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Urban Land.- Reinventing Real Estate Page 2 of 5
<br />be they garden apartmenr ts, grocery -anr chI ore d shopping centers, suibdivision�s, or suburbw office parks -they
<br />provided diminishing retul rn�s ins terms of their con�tribu�tion� to the n�atulral environment anod society.,
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<br />COMMODITY
<br />TROMY
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<br />Thee past 20 years were in�struiction�al becauise they made manifest,
<br />more thw at any other time in history, the good, the bad, an the uigly of the real estate profession. Thee
<br />ongoing evolutiw of the in uistry, an�d a sampling of its produicts, is portrayed in the figuire at left.,
<br />Thee fouir categories represented on this con�tin�uiuim define the choices the in uistry has made collectively,
<br />an�d the mileposts of its potential. Ea& category has varying degrees of complexity, con�tribuition to society,
<br />and, many wound arguie, risk and reward.,
<br />Commodity real estate resuilts when the in uistry focusses only on maximizing efficiency - creating, replicating,
<br />an�d rolling oust produict regardless of region or commuin�ity setting. A once-size-fits-all soluition�, it is the widget
<br />end of the business. Thee entire national landscape is pockmarked with its legacy an�d the environmental an�d
<br />humw impacts left in its wake. It couild be said thiat it represents the worst the profession has to offer, an�d
<br />as su& is the basis for so mu& derision toward what the in uistry does.
<br />Trophy real estate is where some of the in uistry 11 s greatest in�n�ovation�-an most photogenic projects-have
<br />evolved. Suit too often it is a "'look at me"' creation- dismissive of uin erlyin�g social an�d environmental needs.
<br />Due to its showmanship rathl er than suibstan�ce, mu& of this class of real estate lies in distress,
<br />overleveraged an�d uin erwater, becauise it was buiilt uip on promotion an�d fleeting statues in lieu of a deeper
<br />senise of purpose.
<br />Investment real estate is the more stable produict class, emerging when real estate is viewed throuighl the
<br />same lens as a stock or bon�d. A tangential interest in societal contributiw may leave been involved in its
<br />creation, bust it is largely a produict of financial engineering, efficiency of design�, strong delivery, asset
<br />management, and branding. It may serve as a good neighbor or corporate citizen for commu�n�ities,
<br />suipportin�g employment or h�ouisin�g choice, bust it is rarely a game changer in terms of the larger buiilt
<br />environment.
<br />Responsible real estate buiilds on the lessons of all previouis categories while uippin�g the ante. It is the best
<br />thiat the in uistry can be, representing the innovatiw and creativity often fouin in trophI y real estate, couipled
<br />with the financial discipline and strong execuition capacity associated with investment real estate. Suit it adds
<br />a their d dimen�sion�-a truce recognition of the real estate in uistry 11 s role an�d responsibility to positively shape
<br />the buiilt environment. It is not a "'look at me"' ouitcome, bust a con�sciouis an�d deliberate response to the need
<br />for economic return an�d creation of social good., It works seamlessly with its existing context an�d respectfuilly
<br />with its commuin�ity partners. It delivers long-term valuie-not juist to its investors, bust to its host commuin�ity as
<br />well.,
<br />Will This Be the Decade of Real Change?
<br />At the turn of the millen�n�iuim, responsible real estate represented the fringe. It was often cloaked in the
<br />simplest of green trappin�gs-resouIrce-efficient t technologies, a location awaiting transit, and d entitlement-
<br />extracted impact fees thiat were spun as social eq�uiity. As the in uistry enters the next 24 months, this couild
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