage of real estate cycle: HOSPITALITY
4
0
5
10
15
20
25 Regional malls
Power centers
Neighborhood/communityshopping centers
Real estate cycle
0
5
10
15
20
25Full service hotels
Limited-servicehotels
Real estate cycle
Retail
Based on the survey, power centers and
neighborhood/community shopping centers are
considered to be faring better than regional
malls. However, mall sector interviewees
disagree. "Regional malls are doing well. It's
really dependent on tenant rolls." These
interviewees emphasize the specific product or
deal. "Top tier retail properties will continue to
trade at strong levels. Mid tier assets in
secondary markets will be hampered."
Creating a social - and perhaps even an
"aspirational, want-based" - experience in retail
is a growing necessity. "We do a lot more
restaurants in our portfolio than ever before.
We like to extend the stay of our shoppers and
make it a more social experience." "We are
looking for amenity-based retail in our mixed
use projects. We want restaurants, athletic
clubs, and other things that create a great
environment for people who work there and live
there."
From the social experience perspective, "power
centers are the most threatened from the
Internet." "They're essentially like commodities,
very tough to differentiate." Best Buy and its
current efforts to reduce store sizes was
mentioned by multiple interviewees.
Hospitality
Despite the new downtown Hilton and the
Joseph under construction in the Short North,
full service hotels are still thought to be at the
bottom of the cycle. One respondent notes that
"the 500 room Hilton will impact the market in
the short term" while another hopes that "this
will not decrease the occupancy rate." Overall,
limited service hotels fare better and may see
more opportunities for growth.
Current stage of real estate cycle: RESIDENTAL - RENTAL
Current stage of real estate cycle: RESIDENTIAL - FOR SALE
Current stage of real estate cycle: LAND
5
0
5
10
15
20
25Luxury apartments
Moderateapartments
Tax creditapartments
Student housing
Real estate cycle
0
5
10
15
20
25Single family lotdevelopment
Single familyhomebuilding
Townhome/condoconstructionReal estate cycle
0
5
10
15
20
25
Land fordevelopment
Farm ground
Real estate cycle
Rental housing
In residential real estate and land, rental housing
is clearly in a growth phase, with student housing
and moderately priced apartments leading the
way.
However, a handful of respondents think that
student housing may already be starting a
downward trend, as "OSU is planning on having
sophomores live on campus and that may have
a negative effect on the student housing near
campus." "If you are in a marginal area, it will
force people to upgrade their buildings, which I
think is part of the university’s plan in trying to
get the sophomores back in the dorms."
For-sale housing
For-sale housing is still at the bottom of the
cycle, though showing signs of recovery, with
"new development of lots starting but at a more
reasonable, cautious pace than 5-10 years ago."
Improvement may be tempered by a long-term
shift "of people realizing that the joy and
supposed benefits of homeownership aren’t all
they’re cracked up to be. It locks you into a
location. It makes it harder to move jobs."
Land
Land development is tracking with for-sale
housing. One respondent expects "newer
residential development in Delaware County in
the next couple of years."
However, the lack of barriers may also suppress
land values, especially on the commercial side:
"There are not a lot of properties I would want to
be a long-term owner of in Columbus because
you can develop 360 degrees. There is always
land to go to the next area." "You look out and
there's land as far as the eye can see, and
especially for industrial, that scares a lot of
people."
Level of construction activity expected in 2013 for institutional/public real estate
Will there be an apartment market bust in the next five years?
Will there be an apartment market bust in the next five years?
(responses by involvement in rental housing industry)
6
2.78
3.54
3.11
3.00
1.00 2.00 3.00 4.00 5.00
Education K-12
Higher Education
State-funded development orredevelopment projects
Locally-funded development orredevelopment projects
Very low Moderate High Fair Low
2.45
2.47
2.43
1.00 2.00 3.00 4.00 5.00
All
Involved in rentalhousing industry
Not involved rentalhousing industry
No Moderate corr.
Major corr.
Minor correction
Yes
No 25%
Minor correction
32%
Moderate correction
26%
Major correction
8%
Yes 9%
Institutional/public
For institutional and public real estate,
higher education will see more
construction activity, including OSU's main
campus as well as Ohio University's new
facilities in Dublin. "A large university and
state capital are as close to recession-
proof as you can get." However, "K-12
educational construction activity will be low
since districts are struggling with budgets,
costs, and resistance to tax increases."
An apartment market bust in the downtown area?
"Apartments, apartments, apartments as far as
Columbus is concerned." "The flavor-de-jour that
everyone’s rushing after."
On average though, respondents expect a minor to
moderate correction to the current rental apartment
building boom. More people responded no (25 percent)
than yes or a major correction (17 percent). "Long-term
trends point towards renewed interest in urban living."
"The occupancy rate for CBD apartments is 98%. There
is demand for this new construction, which will allow for
the supply to fill up rather quickly."
Among the skeptics, one notes: "With the significant
amount of units becoming available at the same time,
developers will be fighting for occupants from a limited
customer base." Another respondent believes that much
of apartment demand "will be dependent on downtown's
ability to attract office users."
The market may transition from quantity to quality and
location. "Multifamily is going to have a bubble soon, but
probably not the urban core." “The customer is sensitive
to the finish level. Because there is so much competition
they are scrutinizing the location and quality."
Survey respondents in and outside the rental housing
industry have similar sentiments about what will happen
with the apartment market, revealing that optimism is not
limited to those working within the sector.
Cap rate trends in 2012 vs. 2013: INDUSTRIAL
Fall Stable Increase
Cap rate trends in 2012 vs. 2013: OFFICE
Fall Stable Increase
Cap rate trends in 2012 vs. 2013: RETAIL
Fall Stable Increase
Cap rate trends in 2012 vs. 2013: HOSPITALITY
Fall Stable Increase
7
2.77
3.00
3.16
3.20
3.11
3.39
1.00 2.00 3.00 4.00 5.00
Bulk/Distribution space
General industrial
Self-storage
2012 2013
3.32
3.55
3.16
3.15
3.25
3.11
1.00 2.00 3.00 4.00 5.00
CBD office
Suburban office
Medical office
3.19
3.09
3.00
3.38
3.14
3.17
1.00 2.00 3.00 4.00 5.00
Regional malls
Power centers
Neighborhood/communityshopping centers
2.80
2.80
2.87
3.00
1.00 2.00 3.00 4.00 5.00
Full service hotels
Limited-service hotels
Capitalization rates
Capitalization rates are considered to have
remained stable since last year, with
average scores slightly below or above 3.00
(remaining stable). "The reason people like
our real estate market here is that it's stable
rental rates, cap rates."
Stability is expected to continue into 2013 for
most sectors, but with a higher possibility for
a modest increase. The office sector, in
which respondents saw the greatest cap rate
increases in 2012, are expected to be more
stable in 2013.
In contrast, every other sector appears to
have greater chances of seeing cap rates
increase. In retail, for example, one
respondent notes: "Triple net properties
have had cap rates compress significantly to
levels that are, surprisingly, at or below pre-
recession levels. That trajectory is
unsustainable."
Bulk and distribution space have the highest
gap in 2013 versus 2012 scores, increasing
0.43 points. Self-storage has an increase of
0.23 points and has the highest 2013 score
among all sectors. At 3.39 though, even self-
storage is not that far above the stable score
of 3.00.
For-sale housing is also anticipated to see
cap rates rise more so than they did in the
past year. The 2013 score for single family
lot development is 0.28 points higher than
2012, and townhome and condominium
construction is 0.23 points higher.
Cap rate trends in 2012 vs. 2013: RESIDENTIAL - RENTAL
Fall Stable Increase
Cap rate trends in 2012 vs. 2013: RESIDENTIAL - FOR SALE
Fall Stable Increase
Cap rate trends in 2012 vs. 2013: LAND
Fall Stable Increase
8
3.04
3.16
3.13
3.22
3.27
3.27
3.25
3.29
1.00 2.00 3.00 4.00 5.00
Luxury apartments
Moderate apartments
Tax credit apartments
Student housing
2012 2013
2.94
3.06
2.94
3.22
3.22
3.17
1.00 2.00 3.00 4.00 5.00
Single family lot development
Single family homebuilding
Townhome/condominiumconstruction
3.05
3.11
3.19
3.22
1.00 2.00 3.00 4.00 5.00
Land for development
Farm ground
Expected change in inflation and interest rates in 2013 and beyond
Expected change in underwriting standards in next 18 months
9
CAPITAL MARKETS
Inflation and interest rates
Survey respondents and interviewees generally do not expect rises in inflation or interest rates in 2013. "The feds said we need
to be in a low interest environment. It helps us heal, that's not going to change." "The only way the government is going to get
out of the economic crisis is to inflate their way out and the way to do that is to print money. That bodes well in the short term for
inexpensive capital."
Beyond 2013, however, respondents and interviewees forecast modest to significant increases in inflation and interest rates.
"We need to position ourselves to capture and lock in as much of the inexpensive capital as we can, and prepare for inflation in
3-5 years." "We will have an inflationary environment and real estate is one of the best hedges against that."
3.36
3.98
3.15
3.95
3.32
4.06
1.00 2.00 3.00 4.00 5.00
Inflation in 2013
Inflation over the next five years
Short term interest rates in 2013
Short term interest rates over the next five years
Long term interest rates in 2013
Long term interest rates over the next five years
Fall Substantially
Increase Moderately
Increase Substantially
Remain Stable
Fall Moderately
0 10 20 30 40 50
Much more stringent
Somewhat more stringent
About the same
Somewhat less stringent
Much less stringent
for real estatedevelopment
for real estateacquisition
Underwriting standards
Underwriting standards for both real estate
development and acquisition are expected to stay
about the same or become somewhat less
stringent, with a small edge for acquisition.
"Lenders will face more pressure to do business.”
However, while "underwriting standards have
leveled out," "finance folks still remember what just
happened." "Developers can’t borrow as much
money as they would like because there are still
underwriting standards related to what we just
went through."
The result is higher expections for a return on
investment. "Even though you have great interest
rates, lenders today are expecting to see real
dollars in these deals."
Expected change in equity capital availability in 2013
Expected change in debt capital availability in 2013
10
3.62
3.54
3.47
3.47
2.97
3.40
1.00 2.00 3.00 4.00 5.00
Commercial banks
Securitized lenders/CMBS
Insurance companies
Non-bank financial institutions
Government-sponsored sources
Mezzanine lenders
Large decline
Some increase
Large increase
No change
Some decline
3.59
3.65
3.71
1.00 2.00 3.00 4.00 5.00
All sources
Public companies and REITs
Private companies
Large decline
Some increase
Large increase
No change
Some decline
Capital availability
Survey respondents expect to see both equity and debt capital to be more available in 2013 compared to 2012. Equity has a
clear edge, with an average score of 3.71 for equity from private companies and 3.65 for equity from public companies and
REITs. "There's always been a lot of equity capital, even through the downturn, but their return parameters can be a lot higher
than where the market is." "Developers have to get used to getting capital from other sources which have higher costs and
expectations."
Among debt capital types, only commercial banks score similarly to equity, with an average score of 3.62. "There's no easy
money...but I don't think there's any real estate sector that's bank loan deprived and cannot do what they want to do, if it's a
good project." Capital from securitized lending and commercial mortgage-backed securities are also expected to increase and
continue their slow but steady recovery since 2007-2008. Interviewee comments ranged from "CMBS is much healthier than it
was" to "back with a vengeance." However, "the Treasury curve is so flat that there is no room." CMBS "is priced far above
agency debt right now." Government-sponsored sources is the only category for which no increase, or any change, in capital
availability is anticipated for 2013.
While global events may seem distant, a handful of respondents and interviewees caution on financial or economic shocks from
Europe or China. "One would think, 'why does Greece affect Columbus, Ohio so much?' If you look at where we get the capital
for most of our projects in the last two years, it's been with capital providers that have international exposure. If something
happens in Greece, that affects them, that affects us."
Prospects for Central Ohio Submarkets in 2013
11
CENTRAL OHIO SUBMARKETS
Best prospects for 2013 and beyond
New Albany has the best prospects in
the region for real estate activity in 2013,
with a rating of 4.00. Beyond 2013, there
will be "growth between New Albany
and Granville over time" along the 161
corridor.
Downtown Columbus and Easton tie for
second place with 3.94. "Downtown will
change in six years." Even with CCAD,
Columbus State, and Hills Market, "the
eastern edge of the Discovery District
has been delayed, waiting for the roads
[new highway ramps] and acquisitions."
Easton will "increase retail stock by 25%
in the next couple of years with major
new retailers. There will also be
multifamily and hotel development."
The North-South Divide
When displayed geographically (next
page), the survey results affirm the
common notion of an arc of growth and
opportunity along the north side of I-270,
including areas such as Dublin, Polaris,
and New Albany. "It's all in the money:
where is the wealth, the demographics,
the best schools?"
The southern part of Central Ohio
generally scores lower. The South Side
of Columbus and Pickaway County have
the lowest ratings in the region, at 2.22
and 2.49, respectively.
4.00
3.94
3.94
3.85
3.79
3.70
3.64
3.51
3.48
3.46
3.41
3.40
3.22
3.17
2.98
2.76
2.74
2.71
2.70
2.63
2.57
2.51
2.49
2.22
1.00 2.00 3.00 4.00 5.00
New Albany
Downtown Columbus
Easton
Dublin
Polaris
Powell
UA/Grandview
North Delaware
Westerville
Gahanna/Airport
Worthington
Hilliard
Columbus-North
Grove City
Union
Groveport/Obetz
Licking
Fairfield
Columbus-West
Madison
Columbus-East
Reynoldsburg
Pickaway
Columbus-South
Abysmal Poor Fair Good Excellent
Prospects for Central Ohio Submarkets in 2013 (map)
12
Powell
3.70 Polaris
3.79
Dublin 3.85
New Albany 4.00
UA/Grandview 3.64
Downtown 3.94
Easton 3.94
Hilliard 3.40
Gahanna/CMH 3.46
Cbus North 3.22
Cbus West 2.70
Cbus East 2.57
Worthington 3.41
Westerville 3.48
Cbus South 2.22
Reynoldsburg 2.51
Groveport/Obetz 2.76
Grove City 3.17
North Delaware 3.51
Union 2.98
Madison 2.63
Pickaway 2.49
Licking 2.74
Fairfield 2.71
Up-and-coming areas
Over the next five years, survey respondents anticipate a mix of established and improving areas to be the most promising:
T-1. Downtown Columbus T-1. East Franklinton T-1. OSU campus development projects 4. Short North 5. Dublin Bridge Street corridor
All these areas share in common a significant amount of development projects or plans in place that will reshape the existing
landscape. Even suburban "Dublin is riding the waves and appealing to the young professionals that work there...allowing for
much denser development."
Demographics and consumer preferences also play a role. "Young professionals are moving into urban environments. They're
interested in rentals for career mobility." "The move is towards being able to live and work in close proximity, and to have the
amenities nearby." "We are focused on both the acquisition and redevelopment of infill locations to capitalize on that
demographic shift."
Central Ohio compared to other U.S. markets by industry area
Central Ohio compared to other U.S. markets by industry area
(respondents active in markets outside Ohio vs. not active)
13
HOW DOES CENTRAL OHIO COMPARE?
Industry areas
Survey respondents on average feel that Central Ohio is doing as well as, if not better than, most other markets. "Central Ohio is
the tortoise. We will never hit the big growth spurts you see in Arizona or Florida. But we are not hitting those real deep troughs
either."
Multi-family new development rates the highest (3.95), followed by real estate investment (3.63) and lender financing (3.56).
Commercial new development (3.23) and land development (3.24) rate the lowest.
Respondents who are active in markets outside Ohio are more critical than those active only in the state or in Central Ohio.
General construction and real estate investment have the largest perception gaps between the two respondent groups, at
3.63
3.56
3.23
3.95
3.24
3.33
3.48
3.50
1.00 2.00 3.00 4.00 5.00
Real estate investment
Financing as a lender
Commercial new development
Multi-family new development
Land development
Homebuilding
Real estate services
General construction
Much worse
Somewhat better
Much better
About the same
Somewhat worse
3.42
3.50
3.17
3.94
3.11
3.12
3.41
3.24
3.82
3.60
3.29
3.96
3.33
3.48
3.52
3.70
1.00 2.00 3.00 4.00 5.00
Real estate investment
Financing as a lender
Commercial new development
Multi-family new development
Land development
Homebuilding
Real estate services
General construction
Active in marketsoutside Ohio
Not active
Much worse
Somewhat better
Much better
About the same
Somewhat worse
0.46 points and 0.40 points,
respectively.
Central Ohio is "not viewed by
institutional capital for significant
long-term appreciation." Also,
"large providers of capital are
focused on core markets
because they want to be able to
liquidate in a downturn."
On the development and
construction side, "southeastern
U.S. business prospects are
best. It’s where people want to
live - best weather, least amount
of debt, coastal access to benefit
from the Panama Canal
expansion."
Central Ohio compared to other U.S. markets by sector
Central Ohio compared to other U.S. markets by industry area
(respondents active in markets outside Ohio vs. not active)
14
3.23
2.90
3.29
3.26
4.08
3.42
3.43
3.55
1.00 2.00 3.00 4.00 5.00
Industrial
Office
Retail
Hospitality
Residential - rental
Residential - for sale
Land
Institution/public
Much worse
Somewhat better
Much better
About the same
Somewhat worse
3.27
2.86
3.33
3.23
4.25
3.00
3.17
3.31
3.20
2.93
3.25
3.29
4.00
3.68
3.61
3.75
1.00 2.00 3.00 4.00 5.00
Industrial
Office
Retail
Hospitality
Residential - rental
Residential - for sale
Land
Institution/public
Active in marketsoutside Ohio
Not active
Much worse
Somewhat better
Much better
About the same
Somewhat worse
Sectors
Central Ohio is seen as a very good place for rental housing real estate compared to other markets, earning an average rating
of 4.08. Most other sectors in the region are seen as performing above average. "Industry says Columbus isn’t the place to build
but for me the prospects look good for this area." However, the office sector rates below average (2.90), further reiterating the
need for job growth and demand drivers.
Unlike the industry areas, there is not a consistent hometown bias for real estate sectors. For-sale housing, institutional and
public uses, and land development in Central Ohio are perceived much more favorably by respondents not active in markets
outside the state. On the other hand, rental housing, retail, and industrial in the region are perceived more favorably by those
active outside Ohio.
What is the biggest impediment to development in Central Ohio?
15
Other responses: overbuilding, economic outlook and aversion to risk,
financing, demand generators, financing, business confidence, lack of demand,
taxes, lack of demand drivers, all of the above, slow growth
Impediments
Building and zoning regulations are considered to be the biggest impediment to real estate development in Central Ohio,
selected by one-third of survey respondents. "Users don't feel confident that municipalities will work with them to encourage
growth and job creation." Several interviewees note issues with regulations and acquiring entitlements, not just with municipal
governments but also with the area commissions in the city of Columbus: "I'm respectful of all the neighborhoods and that they
have the capability not to allow bad projects, but some of these commissions have taken more authority than what's legally
outlined." In general though, most interviewees do not see the situation in Central Ohio as any better or worse than elsewhere.
Building and zoning
regulations 33%
Difficulty finding qualified
workforce 2%
Impact-related fees 7%
Lack of alternate modes of transportation
22%
Lack of available sites
11%
Other 25%
Downtown Columbus regulations are seen as a model.
"Performance-based codes such as the one governing
downtown development would address issues while
allowing significant flexibility." "The planning and zoning
component of real estate development in downtown
Columbus is a model as good as anywhere. The
downtown commission and how they deal with
development is as progressive an approach as you’re
going to find.”
More than 1 in 5 respondents consider the lack of
alternative transportation modes as the biggest
impediment. "There is a magic density number needed
for Columbus. This is one of the big challenges for
mass transit.”
The lack of available sites was selected by 11 percent
of survey respondents, though this is likey due to a
host of reasons. For example, "Upper Arlington,
Worthington, Dublin, Westerville with established
downtowns are becoming increasingly desirable for multi-family, but the challenge is the lack of development sites." On the
outer edges of the region, a number of interviewees feel that land availabiltiy is a strength more than an impediment.
"Columbus has land available. It’s not like Cincinnati or Pittsburgh, where we have topographical problems."
Even without the prompt of a specific answer choice, 11 percent of responses point out the lack of demand drivers such as
economic and job growth, the most common theme among Other responses. "There won't be much new office and industrial
development until existing product is filled." Similar sentiments exist among interviewees: "There has to be demand for your
product. Without that, it doesn't matter if there's capital."
On the supply side, one interviewee points out the detrimental effect of municipal tax abatements on real estate investment.
The current system of full tax abatements for five, ten or more years before an abrupt end often "benefits new projects but
doesn't help existing projects" "We'd like to see a more thoughtful approach, like Indianapolis which gradually burns off 10
percent every year, so that there's not an incentive for a tenant to jump to a new building."
REAL ESTATE TRENDS IN CENTRAL OHIO TEAM
Jung Kim *Research Director Columbus 2020
Courtney Clark *Tax ManagerDeloitte
Justin Metzler * Associate,Davis Wince
Scott Pearson *Student, Fisher College of Business The Ohio State University
MANAGEMENT COMMITTEE
Joseph Reidy *Chair
Jonathan Barnes *Governance Committee Chair
Chuck Basich *Treasurer
Courtney Clark *Sponsorship Cochair
Rachel Headings *Communications Chair
Ralph Ireland *Chair for Mission Advancement
Jung Kim *Programs Cochair
J. Jeffery McNealey *Programs Cochair
Justin Metzler *Young Leaders Group Chair
Kyle Rooney *Sponsorship Cochair
Brian Suiter *Membership Chair
ULI LEADERSHIP
Peter RummelChairman
ULI DISTRICT COUNCIL LEADERSHIP
David MayhoodChair District Councils
ULI COLUMBUS PROJECT STAFF
Alicia Gaston District Council Coordinator
SPECIAL THANKS TO:
ULI Indiana District Council for sharing their survey materials with the ULI Columbus District Council. John Rensink, The Ohio State University, and Rob Vogt, Vogt Santer Inc., for their advisory roles in the initial project design. All the online survey respondents and individual interviewees. Members of the ULI Columbus Young Leaders Group who conducted the interviews.
INTERVIEWEES
Doug Aschenbach *President Campus Partners
William BrennanEVP and CFO The Pizzuti Companies
Pat BowmanDirector of Development City of Grandview Heights
Don Casto, III *Principal CASTO
DJ Effler *Senior Vice President Bellweather Real Estate Capital
Brian EllisPresident and COO Nationwide Realty Investors
Terry Foegler *Director of Strategic Initiatives/Special ProjectsCity of Dublin
Brett Kaufman *OwnerKaufman Development
Marshall Loeb * President and COO Glimcher Realty Trust
Tim Skinner *AssociateThe EDGE Group
Ryan Sullivan *Investment Banking Associate Advoca Capital
Tom Vetter * Student, Moritz School of Law The Ohio State University
Michael MenzerFounder and CEO White Oak Partners
Chad PinnellSenior Vice President Equity
John Royer *President Kohr Royer Griffith
Jim Schimmer *Director Franklin County Economic Development and Planning
H. E. (Ted) Schmidt IIISenior Vice President Grandbridge Real Estate Capital
Jim Schrim *President Wills Creek Capital Management
Yaromir Steiner *Founder and CEO Steiner + Associates
Melanie Wollenberg * Executive Vice PresidentEquity
* ULI MEMBER
Patrick L. PhillipsChief Executive Officer
Marilee UtterExecutive Vice President District Councils
Urban Land Institute1025 Thomas Jefferson Street, NW Suite 500 WestWashington, DC 20007-5201www.uli.org
ULI Columbus1196 Hope AvenueColumbus, OH 43212http://columbus.uli.org
