Commercial Real Estate Is Key 5/28/18 05/29/18 11:12:21 AM
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James Blackledge, CEO of Mutual of Omaha and David Brown, president of the Greater Omaha Chamber of Commerce, discuss the metro area now and in 2040.
Commercial Real Estate Is Key to the
Successful Growth of Future Metro Area
By Julien R. Fielding
The Daily Record
First thing on April 6, the CRE Summit gave attendees a snapshot of the elements that have contributed to the city’s success and what needs to happen in the future to keep us in the game.
David Brown, president of the Greater Omaha Chamber, moderated a panel that included James Blackledge, CEO of Mutual of Omaha; Dana Bradford, CEO of Waitt Brands; and Tim Burke, CEO of the Omaha Public Power District.
Burke explained that for its OPPD customers, “rates, reliability and relationships” are important.
“We are two years into a no-rate increase, and we have the highest reliability across the U.S.,” he said. “We also get rated relatively high on our relationships.” He added that when it comes to energy, we are in a changing landscape, with a shift from fossil fuels to renewables.
“We are shutting down Ft. Calhoun – on time, and we have seen growth in our renewables. By the end of 2020, 50 percent of electricity from our retail sales will be from renewables. Our customers like that.”
Corporations also seem to like it. When Facebook decided to build its $300 million data center in Papillion, officials from the social media company stated that they wanted to be able to harness renewable power. To satisfy their request, OPPD approved a rate plan, Rate 261M, which was an extension of Rate 261 for large-power, high voltage-transmission-level customers. Rate 261M gives customers “flexibility in how they meet their energy goals, while charging fair and reasonable rates that cover OPPD’s fixed costs, including generation and system capacity, transmission, and administration.” Facebook will work with OPPD to procure 100 percent renewable energy. “This is a rate innovation, Burke added. “It’s one of the greenest rates in the U.S.”
Partnerships are important, Bradford said. “In 2005, I got called into a meeting about the Aksarben area. The racetrack was winding down, and they had no clue what they wanted to do with the property. No one knew. They asked a lot of questions.” Those involved decided to “think big,” asking where UNO was going to go in the next 10 years.” The result was a “highly coordinated public/private partnership.”
Blackledge stated that Mutual of Omaha made a commitment 10 years ago to the Midtown area; to be good stewards in that neighborhood. “Midtown Crossing created a place where people like to work,” he said.
But even a company as big as Mutual of Omaha faces challenges; one of which is retaining talent. “It’s a different environment than it was 15 years ago. It’s an arms race to have an attractive business; that’s what drives us,” he said.
Retail has its own set of challenges, most notably trying to figure out how to best get products to its consumers. Will it be through brick and mortar stores or through a dot.com presence? “We are in a state of flux,” Bradford said. “We are trying to balance that.”
Brown said that Omaha is always thinking about how to continue its growth. In the last 15 years, Omaha has seen $10 billion in capital investments and about a thousand projects get underway, he said. On the positive side, the city has a rising standard of living, low unemployment and a high quality of life. On the downside, Omaha has a slow, steady growth in jobs and GDP, and a lower concentration of both IT-related industries and tech workers. “We have low population growth and low growth rate,” he said.
Bradford explained that our students need to get better ACT scores and be better prepared after they graduate from high school.
“And we are challenged to attract others here; it’s difficult, and we aren’t growing fast enough. We need to keep the kids we have here and put them in better jobs. We are leading the country in people who work more than one job; people need two to three jobs to support themselves. That’s not what we want. We need to leverage our good places to work.”
Another concern Bradford had was that many students “have no sense of how to enter the workforce.” Institutions such as Metropolitan Community College are making a difference, by helping students to develop a career path. “That’s a game changer,” he added.
Brown concurred, saying that right now, 71 percent of the adult population is working, which means that there isn’t a pool of employees from which to draw. “Of this group, one in eight has two jobs or more. We need more tech start-ups, and to be ready to accommodate our next ‘unicorn’ [a privately held startup company valued at over $1 billion].”
“We need greater business/community engagement,” Burke said. “We need to create opportunities for kids to have success in Omaha.” OPPD is doing this, by giving high school seniors, and university students opportunities to see what a career in a utility company is like, by engaging in mock interviews, offering resume critiques and offering internships and cooperatives. “We bring them in early to engage with them,” he added. “We have to be proactively involved in the community so we don’t allow our talent to leave.”
“Talent is what it’s all about,” Blackledge said. “If we aren’t growing, we are dying. If 10 percent of our population leaves, what happens to our asset values? We have to grow and grow at the right pace. We need high growth firms and high skilled talent. We need to attract the workers of the future.”
Diversity and inclusion is another critical component, Brown said. “By 2050 more than half of the U.S. population will be non-white. One of the 2040 goals, for the region, is to have a diverse leadership with 50 percent of business leadership held by women and minorities, powering a reputation that minorities and women excel here.”
Other 2040 goals include: exceptional public schools, with a renewed focus on career-based skills, post-secondary preparation and alignment with regional future-focused jobs; large scale corporate, philanthropic and social support channeled toward young professional attractions, offering social, educational and recreational opportunities; a connected network of welcoming neighborhoods; highly successful and internationally recognized acceleration of technology based start-ups, which creates an acclaimed hub for innovators and entrepreneurs in social and public sectors; and competitive wages compared to other growing talent markets.
“We need high paying jobs, we need incentives to attract people here and keep them here,” Bradford added.
The Commercial Real Estate Summit was held April 6 at CenturyLink Center. The Opening Chamber Panel was from 8:30 a.m. to 9:15 a.m. To view the video from this event, go to www.AttendCRESummit.com and click on 2018 Highlights, Morning General Session 1.