At the California Business Properties Association (CBPA) Awards Dinner, I spoke with two people who had no idea what CBPA did.
No matter what happens on November 6th, our work in California to save our industry will only intensify. If people fail to become engaged in the regulatory issues and ignore what is happening at every level of government, then the commercial real estate industry will get steamrolled. The end result will be that costs and time delays to do business in California (for all businesses) will continue to increase.
CBPA is the largest and most powerful consortium of commercial real estate professionals on the West Coast. They are the designated legislative advocate for almost every real estate related association in our state including NAIOP, BOMA, ICSC, AIRCRE, IREM, NAREIT and many others.
During our recent CBPA Board meeting, we discussed the stormy future ahead. Split roll taxes will be on the ballot in 2020 and CBPA is already hard at work on the campaign to defeat it. It will take all of our efforts and a great deal of money – in the tens of millions. The idea that we can continue to “play along to get along” must come to an end. Now is the time to stand up and fight. And we need organizations such as CBPA to help us do that because the increased regulations and taxes coming out of Sacramento hurt everyone from big property owners to the smaller developers. Further, all of these problems trickle down to the tenants who occupy our buildings and their employees and communities.
I’ve been passionate about getting involved for a long time now because early in my career I had a project that was killed by new regulations. It was one of my first development projects coming out of the early ‘90s recession. I got hit with a new stormwater runoff regulation that added approximately six dollars a square foot to my pro forma and pretty much undermined any profit. My reaction? “Wow, why didn’t I know about that?” I researched the issue with my civil engineer and discovered that while us developers were trying to “survive until 1995” and working to save our properties by renegotiating with our lenders, the legislators in Sacramento were busy passing new environmental laws and regulations which would adversely affect our business and economic development. We had no idea it was happening because we weren’t paying attention.
That’s why CBPA matters. They pay attention! They review every bill that goes in front of the Assembly and Senate. They read every single one of them and there’s a minimum of 2,500 each year. I’ve even seen up to 3,500 bills in a single year. That’s an incredible amount of new legislation. Add to that the fact that most of the bills are amended numerous times. You multiply that by the ones that make it through, and they have to be read again and again. And then determinations must be made whether or not they’re harmful to the commercial real estate industry and whether we fight them or not. Too often, we ignore this stuff because it’s something that will be implemented over the next five or more years. People don’t make the connection to their day-to-day business if the impact isn’t for another two to five years down the road. But the California legislature makes the connection. They are planning for the next 30 years.
I really hope to see more of our next generation getting involved in the legislative process because what is happening now at the local, state and federal level will impact them most at the peak of their careers.
I have long seen the value of NAIOP and CBPA. It has been an honor to serve on the NAIOP SoCal Board of Directors and spend a year as President of this chapter. I am grateful for each and every member, and the hard work of our board members and committees and the continued support of our corporate sponsors.
It is why this issue matters so much to me. I want our industry to continue to be an economic leader and to be an industry of opportunity for everyone. But to ensure that this industry remains on solid ground, we can’t assume someone else is taking care of the threats. We all have to take action. And we must continue to support the good work of NAIOP and CBPA.
James V. Camp