Speaking of Real Estate
Does the area you live in have a clear evacuation plan and resources in place in case of a catastrophic event? No one can prevent a disaster, but planning and a strong understanding of what it means to be resilient can make all the difference.
On Aug. 29, the country marks 10 years since Hurricane Katrina leveled 500,000 homes in New Orleans and the Gulf Coast, creating $41 billion in property damage and displacing more than 1 million people.
Since the Category 5 hurricane struck the Big Easy, the city has installed a $14.5 billion system of levees, flood walls, and pumps. Redevelopment in New Orleans’ nine main residential communities has cost $1 billion, and the population is back to 90 percent of what it was before the storm.
These efforts among local, state, and federal governments; public and private organizations; and individuals are all part of what experts call a “resilience effort.” And it appears that such movements aren’t limited to Louisiana. They’ve gained traction across the country.
During a recent webinar, representatives from the Urban Land Institute defined resilience as “the ability to prepare and plan for, absorb, recover from, and more successfully adapt to adverse events.” Resilience includes both recovery and improvement: what can and should happen before, during, and after hazardous events such as flooding, wildfires, winter storms, and tornadoes.
In order to build resilience in areas prone to disasters, ULI’s Byron Stigge listed six steps to help towns and cities assess risk. The idea of risk is based on the concept of the probability of an event (percentage) multiplied by the damage from the event ($), although damages such as health issues and the reputation of a city can’t always be determined monetarily.
- Define types of relevant hazards: The events that typically happen in the Midwest are different from those on the West Coast, for example.
- Define event scenarios: Are the hazards very likely to happen (10 percent annual probability), moderately likely (1 percent annual probability), or highly unlikely (0.2 percent annual probability)?
- Identify affected assets: These assets can include response facilities such as police stations and hospitals, infrastructure, and operating facilities, including government buildings and schools.
- Assess the damage to each asset: Direct impacts can include property damage, inventory losses, and loss of life. Indirect impacts can include reduced home values, higher insurance rates, and job losses.
- Calculate annual risk exposure: How much money would have to be spent on each asset after each type of hazardous event?
- Calculate cumulative risk exposure: Analyze what the damage will be 10, 20, and 50 years from now.
These steps are meant to reduce the risk of catastrophe as much as possible. However, Jim Heid of UrbanGreen, a San Francisco-based sustainability consultancy, noted that “much like sustainability, resilience is … really something that’s never achieved, but it’s something we continually work toward over time.”
Heid stressed the importance of examining actions needed for different types of rural or urban landscapes. He said often it’s smaller communities that need the most resources, but they rarely have the ability to handle them. Strategies that are applicable for a wide range of communities include avoiding new development in high-risk areas, anticipating events by having resources available, and accepting that some challenges are unavoidable.
Though these steps toward resilience seem intended for local government officials, it’s important to be aware of the planning that may be happening in your community. For real estate professionals and home owners, these plans can be an important factor when looking to buy, sell, or show a home. When Hurricane Katrina struck New Orleans, the city had weak, out-of-date levees and an insufficient evacuation plan. Now, with a resilience movement long underway, the city has collected data to determine which areas need evacuation first in the event of another disaster. It has an evacuation plan, which was tested in the wake of Hurricane Gustav in 2008, to move every resident out in 36 hours and bring them to shelters with food.
I’ve never really experienced Washington, D.C. aside from a family vacation there about 20 years ago, but that all changed when I was invited to attend the White House Demo Day — where innovators around the country pitched their ideas to none other than President Barack Obama.
The event was hosted by Megan Smith, chief technology officer for the United States, as part of the SocialMedia.org contingent of digital marketers from some of the world’s largest companies. I was invited to participate in this event to represent Coldwell Banker Real Estate, and obviously when you are invited to a meeting at the White House, you can’t help but be excited.
Before we got down to business, I took the opportunity to take a selfie with a picture of Obama in a White House meeting room so that I could report back to family and friends that I did, indeed, get a selfie with the president. As I sat there soaking in every second of this once-in-a-lifetime opportunity, I decided within about 20 minutes that this day had already solidified its spot on my list of top 10 life experiences.
Smith entered the room accompanied by a diverse group of business thinkers who she and Obama invited to showcase their startups and shed light on how important the entrepreneurial spirit is to the future of America.
In her opening remarks, Smith focused on the need to welcome more women and ethnic groups into the entrepreneurial ecosystem. She cited several jarring statistics:
- Just 3 percent of America’s venture capital-backed startups are led by women; less than 1 percent are led by African-Americans.
- Four percent of U.S.-based venture capital investors are women.
- Of 300 companies surveyed in a recent case study, those with a woman leader performed 63 percent better than all-male teams.
Wow, so inclusivity is not only the fair thing to do — it is also the most profitable.
As we listened to the entrepreneurs share their achievements, it was astounding how strong their perseverance and desire to overcome obstacles were. They included Albrey Brown, who created a coding boot camp for African-Americans, and two women from online job board The Muse who revolutionized how millennials go about their job search.
But as I sat there, I realized that one industry was completely missing from the conversation: real estate. Why? Aren’t real estate professionals the ultimate entrepreneurs? Aren’t we the champions of perseverance? We’re no different than the founders of The Muse, who were rejected 148 times before they received funding for their idea. While we don’t usually deal with angel investors or venture capitalists, I think you will all agree the daily grind we face from buyers and sellers is an equal — if not tougher — challenge.
Those in real estate are the backbone of America. We shouldn’t be ignored when it comes to talking about entrepreneurial leadership.
The truth is, we are a shining beacon of how to do it right. Our gender make-up is exactly what Smith is looking for. Women make up 58 percent of our workforce. And knowing how my brand Coldwell Banker showcases diversity support with partnerships with the Asian Real Estate Association of America, the National Association of Gay and Lesbian Real Estate Professionals, and the Young Professionals Network, I left our White House Demo day with a sense of extreme pride to know that I am working in an industry that is keeping the American Dream of entrepreneurship alive.
Lindsay Listanski is the senior manager of media engagement for Coldwell Banker Real Estate.
Most of us — really, all of us, but I’m saving room for the diehard skeptics — can agree that environmental changes are having a large-scale impact on our planet. But “environmental issues” isn’t a phrase easily uttered in the real estate community without hue and cry. Many practitioners react negatively to topics of environmental significance, and it’s somewhat understandable. Environmental interests can potentially derail real estate projects and transactions as our society becomes more conscious of how development affects the Earth’s well-being. But even if there’s conflict between the two, they’re also intertwined: The environment can have huge implications for how desirable a property is to buyers. So shouldn’t you, as a person who sells property, care about the environment?
I recently profiled three real estate professionals for the July/August issue of REALTOR® Magazine (hitting your mailbox this Friday) who are contending with environmental problems in their regions. The point of the story isn’t to judge whether practitioners have an obligation to acknowledge and respond to real estate’s impact on the environment. It’s an examination of cases in which some have felt a calling to help clients persevere in the face of environmental challenges, from California’s historic drought to Vermont flooding and the proliferation of fracking in Texas. This reporting got me thinking about an interview I did with David Wluka, who sat on the National Association of REALTORS®’ Land Use, Property Rights & Environment Committee for many years. During NAR’s Legislative Meetings & Trade Expo in Washington, D.C., in May, Wluka and I pondered this question: When should property rights take a backseat to the environment?
In case you think you’re about to be lectured on saving the planet, I should add that Wluka is no environmental fundamentalist. He worked as a land planner helping developers build out prime projects in the Boston area before becoming broker-owner of Wluka Real Estate Corp. in Sharon, Mass., and he’s seen firsthand how environmentalists have held back real estate. He recalled a 600-acre project he worked on in the early 2000s that drew the ire of nearby neighbors. The development process was already well underway when someone found a turtle on the property one day.
“Three years later, we lost 70 percent of this land to this turtle,” Wluka said. The Massachusetts Department of Environmental Protection fought for the land to be preserved for native turtles, and the developers couldn’t prove that the turtles weren’t there. The developer had to scale down the project to single-family homes built on 30 percent of the original parcel. “He’ll do OK, but he wanted to have a long-term business there,” Wluka said. “[Environmentalists will] argue that we’re losing priority habitat land, but it also affects the local economy unnecessarily. Towns can end up shooting themselves in the foot. When it comes to creatures and people, sometimes people need to win.”
But these types of issues shouldn’t prevent practitioners from acknowledging the importance of balance with regard to property rights and the government’s role in fostering a healthy environment. Many inherently get this: Thirty-nine percent of REALTORS® say they believe the federal and state governments’ involvement occurs at an “appropriate” level with at least some environmental regulations, according to a recent REALTOR® Magazine survey of nearly 2,000 members. This finding aligns with Wluka’s assertion that real estate practitioners are environmentalists if only because it is their job to protect the important features that make their communities attractive to buyers, which include the environment. “We’re not botanists, we’re not horticulturists,” he said. “But I think practitioners in general are environmentalists because quality of life needs an environment that is attractive. … When we sell a lifestyle, that means being an environmentalist.”
He’s not suggesting that real estate pros take a political stance on the environment or get involved in movements, but he thinks agents and brokers have a responsibility to make their clients aware of how their properties could affect the environment. That starts with not backing away from hard conversations with clients about how to address their properties’ environmental impact, even if it stands to make the transaction more complicated, he says. “Practitioners should advise clients to get an attorney to help sort out environmental issues, and tell them to get an engineer when dealing with wetlands and floodplains.” (One of the agents I spoke to for the REALTOR® Magazine story advised her clients in flood-prone Vermont to do the same.) “You don’t have to be the environmental expert, but you sure better know to tell the owner that they need an expert. You’re responsible for things like that that are knowable.”
Wluka, in essence, is telling you to look at the environment from a business angle — which is less contradictory than it may sound. The state of the local environment can deeply affect your ability to sell property. So foster open discussions with clients, but try to leave the politics out of it. Remember that being an advocate for your community means championing a healthy environment for all.
So are you an environmentalist?