Berkadia Institutional Solutions Responds to an Evolving Industry

November 16, 2021

Berkadia Institutional Solutions Responds to an Evolving Industry

November 16, 2021

January will mark one year since we announced the launch of Berkadia Institutional Solutions, powered by Moran. One of Moran’s traditions had always been to host an annual client conference—a time to share experiences in the market and perspectives on the future of our industry. Now as part of Berkadia, we continued that tradition in September by hosting many of Berkadia’s institutional clients at the Balboa Bay Club in Newport Beach, California.

One of the most rewarding parts of this event was bringing together most of Berkadia’s 25 regional captains. It was an honor to introduce this new combined team of experts in their local markets, who will work closely with clients as they look to build their businesses across the country.

While the whole day’s events were filled with lively discussions, there were two primary conversations our team had with clients: where our industry is going and how Berkadia is evolving to meet it. We discussed these during the morning’s panel discussions and presentations. But they also extended into the smaller group conversations throughout the day.

Looking around the corner

One of our panel discussions focused on new strategies for a new era, inviting several CEOs from institutional platforms to discuss how they have pivoted their investment strategies during the pandemic and how the experience of COVID-19 and other events of the past year have changed their approach to investing. During this discussion, our panel shared how their companies are making sense of today’s new normal, which includes exponential rent growth and high multifamily occupancy numbers as the industry continues to deal with undersupply. Much of the surge in rental rates has been fueled by moratoriums during the pandemic, many of which are still in place today, that have taken over a million units out of supply. They also talked about challenges they faced with escalating construction costs, labor shortages, and supply chain disruptions.

At this year’s event, there was an increased focus on ESG. Meeting sustainability benchmarks for investors is no longer a “check the box” activity. As investors look to lower carbon emissions by 50 percent by 2030, many have hired teams of analysts to measure their baseline carbon footprint, to help them set goals for carbon reduction in the future and monitor progress towards those goals. When looking at properties and markets, any investment’s ESG profile is now a critical factor in the investment decision process.

Meeting the industry of today… and tomorrow

As we understand what the CRE industry of tomorrow looks like, we in turn shared with clients how we see the future of Berkadia evolving with it. Hilary Provinse, SVP, Head of Mortgage Banking, and I were excited to host a fireside chat with Berkadia’s CEO, Justin Wheeler where he shared the history of the company and where we see our future, for Berkadia as a whole and for Berkadia Institutional Solutions.

Last year, we knew that Berkadia was the right company to acquire the Moran apartment brokerage arm, not only because we wanted to grow our business on the East Coast, leverage Berkadia’s long-standing industry history and integrated services, but also because we knew the culture Berkadia has built as a privately held company was familiar to us.

As Justin shared, Berkadia is making long-term investments in people and technology to disrupt the industry. Rather than being individually oriented, we are focused on building teams that work together for the collective benefit of our clients and their businesses.

We aim to be a CRE firm that is not focused on transactions but instead on being an advisor. It is this advisory role that allows our teams of experts to see around corners and make sense of the evolution of the CRE industry that our clients and panels spent time breaking down. I’m always grateful for conferences like these, but this year was particularly special as we did it with our new partners of Berkadia. Here’s to many more!

-Mary Ann King, Co-Head of Investment Sales and Head of Berkadia Institutional Solutions