Phase 2 - Real Estate 101 (How to or one big idea)

Podcast - Emerging Trends in Real Estate 2023

Tyler Stewart
December 20, 2022
Podcast - Emerging Trends in Real Estate 2023


Apple Podcasts


Featured On This Episode

Anita Kramer

Senior Director


Anita Kramer Senior Director, ULI Center for Capital Markets & Real Estate ULI – the Urban Land Institute Washington, DC Anita Kramer is Senior Vice President, ULI Center for Capital Markets and Real Estate. In this position she directs and manages three programs: Emerging Trends Americas, the semi-annual ULI Real Estate Economic Forecast, and the new Deal Profile program. In addition, she provides support to the ULI/McCoy Symposium on Real Estate Finance, the Shaw Forum, and addresses topics at the intersection of capital markets and the priorities of other ULI Centers.

Onay Payne

Managing Director

Lafayette Square

Onay Payne is a Managing Director of Real Estate at Lafayette Square. Prior to joining Lafayette, Onay was an equity owner and Managing Director of Clarion Partners. As a Portfolio Manager, she was responsible for several billion dollars in assets under management and oversaw several separate account and co-mingled investment mandates covering all major property types and markets throughout the United States; she also oversaw Clarion’s Mexico platform, sat on the Career Management Committee and previously served on Clarion’s Investment Committee.  Ms. Payne began working in the real estate and finance industries in 1997.  

Ms. Payne is a magna cum laude graduate of Harvard College, from which she received an A.B. in 1997. She received an M.B.A. from the Harvard Business School in 2003, where she was a Robert Toigo Foundation (“Toigo”) Fellow.  Ms. Payne is fluent in Spanish.  

Andy Cohen


Andy is one of two co-CEOs of Gensler, the world’s top architecture and design firm. He just celebrated his 40th anniversary with Gensler. Since 2005, Andy and Co-CEO Diane Hoskins, have exemplified collaborative leadership, overseeing both the long-term strategy and day-to-day operations of the global practice known for its award-winning design innovation and research. Under their guidance, Gensler has organically grown to become the largest in the field, with over 6,800 people networked across 52 offices, serving clients in more than 120 countries. With expertise in four sectors — community, lifestyle, work, and health — and 29 practice areas, the firm’s diverse work ranges from aviation, urban design, and sports stadiums to office, hospitality, life sciences, entertainment, and more. Award-winning projects such as the Shanghai Tower, the Banc of California Stadium, and airports in major cities across the globe showcase the breadth and scale of Gensler’s industry-leading practice.


Download the Emerging Trends Report

Learn more about ULI

About Emerging Trends in Real Estate

Emerging Trends in Real Estate® is one of the most highly regarded annual industry outlooks for the real estate and land use industry, published jointly by PwC and the Urban Land Institute. By incorporating interviews and survey responses from several hundred industry professionals, the report provides an in-depth outlook by region on real estate investment, development trends, and capital markets. The report is produced in four versions: Americas, Asia Pacific, Europe, and Global. All the Emerging Trends in Real Estate® reports published since 2003 are available on Knowledge Finder.

About ULI & PwC

Emerging Trends in Real Estate® is jointly sponsored by the Urban Land Institute and PwC. Since 2003, the Urban Land Institute and PwC have collaborated to produce one of the most comprehensive real estate and land use industry reports. PwC is a global network of firms in 158 countries with more than 236,000 people who are committed to delivering quality in assurance, advisory, and tax services. Find out more about PwC


[00:00:00] Adam Hooper: Hello and welcome. I'm RealCrowd, c e o Adam Hooper, and this is The Real Estate Investing for Your FuturePodcast. Here we explore the latest in commercial real estate trends, insights,and investment strategies that passive investors can use to build real estateportfolios that last

[00:00:20] Anita Kramer: all opinions expressed by AdamTyler and podcast guests are solely their own

[00:00:24] Onay Payne: opinions and do

[00:00:26] Anita Kramer: not reflect the opinion of realcrowd.

[00:00:28] Onay Payne: This podcast is for informationalpurposes only and should not be relied upon as a basis for investmentdecisions. To gain a better understanding of the

[00:00:36] Anita Kramer: risks associated with commercialreal estate investing, please

[00:00:39] Onay Payne: consult your advisors.

[00:00:41] Adam Hooper: Welcome to the final episode ofthe special series that we recorded live from Eli's fall meeting in Dallas.

In today's conversation, we're discussing the 2023 emergingTrends in Real Estate Report put out by U L I and pwc To help break down thereport, we're joined by Anita Kramer of the Urban Land Institute, Andy Cohen ofGensler and Une Payne of Lafayette Square. Our first interview is with AnitaKramer, senior director at uli, to offer an overview of the emerging trendsreport to download the report and to follow along with the conversations.

Hit that pause button, check the show notes, or Google ULIEmerging Trends.

Alright, welcome back to the episode. Hopefully you've got thatreport in front of you. Here's Anita Kramer to break it down.

All right, well, Anita, thank you so much for taking some timeto share your thoughts about the Oli Emerging Trends reports. Uh, before we getinto that, why don't you tell us a little bit about yourself and what you do atthe Urban Land Institute? . Sure.

[00:01:48] Anita Kramer: Uh, I run a program at ULIcalled Recap, that's the acronym.

It's the Center for Real Estate Economics and Capital Markets.And we, our products are, we have two main products and then some smaller ones.The main product, one of our main, main products is emerging trends, whichmm-hmm. , which we're here to talk about. And the other one is the re uli realEstate Economic Forecast, which, uh, is actually quite separate and done quitedifferently.

Uh, that's a forecast from, we have a, a ongoing pool of e realestate economists from leading real estate organizations that give us theirtwice a year forecasts on metrics that the industry follows, uh, for the nextthree years and around. Um, and obvious, I'm be getting into exactly what theemerging trends is and how different it is from that particular product, but Ijust wanted to mention it.

And then we also look at, um, uh, every year we will look at adifferent, um, new, uh, topic, uh, on the horizon. So this past year we lookedat, um, the, the issue of conversions from older offices, uh, older commercialbuildings to multi-family. Mm-hmm. a large, i, I stumbled there because a largesegment are former office buildings, but it's not all just former officebuildings.

And also looking at the, where the retail opportunities aretoday because there are, um, as much as the landscape is changing, there are,uh, thriving retail opportunities.

[00:03:26] Adam Hooper: Yeah. And thank you for that.And. We'll have links in the show notes to those reports. So, given thisepisode is about the Emerging Trends report, would highly recommend if you're,uh, if you're gonna listen to this throughout, why don't you go ahead anddownload that report so you can review that as we go through.

So, Anita, why don't you tell us high level, what is theEmerging Trends report, how long has it been running for? And, and just some,some overview of, of how you approach it. Sure.

[00:03:49] Anita Kramer: Um, so one of my favoritetopics, it, the, the report itself has, this is, its 44th year, so it's beengoing on for quite a while. Uli has been involved, I think it's is their 21styear.

So we've been in a almost half of its life. Mm-hmm. , uh, it isa rep and we, and our, we, it is done in partnership with pwc. Mm-hmm. , Ialways wanna make sure that we, I mentioned that we work very closely together.It's a true collaboration. Uh, it is a report that looks at the overarchingtrends that will, um, impact real estate over time and broadly.

And even though it might, um, impact different ar differentmarkets somewhat different and in different timeframes, but it is thoseoverarching trends. Uh, the other distinguishing feature is that it is asentiment report, uh, in that we, we are gleaning the knowledge and theinsights from. , almost 2000 real estate, um, senior real estate professionals.

Mm-hmm. across the country. Mm-hmm. . And we do that in threeways. One way is, uh, in a very key way or one-on-one interviews. And we do, wedo, uh, and when I say we, it is, uh, a team effort with pwc. Uh, we do, uh, wehad, we did about 300 of those interviews. They are usually somewhere from 30minutes to an hour.

And, uh, we have a series of questions that we are really.asking them to think about all, every aspect of the industry. Uh, so we, um, sothat's one way that we're, we're really listening to what they're, what they'resaying and what they're thinking. Uh, it is a real listening exercise. Peopleare not sitting there saying, well, this is exactly the next emerging trend.

What we just have to hear how they're thinking to really tetease out kind of the common threads that we're hearing throughout theseinterviews. Uh, the, uh, second one is a very, uh, again, comprehensive andextensive survey, uh, online survey, of course. Um, and. is, was answered by Ithink almost 1500 people this year.

That just expands the scope of the same, uh, profile of people,uh, but expands. It was, it was 1,450 people. Mm-hmm. , um, who responded. AndI've been told it's grueling. But despite that people, people do answer it isthe longest survey in the industry as people try to reduce the number of thetime people need to take to, um, answer surveys.

We have not budged. In fact, I think we've expanded it. We justtry to make it user friendly cuz it's so, so informative to us. Um, and thethird, uh, is. Something that we have, we developed just maybe five or sixyears ago, which is to get more insight into the individual, um, markets acrossthe country.

Mm-hmm. . So our interviews tend to be with people who areoperating kind of on a national level, uh, not necessarily always active inmany markets, but really watching for those opportunities. Uh, so to get a verydeeper dive into as many, uh, individual local markets. We have worked withthe, the ULI district councils, uh, those are like our local, like ULI at thelocal level, like local chapters.

And they work with us to bring together a small group of theirsenior people to answer a set of questions and discuss a set of questions abouttheir market. And then we have an intake form where they each fill out theirthought. And that has been just invaluable as well, expanding, um, what weunderstand is happening across the country.

I just wanted to mention kind of the profile of the peoplethat, that we, um, do contacts. So, uh, um, I'm looking at the distribution ofthe, um, the profile of the people that answered the survey, and that is prettyreflective of the, both the one-on-one interviews and the, um, focus groups. Sothe highest group, the largest group are private property owners or commercialmulti-family real estate developers.

And then real estate advisory service firm or asset managers isthe next largest private equity real estate investors, bank or other lenders.So, um, and then there's, you know, home builders, investment managers,advisors. Mm-hmm. , uh, you know, those are the smaller, but really, um, thosethat are actively involved in.

And development and investment advising and lending of sayingfinance.

[00:09:02] Adam Hooper: Yeah. And I think what's, what'skey and, and what we've always enjoyed about the report is it's not, it's notyou, uh, just making these things up and saying, yeah, this is what we think isimportant. Right. It's, it's actually going out, collecting the data frompractitioners, listening to them, and then, and then sorting through thoseresponses and kind of teasing out what is important to the people that areactually in the field doing the work.

Right. I think that's, that's what's so unique and differentabout this report is the, the tangibility of those, of those themes and it's,you know, immediate applicability to things that are, are actually mattering to, to the people that are doing the work.

[00:09:35] Anita Kramer: Right? Yeah. Yes. And thank youfor, for emphasizing that.

That is I think, what makes it stand out. Yeah. And, um, whatmakes it really enjoyable to, to work on because, um, we are really trying tounderstand. what people, what people are saying and yeah, how they're thinking.And again, you know, it's not that people are coming to us and saying, this iswhat I think is the emerging trend.

Sometimes people do, but generally that's kind of not theirday-to-day how they think they're, they're they're, but they mentioningsomething that they've noticed that is different. That's, so this is how westart developing, um, the direction that the report is going in.

[00:10:17] Adam Hooper: And now over the next fewepisodes, we'll be talking to some folks that were, were on stage at the fallmeeting to, to tell us about the current report, the 2023 report.

Um, how have you seen some of these trends change, or, or we'vebeen through a pretty tumultuous few years here. Right. Um, are there, arethere some longer terms? Since the port's been around 45 years, Eli's beeninvolved for 20 plus. Uh, are there some consistent themes throughout, or isit, is it pretty, uh, you know, varied from year to year?

How, how do you see that?

[00:10:52] Anita Kramer: Okay, so again, a good question.Um, I would say a couple of things. Uh, there have been some notable,noticeable changes, uh mm-hmm. in the markets, um, over time. So 10, 10 yearsago it was, you know, the sexy six, right? So it's the, the, this, the oldtraditional markets that got all the attention.

And really that has been a major change, um, as we watched thesmaller markets, um, kind of rise into the top 20, in the top 10. And, um, ,that's when we coined the term 18 hour City. Mm-hmm. , uh, has to be abouteight years ago now. And then, um, that, that, that sea, that sea change hasjust, um, was, was really clear.

And that has then developed legs in different directions. Sothat was kind of a, a big shift. And then as we watch, you know, there's kindof different, um, differences within what we once lumped together as 18 HourCity. That was just our first going in. So, um, now I think you've, you may noticethat we have created categories for every market.

Instead of, oh, it's the top. It's the top markets and thenthere's everybody else, or there's top markets in 18 hour cities and everybodyelse. What we found and understood is that while not every market is a sizethat can handle institutional investment, there actually is quite a bit ofinstitutional investment and even, you know, in places that once there weren't,as people look for opportunity, but that there's other kinds of opportunity forother kinds of, um, investors and developers in almost every market, and togive them their due, we created and getting away from, you know what, youalmost don't hear anymore primary.

secondary, tertiary, and getting away from, oh, if you're notprimary, you're, you're, you're 18 hour city, which we, we realized after a fewyears that wasn't even the case. And, and so we have worked the last threeyears to kind of evolve these different categories and try to provide theindustry just kind of a different perspective on how to think about thedifferent markets.

So that's been kind of, um, something that's be, been evolvingand has, mm-hmm. , um, has kind of been there every year for, for some timenow. The other, um, thing I wanted to point it out is the, so there's some, sowe try to be true to emerging trends when I mm-hmm. started, start off bysaying, these are kind of overarching trends that will play out over time.

So that's kind of emerging, but there's some things that, thatI probably could fall into the category of. We have, we can't not spotlight. Sothe, the affordability issue in, in housing mm-hmm. , uh, it's, it's a crimethat it's still there, but it mm-hmm. , we can't, we can't just say wementioned it one year and therefore we're not gonna mention again, it needs tobe front and center.

Right. It's a,

[00:14:10] Adam Hooper: it's a persistent trend, not

[00:14:11] Anita Kramer: so much an emerging trend. Yeah.I mean, I hope this doesn't become a secular trend. Yeah. Um, and we're notgonna go there on that one. So, um, that one and, and it does get worse. So we,we, we brought that up. Maybe I missed everything is eight years ago, I don'tknow, six years ago, seven years ago.

And we, we just find a different, um, way to emphasize it and apiece of information to educate people mm-hmm. and keep that awareness andimportance. Um, certainly infrastructure has been on our radar for radar for.the number of years that has come up. Um, mostly the lack of, the lack of fundsfor that. And then, um, what cities and states have been trying to do on theirown.

And now of course there's good news mm-hmm. . And so we've alsospotlighted, um, the equity aspect of some of those funds. Yeah. So those,that, those are kind of the, and then, then there's the things that are just,um, new every year and, and we don't revisit like PropTech, although, which webrought, which we had last year, but um, this year we, we, we weave it intoother trends.

Mm-hmm. , so we weren't talking about affordability is, youknow, where are we on the technology that could possibly help that. So yeah, Iwould say that's kind of an overview of how trends. Evolve and stay with usand, and pass on.

[00:15:46] Adam Hooper: Yeah. And I, I'll say before wejump into the, maybe some of your key thoughts quickly on the 2023 report, I, Iwill say, I'm not sure who within Oli is responsible for it, but I do have togive a quick shout out for the, uh, the cheekiness of naming the trends.

That's always one of my favorite parts of the end report is,oh,

[00:16:02] Anita Kramer: we have a good time on that one.That, that is a group effort . That, that is we, that is our, that is our fun.That is where we have our fun and have a little fun. Right. I did wanna alsomention if I, if you don't mind going back to kind of how the report, um, is,comes together and who worked on the report.

Mm-hmm. . So, so I, I talked about kind of where we get kind ofour fodder for, for identifying the trends, but we also include, um, In thereport, there's a, there's a particular chapter called the, um, uh, property isthat, I forget myself, uh, property type outlook. And we ha in there, um, wehave, for the main property types, we have individual experts who are writingabout how they view, where the, where that sector is going.

Mm-hmm. and the issues in that sector. Uh, so, and that adds aswell to what we can pull from in terms of is, are there some overarching trendsthat are merging here, but in and of themselves, they are really valuablepieces of writing and information. And also in that chapter we have, um, a lotwe incorporate.

The, the, the sub-sectors or the niche sectors mm-hmm. , um, byhaving, um, experts in those. So we, we do that by sidebars. It's just theconvention of, of kind of how we present, but those are also written by peoplethat are in the industry and are experts on those as well. Great. So I justwanted to call that out as a valuable piece that, for actually reading thereport, but also kind of another way to inform us as we develop the

[00:17:55] Adam Hooper: trends.

Yeah. And again, links are in the show notes. Uh, highly,highly recommend if you haven't downloaded and reviewed the report, do so. It'salways just jam packed full of great information. So highly, highly recommendthat. Um, and Anita, as we wrap it up here today, why, why don't you tell us alittle bit about, you know, what are the, a few of the key trends that you'repaying attention to or seem most interesting to you, given where you're at, ofkind of, you know, overseeing all of them?


[00:18:20] Anita Kramer: Right. I was say it's kind oflike asking me. , like, which, which child do I love? The death? Which of mychildren do I

[00:18:26] Adam Hooper: love? Well, you've got, you got,you know, 10, 10, 12 to choose from here with . Some trends and some, some

[00:18:31] Anita Kramer: add-on. So, okay, so first of, Iwanna mention the, the, the theme. I think sometimes kind of, if you look atall them together, the, the theme, um, is really this year's like taking thelong view, so mm-hmm.

um, which kind of fits with what the report is always tries todo, which is looking at the emerging trends of plant over time. Um, this time,this year, obviously we're in a high degree of uncertainty. Um, I know thatword is used quite a bit in many different times, and I think it definitelyapplies to what, to where we are now.

Mm-hmm. . So I, um, I think this sentiment really is, yes, uh,there's a lot changing and yes, right, the kind of, the very near term. Um,there, we don't know exactly how, how all this will, how the rising interestrates and how inflation will really play out, but that there is a belief thatthe industry itself is, is well positioned to, um, find its strength again.

Um, not this weak, find it, find its strength and keep and,and, uh, keep going. Mm-hmm. You know? Mm-hmm. , if even if there's a po short,short term pause, that that's, um, not a major impact in the long run. So interms of, uh, trends, I think the, um, so first I'll just mention that the, uh,the housing, the, that's the one, uh, too much for too many, so mm-hmm.

it's just as I unfortunately getting to be our, our, um, Or conone of our constant themes. So I just wanna point that out yet again, and weemphasize, um, that really the, there is no one silver bullet that'sunderstood, but there is work that can be done, which is allowing for moredensity in more places is one, reducing the cost of, of development in terms ofregu regulatory fees, um, is, is another.

Uh, so, and, and making the best of, uh, and still holding outhope that there's, um, technology that can play a bigger role. And also I, Ithink getting back to the first two kind of expediting approvals because thatthe nimbyism really has been able to slow things down. Um, I'd say another oneis, um, another over kind of the, the themes are kind of the, the trends arekind of very closely interwoven.

And I'm gonna use office as an example. So, um, typically in adownturn in there is in the office sector, there is, um, a flight to, to lessexpensive, uh, office space. But in fact, what's happening now is, is theopposite, right? So it's more a structural change that we're seeing in that.And, um, you know, there is a flight to, to quality and this is, um, thisbrings out, okay, what then happens to those other buildings?

So this is a little bit starting to be like what we've talkedabout, what people have understood about retail, which is for, for. a decade orso where we're over retailed. And so what do you do with the sites or thebuildings and, and retail cases? It's typically the site that is more the mostvaluable, not the particular buildings.

Mm-hmm. , um, although there can be certainly reuse of, of, ofmany buildings. So this is something that's, that is going in one direction,but o o opening up opportunities, uh, for in another direction. And the, theflight to quality and the flight to quality. You also see in retail, uh, whereit's, there are so many, um, it's the, the grocery anchored and the, the, the,the neighborhood and the power center.

All these things, um, that are providing people. What theyneed. Mm-hmm. . So that is also connected to the other flip side of that is wesaw a spike in the online shopping in the pandemic, and it's, it's come down,um, you can't, you know, you have to eat in restaurant. You know, when you goout to eat, you go out to eat, right.

Uh, so people are sick of staying in to eat. Um, but also thereis just a need to touch and feel what you might w need at any particular time.So we see a, we see, uh, a little, um, dip, but not back to pre pandemiclevels, uh mm-hmm. of the online shopping. That is also the other flip side ofthat is the, you know, what's gonna happen to an industrial, but sticking withretail, um, we see that, that flight to quality too.

So for those really good, well located, well tenanted,Opportunities. Uh, I mean, centers, those are doing really well. And I thinkthe complaint is aren't enough good locations for people that wanna get intoretail. But then there is all the other older, not well configured, not welllocated mm-hmm. , um, not offering what people need.

And that's really, so we really see the office sector startingto look the same way. So, um, flight to quality where, where it's good, it'sgood, and where it's not, it's, it's gonna be opportunities to be for otheruses. Um, there's not gonna be, uh, a way they're not going, not every buildingcan be converted.

Not every office building can be. . Uh, certainly if it's inthe suburbs and the zoning has, and it wasn't built to maximize the zoning,then the, there's inefficiency to use that building. Those will be teardowns.Um, but, and you know, there's a lot of, I think there's a whole kind of newniche, uh, industry that is, um, starting to, that is developing, um, theskills to, to do these conversions.

Mm-hmm. , that's another opportunity in itself, uh, as well asthe actual opportunity to, to bring new life to a building. So I I, I'vetouched on many, many trends there, but they all kind of, they, they doconnect.

[00:25:19] Adam Hooper: Yeah. I think that's, again,what's so great about the report is we could spend days talking about this, so, we've got it.

Yeah. But I think that's maybe a good, a good spot to kind ofwrap up the preview here of, uh, of the reports. Again, we'll have a fewconversations to follow. This one. Um, about the presentation at, at fallmeeting here. Um, and again, highly, highly recommend everybody that'slistening. Go download the report if you haven't, so that you could followalong with these conversations.

So, uh, Anita, why don't you let the listeners know again, alittle bit more how they can learn more about the report and, and generally thework that you're doing at uli.

[00:25:50] Anita Kramer: Sure. Um, always go to emerging trends report right now is on the front page, , so that's quiteeasy to, to find. Otherwise you can, uh, do a, do a search in our find and findit, um, very easily.

It is one of our, our flagship reports. It's right there, frontand center. And, uh, then also under, um, in the menu that you should be ableto find the Center for Real Estate Economics and Capital Markets for our other.

[00:26:23] Adam Hooper: Thank you, Anita. Next up we'llhear from Andy Cohen, co. C o at Gensler. Gensler is a global design andarchitecture firm, founded in San Francisco in 1965.

In 2021, Gensler generated over 1.25 billion in revenue, themost of any architecture firm in the us. In this interview, Andy shareshighlights from the emerging trends in real estate panel at the fall meeting.We hope you enjoy the conversation with Andy Cohen. All right, Andy, uh, we'recoming fresh off of the emerging trends panel that you were, uh, on today.

So again, appreciate you coming and, and sharing your thoughtswith

[00:26:59] Andy Cohen: us. Thanks so much for having me.Really exciting, uh, panel.

[00:27:02] Adam Hooper: Absolutely. And again, that, thattheme throughout here, it's just been, it's been fantastic to be here at the,at the fall meeting and the engagement with the audience and, and just the, theexcitement in the industry heading into an uncertain time, I think is veryrefreshing.

So, um, before we jump into the panel, why don't you tell usabout your background in real estate? Sure. And Gensar.

[00:27:20] Andy Cohen: Well, I've been at Gensler for 42years, so I've been a lifer at Gensler. Yeah. Uh, I've also been, uh, COCE O ofGensler with my partner Diane Hoskins, for 18 years. Mm-hmm. . So it's been agreat run.

Our firm has grown from, uh, you know, a small pop-up firm inSan Francisco to now we're 7,000 people, uh, in 50 offices. And last year weworked in over a hundred countries. Wow. All about, you know, design and allabout the optimism of design can do to change the world and make a differencein the world.


[00:27:53] Adam Hooper: And so that was, uh, your, uh,Byron asked of one of the first questions on the panel. What is your, your wordfor 2023? Yours was transformation. Right. Uh, tell us a little bit about whatthat means to you. Yeah,

[00:28:04] Andy Cohen: I, I said transformation cuz Ireally believe that the world is in transformation. Look, the covid was a wakeup call for climate change.

Mm-hmm. and the health of the planet. Uh, and as an industry,all of us, uh, 40% of all co2. Is created by buildings. Mm-hmm. more thanautomobiles, more than industry. And so we have this great responsibility intransformative times, not only based on where the economics are going mm-hmm. ,but also with what's happening in the world and our responsibility towardssustainable design and net zero design.

So these are transformative times. Uh, every one of theindustries we're involved with, from office to hotels to retail, every one ofthose businesses are changing, and we are at the forefront of the strategiesand the design to make that difference in those industries. And, and one

[00:28:53] Adam Hooper: of the things you talked about onthe panel, and is obviously still a big question on everybody's mind is, is thedynamic of the office environment.

Right. Um, we've al, you know, we've been exploring how, howdoes it, how does this change the nature of how we use the space? Um, that wasa big focus of what you were talking about and just the, the layouts and, andmore of a. Um, kind of almost creating a, that work from home environmentright. In the office.

So maybe tell us a little bit about what you're seeing in termsof how we use that space.

[00:29:19] Andy Cohen: I mean, what, what we've beenseeing is we need to make the office a destination. Mm-hmm. not an obligation.A place where people want to go, not that they have to go. Yeah. We're talkingabout the offices. An experience multiplier, all about collaboration, you know,vis creating visceral experiences.

Mm-hmm. social interaction, uh, collaboration from our researchfell off 50% during Covid. Yeah. Collab 50%. Yeah. Imagine that. So the idea ofbringing people back to the office is a way to collaborate, uh, to way toinnovate right, to socialize is really important. Along with that, Mentoring andcoaching, which is so important, especially to the next generation leaders.

You know, the Gen Xers. Mm-hmm. , uh, you know, the millennialsare so important and what that too fell off by almost 60%. So we really believethe, the future of the office is about bringing people together. It's aboutcreating, creating great experiences. Mm-hmm. , we're seeing this sense ofchoice, like you mentioned mm-hmm.

that when you were home, you worked at your dining room table,your living, you know, in your living room. And we're taking that idea of senseof choice Yeah. And bringing that to the office. So when you come back to theoffice, Based on what you're doing in that day, the tasks that you're doing,you can work in different types of environments and what we're seeing is takingout the rows and rows of desks in this open plan environment.

Mm-hmm. this very dense environment. And we're creating moreliving room settings, more cafes, more inside out, outside spaces, you know,more green spaces. Mm-hmm. with the ability for people to choose where theywant to work for that day. That's most conducive for interaction and uh,innovation.

[00:30:51] Adam Hooper: Yeah. And you mentioned this,this reversing that trend of densification, I think you said we're about 250square foot per person.

10, 12 years ago. Pre covid. We're under a hundred square footper person. Right. Obviously that's reversing now. Do you have any thoughts orwhat are you seeing now in current designs of where that's going on a, youknow, I guess square foot per person, or is that even a relative metricanymore?

[00:31:12] Andy Cohen: Yeah, our client, well look, wework with most of the major tenants.

And clients and global accounts around the world. Mm-hmm. . Andthey're all coming to us saying, what is the future of workplace? Right. Andworkplace has radically changed. Like you said, 10 years ago, it was 250 squarefeet per person before Covid is now the 75 square feet per person. Yeah. Andthese big open plans, the ubiquitous open plans with Rosen R Death.

Yeah. And what we're seeing now is we need more we space.Right. Instead of I, space, space again around collaboration and pulling peopletogether in a really conducive way. So the, the industry's radically changing.We're seeing this transformation of our clients' businesses. Mm-hmm. , it's allreally about their culture.

Mm-hmm. , which I didn't get a chance to talk about on stage.It's this idea that our clients have come to us. How can we really reinstateour culture Id, our identity as an organization? And that comes through thedesign, the space, you know, the brand of their space and their people firstcreating, it's no longer about the company space, it's about people, space andpeople first centric spaces.

[00:32:15] Adam Hooper: And so when you look across thespectrum of either office owners or tenants or occupiers, it's, it's adifferent level of, I guess, attainability to be able to create these gorgeous,welcoming, inviting, collaborative, a plus spaces for buildings or owners ortenants that maybe don't have the luxury of doing that.

They don't have the budget to do so, or have the, you know, theopportunity to work with a firm like Gensler, how can they incorporate some ofthese things in their practice so that it's, it it starts to create some ofthose environments.

[00:32:45] Andy Cohen: Yeah, I mean, I think for everyorganization you could, there's little things you can do through branding andthrough design.

Mm-hmm. . that'll increase that awareness of, you know, oftheir, their, of their company. But I also think there's a tremendous, rightnow, tremendous flight to quality of the types of buildings that people arelooking at. Mm-hmm. buildings that are, have tremendous amenities. So whetheryou're a small tenant or a large tenant, being in walkable districts, walkablecities where mm-hmm.

there's amenities that are close buyer within the building thatintroduce, uh, you know, technology into the buildings that make it moreseamless environment. Uh, so I, I really think for any tenant right now, youhave to make the workplace a destination. Yeah. Like I said, you have to makeit, uh, worthwhile to go in, especially if people are commuting from longdistances.

What we're finding from our research right now is that there's,we're seeing. Probably by the time for all the fallout happens during, uh, inour return back to office, we're seeing that probably 10 to 20% of people willstill be working from home. Mm-hmm. . So hybrid is here to stay. Yeah. So allcompanies big and small need to look at how they're gonna integrate a hybridenvironment, and that means in the offices you still have to have the abilityto have screens and conference rooms, have smaller conference rooms for peopleto meet in mm-hmm.

so that you can include the people that are working from homealso. It's not going away. Yeah.

[00:34:06] Adam Hooper: And now we're, we're at a time inour industry where data is becoming much more central to a lot of thesedecisions and smart buildings and sensors. Right. Was one of the things thatyou mentioned. What do you see as the future of smart buildings?

Is it, is it, again, empowering just the ease of use of anoffice space? Are there insights that operators can learn about how the spaceis utilized or, you know, managers of companies that are occupying the space?What insights can they learn from some of these, these smart buildinginitiatives?

[00:34:33] Andy Cohen: It's all about the userexperience.

Mm-hmm. , you know, but when we were locked up on these screensand Zoom calls, everyone's looking for visceral experience and that userexperience and technology can help facilitate that. You know, we're seeing inbuildings the idea of using your cell phone as a concierge service mm-hmm. thatyou can order food from that when you check in the building, it knows who youare, that it calls up your elevator to the right suite, that it knows whichconference room you're going to.

Mm-hmm. . So the integration of technology, whether it's, uh,you know, facial recognition that knows exactly who you are and you, when youenter a building to, to your point, to utilization of space, we're seeingsensor technology is helping us design the spaces of the future. Mm-hmm. , itallows us to study circulation patterns.

It allows us to, uh, study utilization patterns that allow usdesign spaces that are more about the way people want them to be thanprescribed, uh, designs.

[00:35:27] Adam Hooper: And now one of the, the emergingtrends is this concept of, of re utilization, right. Of, of. Not necessarilydemolition of these existing facilities, but more of adaptive reuse.

So we've seen, again, at different periods throughout historycome, you know, in different waves. Um, how do you see adaptive reuse goingforward? When we're, as we discussed today, we're in an environment where we'reprobably over retailed depending on how the nature of how we use the officespace. I think still to be determined in terms of what the overall footprintrequirements are gonna be, if there's gonna be a reduction in footprintrequired.

But then at the same time, you've got this competing factor ofyou need more square foot per person. So how do you see some of these adaptivereuse plays? Especially when you're looking at the, the base property beingeither in the retailer office sector,

[00:36:12] Andy Cohen: I think going into the next yearor two, I think adaptive use is gonna be everything.

Mm-hmm. , it's, uh, all about taking existing space and reallymaking it, uh, you know, much better design. Mm-hmm. . Um, what we're seeingis, uh, lots of, uh, Reconstituted spaces. Like for example, we're doing a lotof buildings right now where we're taking antiquated office buildings andconverting them to residential.

We have a residential calculator actually that takes existingbuilding footprints and quickly figures out whether residential work in it.We're taking old, uh, malls and converting them to office space or retailspace. Uh, mostly office space. So we're seeing adaptive reuses the future alsofrom a sustainability standpoint and from a cost standpoint, it's gettingreally expensive to build new buildings right now.

The idea that you can take an existing building and renovate itfor much less cost, right. But also from a sustainability standpoint mm-hmm.much less embodied carbon. And that today from a sustainability is reallyimportant and that is the energy used. put the materials together that build abuilding.

And so we're seeing that exi, adaptive reuse is one of theanswers as ex a lot of existing inventory. Mm-hmm. , obviously there's a lot ofB and C space that needs to be looked at differently. Mm-hmm. from adaptivereuse standpoint.

[00:37:30] Adam Hooper: And then we've talked a littlebit about the embodied carbon versus getting a net zero for operating carbon.

Mm-hmm. , um, you mentioned mass timber. We're seeing moreconstruction there. Maybe tell us a little bit about Sure. What you're seeingin that space Sure. And, and how that plays into the sustainability goingforward.

[00:37:45] Andy Cohen: What, what we've been studyingembodied carbon a lot and embodied carbon is so important that, and reallypeople haven't focused on it that much.

And that is the energy it takes to make the materials andtransport the materials. So, for example, the biggest uses of embodied carbonare steel and concrete. Mm-hmm. , uh, and we're working with a lot of companiesand subcontracted right now. On the innovations within those industries.Mm-hmm. , cuz we've got to change the embodied carbon in those two materials orother materials like carpeting as an example, or studs and walls.

So we're seeing this, you know, transformation in, in thebusiness going on right now around embodied carbon and how, uh, the future ofsustainability will be about the materials that are used in a really smart way.And also what's really important also is the, uh, idea that we can buildbuildings out of timber.

Mm-hmm. at re, re reforested, recar, decarbonization of, uh, wood.Mm-hmm. so that, uh, wood is an efficient material, uh, and it uses way lessenergy. Than steel. So we're seeing, literally, we're designing hundreds ofbuildings out of timber right now that also aesthetically create a much warmer,uh, and intimate feeling with inside the buildings.

[00:38:58] Adam Hooper: Yeah, it's interesting. One ofthe conversations we had, uh, yesterday was around some of the zoningchallenges of, of creating these communities and almost going back to a pre,you know, pre-modern zoning mm-hmm. concept where we had more vibrantcommunities, you had more inclusive communities. Now we're talking about goingback to maybe pre-modern technology building construction methods.

Right. We're, we're going back to what we've already known and,and kind of reverting to some of those tried and true methods. Right. Are youseeing more of

[00:39:24] Andy Cohen: that? Yeah. I mean, something thatwe've been researching over Covid is the idea of a 20 minute city, right? Theidea that when during covid, people wanted every one of their services andamenities within a walkable distance mm-hmm.

of their neighborhood or district to city. And that that, uh,that concept of a walkable city is so. So important.

[00:39:45] Adam Hooper: Yeah. That's great. And so nowwhen you, when you think about some of the changes that you've seen in yourpractice leading into covid and then now in a post covid environment mm-hmm. ,I'm always curious which of those were accelerants of trends that were alreadyunderway versus truly fundamentally different ways that we're gonna use spaces.

So I'm just curious, what have you seen in your practice thatis a, you believe will be a long-term, just fundamental shift in how you guyslook at the, at the space? I think it's,

[00:40:10] Andy Cohen: you know, COVID is funda. changethe way we think about space and design and that design is, needs to be anexperience multiplier.

Mm-hmm. . And I think that, uh, you know, the future, whetherit's retail or office or hospitality, uh, uh, you know, we're in, we have asports practice. It's all about that experience. Mm-hmm. , whether we're in ahotel, it's the guest experience and focusing on, you know, the design forthat. Or in a sports facility, it's about the, you know, the fan experience on,you know, on and on an office.

It's a workplace experience. Uh, there's fundamental changesthat are going on all around, creating better experiences, better design, moreuser focused design, more about creating, um, uh, interactive experiences.Mm-hmm. , like I said, collaboration and really social interaction. People areyearning for it, and that is going to stay forever.

The idea of interaction, social interaction, people workingtogether, you know, collaborating together, mentoring and coaching together.Mm-hmm. .

[00:41:09] Adam Hooper: Perfect. So I think that's a, uh,that's a great spot to wrap it up. So Andy, appreciate you taking some timewith us. Thank you, Andy. Last up and rounding out today's episode is UnePayne, managing director at Lafayette Square.

Lafayette Square was founded in 2020 with the mission of beingthe leading provider of impact driven capital. In this conversation with Onna,she shares insights from her career and her thoughts as a panelist on theemerging trends and real estate presentation at the fall meeting. We hope youenjoy the conversation with Onna Payne.

Well, Onna, thank you so much for joining us, coming fresh offof the Emerging Trends panel. Um, it's

[00:41:47] Onay Payne: great to be here with you, Adam.Thank you for the

[00:41:49] Adam Hooper: invitation. Fascinatingconversation. Uh, before we dig into what you all just talked about, why don'tyou tell us a little bit about the work that you do now at Lafayette

[00:41:57] Onay Payne: Square?

Sure. Lafayette Square is a mission-driven investment platform.I joined Lafayette Square earlier this year to build out our real estateplatform. Uh, we have a middle market. Credit team. We also have a renewablesteam and everything that we do within the third, uh, the three verticals thatexist today really focus on deploying financial capital and services in waysthat support the more equitable outcomes for low and moderate incomeindividuals.

So really it's a place plus people strategy, low and moderateincome, census tracks low and moderate income, uh, individuals, and really moreequitable outcomes and the socioeconomic mobility, which is required in orderto achieve that. Yeah.

[00:42:41] Adam Hooper: And you, you definitely mentionedthe socioeconomic mobility in your presentation today.

Um, you also, coming from Claire and partners mentioned youjoined Lafayette to be part of the change, right? A little moreentrepreneurial. That seems to be a pretty common thing. Yeah. Theme. We're ina period of great change right now. So I'm, I'm just curious, can you tell us alittle bit more about that transition, how that's been from super institutionalwith Clarion to now more entrepreneurial with Lafayette?


[00:43:05] Onay Payne: Listen, Adam, I had a great careerat, uh, at Clarion and um, and still had runway. There. There were things aboutthat experience that were, um, we choose to be happy. We choose to find meaningin what we do every day. Mm-hmm. , but I was increasingly called, um, to, um,to be. Transformational change. Mm-hmm. as opposed to more incremental change.

And so, um, at some point, and this all of us can probablyrelate, uh, to this, the cost of staying mm-hmm. becomes greater than the costof leaving. So while there is some risk to being part of, uh, anentrepreneurial firm, uh, I think for me being with the right team members, um,with the right perspective and diversity of perspective, cuz we have a bunch offolks from, for example, the social sector that ran CDFIs.

Mm-hmm. , we have folks that worked in government as well aspeople from institutional back, more traditional backgrounds like my mm-hmm. ,I felt it was little Right platform, right team to join, to be part of, um,hopefully transformational change. That's the goal at least.

[00:44:08] Adam Hooper: Good. And it's, again, it's, Ithink we're in a very, it's an exciting time in our industry.

Right. I think and, and to see what we've seen here at the fallmeeting. There's so much engagement and change right now. Mm-hmm. . It's just,it's, it's awesome to see. And I think, again, great to, to be a part of that.So when we dig in the panel, I think one of the first questions that Byronasked, which I thought was great, is what is your, what is your word for 2023?

Mm-hmm. , I think you said realignment. Mm-hmm. . Uh, tell us alittle bit about what that means.

[00:44:33] Onay Payne: Sure. Uh, so as we move, into thisspace of continued uncertainty. Mm-hmm. . Um, we need to refocus individuallyas a society, as individual contributors, but really thinking about this from asocietal perspective, um, refocus on what is most important and align ourpriorities.

Mm-hmm. the time that we spend, the energy that we give, um, towhat is most important. And so for me, uh, the transition to Lafayette Squarefrom Clarion was part of that realignment. Mm-hmm. . I'm continuing to seethat, um, certainly with many of my counterparts, uh, with, uh, where ourfirms, uh, deploy their capital.

Mm-hmm. , um, how they think about, um, moving towards, uh,within strategic initiatives, moving towards affecting, uh, realities that theywanna affect. So, um, really realigning time, realigning energy. Mm-hmm. , um,and effort with what is most important to us. So, uh, thinking about thepriorities and making sure that we're doing the things that we need to do, uh,to, um, to

[00:45:44] Adam Hooper: affect them.

Perfect. And now maybe talk us through your involvement withthe, the report research, um, and what were some of your more interestingtrends, or what are you paying most close attention to in, in the emergingtrends

[00:45:55] Onay Payne: this year? Sure, sure. So, um, oneexcited to be part of, uh, the research and, um, I wrote a little sidebarfocused really on the emergence of impact investing.

Mm-hmm. , so that speaks to my experience today. But really,um, I, I would suggest, um, or it's clear to me that again, What I'm doingtoday can be really consistent with the, is really consistent with what we sawon the report. Mm-hmm. . So for example, um, the, uh, decreased levels ofaffordability mm-hmm. from a housing perspective, um, even if we're going in,especially as we're going into a recession, potentially, Mary suggested thatwas the case.

It's coming. . Yep. Um, uh, that becomes an increasingly moreimportant mm-hmm. , uh, factor for us to think about, uh, as individuals, as asociety. Um, so, um, you know, thinking about, uh, affordability is oneexample. Um, Andy on the panel spoke to, um, uh, the use of office and what that means in terms of how we collaborate mm-hmm.

how we pull people, um, into, uh, spaces for collaboration. Andthat can be in the physical office. But really I think what I, what spoke to meabout. Uh, what he was saying is it's really, it can't be a push, right?Mm-hmm. , uh, and or at least it, it had not been a push for the past couple ofyears where talent was so, um, scarce because unemployment rates were so low.

We're potentially going into a space where unemployment ratesare potentially, uh, increasing, but I think the trend is the same. Mm-hmm. ,we have to figure out how to compel versus push. And so how do we createculture and utilize the built environment to do that? Certainly with an officecont construct, but really thinking about how we do utilize the builtenvironment to achieve all the priorities that are, um, that we have, uh,listed for ourselves.

[00:47:56] Adam Hooper: Um, you mentioned that LafayetteSquare is a remote first firm, um, and you made a comment about how can you usespace to inspire inclusion. Mm-hmm. , how do you do that and what does that

[00:48:04] Onay Payne: mean? Yeah, so, uh, obviously I,we defer to Andy with respect to specifics of design, but I can share mm-hmm. .What it is about my experience, um, and perspective that, that I would wannasee incorporated.

The reality for me was that it took a lot of effort to go intothe office every day. I can be highly productive and am highly productive inthe office, but I can also be highly productive at home. I can be highlyproductive in hotel rooms as I have been for the past several weeks of. Season.Mm-hmm. . But there's little appeal to going into an office building every dayto sit in a cubicle or, uh, in my case in office, be re being real.

It's been a long time since I've had that cubicle time, but,um, . But you know, really, you know, why do I have to go into the office to dowork that I could potentially be doing much more efficiently at home withouthaving wasted the 30 minutes? Mm-hmm. of doing my hair and makeup, cuz y'allknow you're gonna talk about me.

My hair and makeup isn't done and if I put on the same suitevery day the way men do, the reality is there's still a different standard forwomen. Um, and number two, without having wasted another 60 minutes each way ormore commuting, uh, into, uh, and from the office. So there needs to be a.deliberately, collaborative purpose and agenda for journey into the office.

Mm-hmm. and honestly, for me, the desire to take that journeyinto the office really isn't motivated by whether it has spaces that feel likeliving rooms or whether I get mm-hmm. free lunch. Though those things areprobably much more important to young and millennials and to Gen Zers, the drawreally starts mm-hmm.

way before that with my sense of belonging within that firm. DoI feel respected and valued for the work that I do, do my colleagues andpartners and price. Embrace. Mm-hmm. rather than ignore or simply tolerate themultiple depend dimensions of who I am as a black, as a black woman, or do Ineed to contort myself to adapt to a white male dominated space and leadershipstyle that has done very little to adapt me.

Do I have a true career path and potential for growth andadvancement within this firm. Those are the things that I thought about when Istarted my career 25 years ago. Those are the things I think about today formyself, and those are the things I think about for the junior talent on my teamand in my firm that I endeavor to support.

So for me, that space that I occupy while I work has littleinfluence over my sense of engagement with the. , while that engagement canabsolutely be mm-hmm. enhanced by the built environment. The engagement comesbefore and beyond the built environment. The design of the office is important,but I think some, you know, some many perhaps employers may be focusing on thedesign of their spaces.

Mm-hmm. instead of focusing on the ways in which they trulysupport their people. And the last thing that I add on this point is that Idon't think I'm alone particularly, um, being, uh, taking this from theperspective of a woman mm-hmm. , as I look at some of the recent surveys anddata that have come out.

So McKenzie and Lean. , uh, dot org just did their annual Womenin the Workplace survey and they noted that women leaders are leaving theircompanies at the highest rates we've ever seen at much higher rates than menleaders. And so, and one of the many things that they, um, uh, are requestingare deliberately inclusionary environments.

And so a focus that, uh, that employers make on d ei and alsoon autonomy, whether they choose to work a hundred percent from the office, ahundred percent from home, or in some hybrid style. So if we, uh, within thereal estate industry really wanna tap a potential of female employees andfemale leaders, this is something that we have to think about.

Mm-hmm. and be again, really intentional about.

[00:52:32] Adam Hooper: Yeah. And culture is somethingwe've talked about a lot. Again, in the, in the technology world, that's avery, you know, it's a big buzzword right now. You build a culture, um, Evenmore challenging in a remote environment. I'm, I'm curious, how are you? Howare you building that in a remote first environment?

[00:52:47] Onay Payne: Yeah. Yeah, it's a great question.Um, so we, um, are very intentional about building culture. Mm-hmm. , um, it isin very simple ways. For example, we have a standing meeting, um, morningmeeting three days a week, uh, where we are highly transparent, about what'sgoing on within, um, within our, uh, within our every day.

Um, but uh, that's one way we also do re. That we do need tosee each other. We want to see each other on a regular basis. So while we are,that's important, wanting to see each of that. Yeah, exactly. Right. Um, and sowhile we are remote, first, we are, um, intentional about, uh, creating spacesand, and time where we spent together.

Yeah. So whether it's our quarterly retreat, um, or with anindividual teams, um, connecting in person, um, those are part of the waysmm-hmm. . But I would also say that there's a lot of ways, there are a lot ofways that we check up on each other and build culture remotely. And I will say,uh, one of the things that is so interesting, uh, about our, our culture, andwe were studied by a professor at Carnegie Mellon, uh, professor Brandy, andshe said that a lot of firms, um, build culture.

Homophily and prop propinquity. Those are, um, s a t words.Homo, we need to dive in on those ones, right? . So homophily the, um, uh, theinclination to be, uh, to form connection with people who are like you. Mm-hmm., propinquity, the, um, inclination to build PE connection with people who arewithin close proximity of you.

Okay. So even within a specific office building. Pod, thenortheast pod tends to build culture till tends to build trust. Whereas withinour firm, um, some of the things, uh, that we have done in terms of one, numberone being mission aligned mm-hmm. number two, having these structural processesand forms of collaboration and connection that support, um, trust building areimportant.

And so rather than seeing a really dense network of, um,homophily and Propinquity connections, what we have done within our remotefirst firm, uh, which is we're probably in 20 different states, uh, with, uh,uh, for our, our team members, is that you see a really healthy dispersionmm-hmm. of connection.

Mm-hmm. , that, that's suggests culture building, even thoughwe're not in the same physical space five days. A. .

[00:55:13] Adam Hooper: And so is that actually anopportunity of being remote is where you can, you can break.

[00:55:16] Onay Payne: It's an opportunity of beingremote. I think it, for us, we've chosen to make an opportunity. Yeah. Um, and,and I mentioned this on stage, instead of spending money on office space, wehave chosen to invest in talent and in technology in a way that fosters, um,career development and fosters culture building.

So we spend specific time on a weekly basis and, and one ofthese Wonder Day morning meetings mm-hmm. thinking about talent development,um, and um, and things that are, uh, well talent. Talent development andculture building, that's an intentional part of the structure. Um, and youknow, I, I don't think it's that a foreign concept, right?

Mm-hmm. , when I was at Clarion, I managed a team that wasbased in Mexico. Mm-hmm. , half of my teammates were in other states or inother countries. And we had to form, we had to figure out how to work together.Um, effectively, I've had to figure out how to support them. Mm-hmm. , myteammates and their development have how to, um, how to achieve common goals.

And so, um, while there's an absolute, uh, importance to beingwithin proximity of one another on a regular basis, it's not that foreign aconcept. Mm-hmm. , uh, from I think a lot of the lived professional experience,uh, from many of us. Yeah. It's, it,

[00:56:33] Adam Hooper: there's been components of itbefore. I think just what we went through recently just put such a spotlight onit.

Right. It made us define it a little bit more, maybe pay moreattention to. Some of the things that we were already doing before mm-hmm. ,but like I agree more intentional now about how we go about some of those.Mm-hmm. . Um, so as we wrap up here, your, your advice for 2023, I think I gotthis right. Uh, you suggested how to integrate the focus on what you do everyday to combine profit and purpose.

Mm-hmm. , like that's a, again, when you're looking in theimpact world, and we've talked about this on, on a couple of prior episodes,how you, how you price that in, right? Mm-hmm. , the impact has been achallenge, I think, for our industry so far. Yeah. Because it is, it is still aprofit driven mm-hmm. enterprise.

Mm-hmm. . So, so I'd love for you to dig in in a little bit onthat and how do you combine profit and

[00:57:17] Onay Payne: purpose? Yeah. Um, so let me beclear. I'm a capitalist. . , um, but I'm, uh, I'm a conscious capitalist.Mm-hmm. . Um, and I think there's a potential to create, um, as opposed to, um,The zero sum construct that we often live with, where some have to, uh, give upmm-hmm.

in order for others to get, I, I reject that notion. I think wecan create a bigger pie if we create a. Deliberately inclusionary economy.Mm-hmm. and deliberately inclusionary growth strategy that focuses yes, onprofit, but also on purpose. And the way in which we do those things or combinethose things should not be contradictory.

Mm-hmm. , we need to figure out how profit or how purpose cancompliment what we want to do on a profit based, in a profit based way. Um, andso I think sometimes when they are in con those two concepts are incontradiction. Uh, it's because we haven't figured out how to have them beself-reinforcing mm-hmm.

And so the way that we are thinking about it is, um, and I,we'll, we'll have another conversation about our theory of change, but reallyit is very simply that doing the right thing de-risks our investment. Mm. Andso we are able to deliver strong risk adjusted returns. Mm-hmm. . By doing theright thing, doing well and doing good, um, they are in alignment.

Um, and absolutely part of how we move forward, uh, forourselves, for our broader stakeholders, which include our shareholders, butalso our employees and our communities. We can combine the two to do. Good.Perfect.

[00:58:58] Adam Hooper: Well, I think that's a, uh,that's a wonderful point to end on. Onne, thank you so much for sharing yourtime with us.

Uh, how can listeners learn more about what you're up to at Lafayette?Uh,

[00:59:06] Onay Payne: well certainly, uh, go tolafayette Feel free to send me, um, an inbox on LinkedIn. Uh, we, Iwill get back to you. We are excited about, um, engaging, uh, with the broadercommunity and really helping to co-create solutions, um, to address thesocietal needs that we're facing

[00:59:24] Adam Hooper: today.

Perfect. We appreciate your time and have a great rest of the,uh, the fall meeting. Thank you again to Anita, Andy, and Onna. It's alwaysgreat to get insights into Eli's Emerging Trends report. And remember, you candownload the report by checking the show notes. Highly recommend it. Thisconcludes our special series from Eli's fall meeting.

Thank you again to Uli for allowing us to share these insightsand highlights with all of you. If you're interested in attending an upcomingULI meeting or event, we highly recommend it as they're one of the bestconcentrations of influential real estate minds you're gonna find in thebusiness. You can learn more about future meetings by going to andthank you for listening along with us.

With that, we'll catch you on the next one.

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