Anna Robaton

Small City, Big Opportunity: Federal Realty Shapes Hoboken’s Future

Kyle Gustafson — Wed, 08 Oct 2025 13:23:10 +0000

Federal Realty views Hoboken as a strong, long-term growth opportunity.

CubeSmart Crafts Personalized Approach to Employee & Customer Engagement

pconnors@reit.com — Tue, 08 Jul 2025 14:17:44 +0000

Self-storage REIT is investing in staff and technology to ensure proactive customer service.

Terravet Seeks Early Mover Advantage in Niche Property Market

pconnors@reit.com — Tue, 14 May 2024 14:44:44 +0000

CEO Daniel Eisenstadt expects to be able to scale holdings to over $1 billion in coming years.

Nareit's Fulya Kocak on ESG Collaboration

rich@richgarcia.com — Fri, 21 Jan 2022 20:45:51 +0000

Nareit's Fulya Kocak on ESG Collaboration rich@richgarcia.com Jan. 21 2022

Anna Robaton

publications@nareit.com

Anna Robaton is a freelance writer and regular contributor to REIT magazine.

Nareit's Fulya Kocak on ESG Collaboration

These days, Fulya Kocak rarely has to explain her ESG title - which speaks to how much the REIT industry has matured on that front in a relatively short time.

Sharing knowledge and best practices, from the beginner to expert level, is in everyone's interest as the complexity and scope of ESG matters only continue to increase, says Fulya Kocak, Nareit senior vice president for ESG issues.

Without collaboration on environmental, social, and governance (ESG) issues, progress in the real estate industry will not be fast enough, Kocak says.

When Kocak joined Nareit in 2016 as its first dedicated staff member for ESG issues, she found that the acronym in her job title elicited some confusion. "At industry events," she recalls, "some people would ask me what the ESG in my title means."

Today, Kocak rarely fields the same question—a change that speaks to how much the REIT industry has matured in a relatively short time on the ESG front. A majority of REITs have now begun their ESG journey, although some are further along than others.

Kocak, who has worked in the sustainability field for more than two decades, led the team that produced Nareit's Practical Reference for ESG Implementation and Reporting© (PDF). Information in the 128-page guide is distilled from ESG standards and frameworks, perspectives from subject-matter experts, and leading practice examples.

REIT magazine spoke with Kocak about the biggest challenges related to implementing ESG programs, how REITs can use the Pratical Reference and other Nareit resources to deepen their commitment to ESG, and where the industry is headed on the ESG front.

What are some of the biggest challenges that real estate organizations face when it comes to developing and implementing ESG programs?

Fulya Kocak is Nareit's Senior Vice President for ESG issues.

Over time, the definition of ESG has expanded far beyond environmental considerations. For any company that's just getting started, ESG can feel overwhelming because there's so much to be done. It's hard to know which framework to follow. Companies may also feel they're in a race against time to stand up ESG programs.

One of the best ways to get started is for companies to leverage what they're already doing in terms of ESG efforts, rather than starting from scratch. I promise you that every REIT has a lot going on around governance policies, human capital, and environmental stewardship.

It's about understanding what they already have in place and coming up with strategies around those efforts that make sense for each company. This is critically important because ESG is not a one-size-fits-all application. Once companies have a strategy in place, they can set goals and start measuring their progress towards those goals.

Why was there a need for the Nareit Practical Reference for ESG Implementation and Reporting publication and what does it offer?

First, some context. In 2019, we published our Guide to ESG Reporting Frameworks (PDF) to help address the confusion around the alphabet soup of ESG frameworks, standards, and guidelines. In preparing that guide, we reviewed various ESG frameworks and guidelines to understand – at a high level – what ESG factors companies were being judged against. For instance, climate change was addressed in every one of those frameworks. Based on that research, we came up with the top-15 ESG criteria.

When we published the Guide to ESG Reporting Frameworks, members and investors said: This is great. You told us what the most-popular cookies are, but you did not give us the recipe. So, how do we implement and disclose around these larger ESG topics?

In the Practical Reference for ESG Implementation and Reporting, we dive into each of the top-15 ESG criteria, exploring how REITs can begin working on each one. For REITs that have already begun work in a particular area and would like to advance in that area, we discuss how you move to the next level and, ultimately, get to a leadership level.

It's a very practical document. I envisioned it as a go-to reference for ESG professionals in the real estate community. It can also be used if you want to educate your stakeholders, internal departments, or pitch something to your CEO—you can use parts of the guide to help with that.

How is the guide organized?

First, each ESG topic is defined. Then, for each topic, we provide illustrative metrics that companies may want to report against, as recommended by relevant ESG standards and frameworks. We also cover action items, challenges, resources, and tools for implementation. In terms of resources, we highlight not just Nareit resources, but others that are relevant and useful. The idea is to provide ESG professionals with everything they need in one place.

What other resources do you recommend for REITs that are relatively new to ESG?

I think Nareit's yearly ESG JumpStart program is a great resource. I like to call it REITs teaching REITs. This year, the program will be held in January and February and have eight, 90-minute virtual sessions on ESG topics, taught by ESG professionals.

We've seen this program grow in popularity. Last year, for the first time ever, most of the attendees were at the vice president or executive levels of their organizations. We also had a very cross-functional group of attendees, from general counsels to human resources professionals. That speaks to the way ESG has evolved. It's in everybody's job description.

I should also mention that we work closely with other real estate organizations, and they have many ESG resources. We collaborate with organizations like the Urban Land Institute, The Real Estate Roundtable, the Real Estate Equity Securitization Alliance, and the Institute for Market Transformation.

When it comes to ESG, unless we work together as an industry, we're not going to make progress fast enough. So, we're all about helping each other as real estate organizations.

One of the topics in the Practical Reference for ESG Implementation is the ESG journey. Would you break down the stops on that journey?

The first stop is organizational awareness: Where are you today? What do you have in place already? What is your social and environmental impact? It's all about self-awareness.

Once an organization is aware of its impact, it can move to the strategic level of identifying its ESG priorities.

If you don't clarify your ESG priorities as an organization, it can be very easy to waste time, money and resources focusing on the wrong things. Identifying your priorities based on your company's operations and stakeholder community is a critical step.

Then, you'll want to come up with a holistic strategy around those priorities. But it has to be cross-departmental. Everybody has to play in this game. Next, you'll want to set goals. Without clear goals, your strategy isn't going to go very far. Once an organization has clear goals, it can begin to work toward those goals and measure its progress year over year. That's how I see the ESG journey in simple terms.

How would you characterize the momentum surrounding ESG in recent years?

ESG has gained quite a bit of momentum during the last five years, particularly over the last 18 months or so. Interestingly, we've seen quite a bit of maturation around ESG during the pandemic, when companies faced many other challenges. ESG is not a wish-list item anymore, but an integral part of many companies' efforts.

The momentum has a lot to do with stakeholder demand. In the past, sustainability was something of a check-the-box exercise for investors. Today, they're asking very thoughtful questions focused on corporate strategies related to ESG and disclosures.

Where is the REIT industry headed in its ESG journey?

The REIT industry has been showing significant progress and leadership in ESG, especially around environmental initiatives. I expect to see increased focus on climate-change related efforts, social initiatives, and disclosures. I also expect to see an increased focus on governance of ESG with short- and long-term commitments around climate action, diversity, equity and inclusion, and other ESG priorities.

Suggested Results

Off

Magazine Issue

January-February

Magazine Issue Year

2022

How REITs Are Putting People First

Kyle Gustafson — Mon, 04 Oct 2021 15:21:14 +0000

How REITs Are Putting People First Kyle Gustafson Oct. 4 2021

Anna Robaton

publications@nareit.com

Anna Robaton is a freelance writer and regular contributor to REIT magazine.

RETs are increasingly focused on investing in human capital.

Prioritizing People

RETs are increasingly focused on investing in human capital.

REITs have responded to events of the past year and a half by doubling down on efforts to put people first. During a period of upheaval, while adapting and responding to challenging business conditions, the industry has prioritized the health, safety, and wellbeing of employees, tenants, and communities, and stepped up commitments to foster diverse and inclusive workplaces.

But investing in human capital has long been more than a talking point for REITs. For many years, they have understood that the value of their physical assets is inextricably linked to the value delivered by their employees and the wellbeing of surrounding communities.

According to Nareit’s 2021 REIT Industry ESG Report, 100% of Nareit members reporting to GRESB have community engagement programs, and 52% of REITs participating in the survey rolled out community relief programs in response to the pandemic. Some 77% of REITs reporting to GRESB implemented new employee engagement practices in response to the crisis.

The report also finds that REITs are making diversity, equity, and inclusion (DEI) not just a priority, but an imperative. Indeed, 98% of Nareit members reporting to GRESB indicated that they monitor inclusion and diversity metrics at the board and workforce levels, and 68% of REITs have policies in place for recruiting and hiring a more diverse workforce.

The following case studies offer a glimpse of the innovation and leadership taking place across the REIT industry when it comes to investing in human capital. Read on to learn more about leading-edge approaches to employee engagement and professional development, diversity and inclusion, and building safety during the pandemic era.

Photo courtesy of Hersha Hospitality Trust.

Hersha Hospitality Mobilizes on Health and Safety

Even before COVID-19 emerged in the United States, health and wellness played an integral role in the approach to sustainability at Hersha Hospitality Trust (NYSE: HT). When the pandemic struck, the hospitality REIT was well-positioned to quickly develop and mobilize a health and wellness program in response to the crisis.

The proprietary program, called Rest Assured, has played a pivotal role in instilling trust and confidence in building safety among hotel guests, associates, and other stakeholders. One of the first institutional health and safety protocols launched by a REIT in response to the pandemic, Rest Assured focuses on employee training, guest experiences, and advanced, science-based cleaning protocols.

To assuage employees’ safety-related concerns about returning to work, Hersha created seven unique employee training modules on COVID-19 workplace leading practices, customized by position and level, and supplemented them with videos, implementation guides, and standard-operating procedures. After completing Rest Assured training, employees are encouraged to wear a pin that visibly recognizes and rewards their commitment to health and safety.

Hersha also surveyed guests to determine what was most important to them when returning to travel. Nearly 90% emphasized the importance of physical distancing, and 71% said they expected hotels to provide some form of personal protective equipment (PPE). In response, Hersha installed front desk plexiglass shields, added plentiful signage, and implemented QR codes and other contactless forms of ordering and payment, among other measures.

Under the Rest Assured program, employee training and guest experiences are complemented by rigorous, CDC-aligned cleaning protocols at the property level. Since implementing Rest Assured, Hersha has found that 91% of guests surveyed feel confident staying at its properties owing to the company’s commitment to safety. The program has also helped Hersha boost the appeal of its properties among professional sports franchises and other guests that demand heightened building safety.

Even though municipalities have lifted many pandemic-era restrictions, Hersha expects to retain many of the most popular elements of Rest Assured, including such technology as mobile check-in, contactless payment platforms, and online menus, says Director of Sustainability Matthew Lobach.

“Looking forward, guests and associates will likely be much more aware and educated on the health and wellness of buildings while traveling and when choosing a hotel. Communication will also remain essential, whether it has to do with air quality, safety protocols, or wellness-focused amenities offered at Hersha’s hotels,” Lobach says.

Photo iStock and Courtesy of Invitation Homes Inc.

Taking Employee Engagement to the Next Level at Invitation Homes

Invitation Homes Inc. (NYSE: INVH) has long worked to foster a culture where employees feel like they’re an important part of the REIT’s mission statement: Together with you we make a house a home.

Until recently, the company relied on a yearly survey that was followed six months later by a ‘pulse check’ to measure employee engagement. Annual or biannual employee engagement surveys tend to have drawbacks, however. Among other things, it can take months for companies to get survey results, which means information may be outdated by the time businesses are ready to act on it.

In April 2020, Invitation Homes decided to try a different approach to employee engagement. The company implemented a continuous-listening platform owned by Peakon (part of Workday Inc.) that allows it to react in real time to employees’ concerns and ideas.

The platform—which Invitation Homes internally branded Our Family. Your Voice.—has 45 questions aligned to 14 drivers of engagement. Each month, employees receive a short email survey containing about nine questions to which they respond anonymously. The platform ensures that all 45 questions are asked during each survey round, and that each employee receives relevant questions. Employees may also leave comments in the platform.

When employees submit their answers, company managers have access to updated feedback and engagement scores. The platform also suggests priorities and actions to managers based on employee feedback. Managers may also engage directly with associates through the platform, although employees retain anonymity.

“The wonderful thing about this [platform] is our associates see and feel the impacts of their feedback and, therefore, continue filling out the survey each month,” says Elizabeth Galloway, executive vice president and chief human resources officer at Invitation Homes.

Indeed, aggregate employee participation in the monthly survey remains high at 89% more than a year after its launch. Invitation Homes has also increased its employee net promoter score from 50 to 55 since it launched the survey in the spring of 2020, which just happened to coincide with the onset of the pandemic. Many companies use net promoter scores, calculated using survey results, as a measure of customer loyalty. Some, like Invitation Homes, have begun using them to gauge employee satisfaction.

Anecdotal evidence also shows that the continuous listening platform has made a difference during a challenging period for many American workers. The platform, for instance, helped Invitation Homes support an employee who felt overwhelmed during the pandemic, Galloway notes.

“The associate was struggling with mental health issues and made a comment in the tool,” she says. After a few anonymous interactions with human resources representatives, the employee decided to come forward and take advantage of the firm’s employee assistance program.

“The associate [later] reached out and expressed how thankful they were for the outlet which helped build trust so that they could get meaningful help,” adds Galloway, who also credits the platform with helping Invitation Homes make strides when it comes to diversity and inclusion, compensation, and employee recognition, among other areas.

Photo courtesy of Sun Communities, Inc.

Nurturing Internal Talent at Sun Communities

At Sun Communities, Inc. (NYSE: SUI), doing the right thing is paying off in more ways than one.

“One of the things that not only do we believe, but we’ve proven, is that you see a significant return on investment when you’re focused on doing the right thing by your people,” says Marc Farrugia, senior vice president of culture and innovation at Sun. The REIT owns, operates, or has interests in more than 560 manufactured home, recreational vehicle, and marina properties in the U.S. and Canada.

Sun’s commitment to doing the right thing by employees has given rise to a robust internal development program, among other things. The program has helped community managers rise to such roles as senior vice president and paved the way for a number of lateral moves, such as from accounting to sourcing.

Team members are encouraged to apply for internal job postings that align with their interests. As much as possible, Sun fills positions with internal candidates to encourage professional development. A team of trainers—complemented by an extensive library of online learning resources—supports advancement through talent planning and individualized learning plans. On average, Sun fills 21% of open positions each year with internal candidates.

To build on the knowledge and expertise of team members, Sun also has a mentoring program that pairs new community and resort managers with experienced counterparts, as well as a rigorous Executive Management Certification (EMC) program. The latter has helped such team members as Andrew Delong rise through the company’s ranks.

A former property manager, Delong was promoted to his current role, regional vice president of operations, shortly after graduating from the six-month EMC program, which focuses on operations knowledge and critical professional skills, such as leadership.

The program “was one of the more difficult learning programs I’ve participated in,” Delong says. “However, for every bit of difficulty, it was equally rewarding. It deepened my skill sets and challenged what I was capable of. After completing the program, I’m ready to face any future challenges confidently.”

Every other year, Sun hosts a leadership conference that brings its main office and operations leadership teams together to network and build on existing skills through in-person learning and collaboration. Attendees share best practices, participate in team-building events, attend educational sessions, and take part in community outreach projects.

Such events, Farrugia says, have not only helped team members grow professionally but also to feel more connected to the company, which has a geographically dispersed workforce that grows to nearly 4,700 employees during peak seasons.

“As we’ve grown over the years through acquisition, the strategy has always been: how do we focus on bringing team members in, welcoming them with open arms, acclimating them to our culture, and maintaining that small company feel,” Farrugia says.

When it comes to investing in employees, Sun is hardly resting on its laurels. In conjunction with a rebranding of its RV line of business, the company plans to roll out a new hospitality program that will provide advanced training to larger numbers of team members, including property-level talent. Sun is also revisiting the compensation structure for its field team, with an eye toward possibly establishing a company-wide minimum wage that surpasses state requirements.

“There’s a constant investment that we make in our team. We don’t look at it as more overhead. We feel it’s just the right thing to do,” Farrugia says.

iStock photo.

Supporting New Families At W.P. Carey

W.P. Carey Inc. (NYSE: WPC) is helping to redefine what it means to foster a diverse and inclusive workforce. In 2019, the net lease REIT launched an adoption and surrogacy assistance program that is open to all employees, regardless of gender identity or sexual orientation.

The program reimburses employees for up to $10,000 per adoption and up to $20,000 per birth via surrogacy. It is complemented by the Carey Fund, which offers a $2,000 yearly allowance to reimburse employees and their family members for medical expenses. In addition, the company’s primary and secondary leave policy allows all primary caregivers, regardless of gender, to take three months off to care for newborns or newly adopted children.

In 2020, less than half of U.S. employers surveyed by Willis Towers Watson said they offered reimbursement for adoption, and many of those who provided the benefit set a reimbursement limit per child, with a median of $5,000. Surrogacy assistance was even less common. Only 9% of employers surveyed offered a surrogacy reimbursement program, and more than two thirds of them set a reimbursement limit per child, with a median of $10,000.

“Our adoption and surrogacy assistance program is a great testament to W.P. Carey’s commitment to DEI, particularly the ‘E’ as it relates to the equalization of access to a natural family process that is often more difficult for LGBTQ+ families,” says Alberto Da Silva, head of diversity & inclusion and equity & compensation manager at W.P. Carey.

The adoption and surrogacy assistance program is part of Connecting With the Whole You, a compensation and benefits program. Each year, the company reviews its suite of benefits to ensure that the offerings meet the needs of its diverse and evolving workforce. The company is also supporting adoption through its charitable giving, having recently contributed to helpusadopt.org. The nonprofit helps individuals and couples manage the often high costs associated with the adoption process.

“Helping employees realize their dream of starting a family, should they choose, is part of this holistic connection,” says Da Silva, who plans to use the adoption and surrogacy assistance program himself.

Having recently bought a house, Da Silva and his boyfriend are ready to start a family. He says the adoption and surrogacy assistance program will help to ease some of the financial concerns associated with becoming a parent. But the value of the program, he notes, goes well beyond financial considerations.

“Knowing that I have access to a robust offering from W. P. Carey certainly eases some of the financial concerns associated with becoming a parent. But, most importantly, feeling the emotional embrace from the company I work for—expressed in the day-to-day interactions with my colleagues and manifested in these generous benefits—makes the difference,” Da Silva says.

Suggested Results

Off

Magazine Issue

September-October

Magazine Issue Year

2021

Uniti Group’s Fiber Networks Play A Critical Part in America's Broadband Buildout

Kyle Gustafson — Sun, 01 Aug 2021 21:12:11 +0000

Uniti Group’s Fiber Networks Play A Critical Part in America's Broadband Buildout Kyle Gustafson Aug. 1 2021

Anna Robaton

publications@nareit.com

Anna Robaton is a freelance writer and regular contributor to REIT magazine.

Uniti Group’s extensive fiber network is expanding the opportunities of broadband access for new areas of the country.

Laying the Groundwork

Uniti Group’s extensive fiber network is expanding the opportunities of broadband access for new areas of the country.

Uniti Group President and CEO Kenny Gunderman.

Uniti Group Inc. (Nasdaq: UNIT) is playing a critical role in helping to unite disparate parts of the country virtually by building out its robust fiber network to meet the booming demand for superfast internet access, or broadband.

Fiber, according to Uniti, is the “mission-critical connective tissue” for nearly all current and future broadband delivery. The technology, which transfers data at nearly the speed of light, has helped pave the way for what Uniti president and CEO Kenny Gunderman calls the “virtualization of our culture”—a trend that has accelerated recently with the growing adoption of remote work and learning, telemedicine, and other types of digital platforms.

Little Rock, Arkansas-based Uniti buys and builds fiber networks and leases them on a long-term basis to telecom firms, tech companies, government entities, and other types of tenants. With more than 125,000 route miles of fiber (the actual distance of the fiber conduit) and nearly 7 million strand miles of fiber (the number of fiber strands in the conduit multiplied by the route distance), Uniti’s fiber network spans 40 states.

“What happened during COVID was a reaffirmation of the mission-critical nature of our networks because we didn’t see any disruption in our business,” Gunderman says. “In fact, many of our customers recommitted themselves to the use of our networks to stay connected virtually, and I think we’ll see an acceleration of that in the coming years.”

According to Matthew Dolgin, a Morningstar analyst, internet traffic is growing by about 30% a year, thanks to the widespread adoption of video conferencing and streaming services and advances in artificial intelligence and the Internet of Things, among other trends. “We, as a society, use more and more data all the time, which means that data has to be going through pipes. To me, that’s a good thing for fiber infrastructure companies,” like Uniti, he says.

A Singular Spinoff

A former investment banker specializing in telecommunications, Gunderman has been at the helm of Uniti since the company was formed in April 2015 through a spinoff of Windstream Holdings Inc.’s fiber and copper networks. Gunderman says he walked away from a 20-year career in investment banking to run the fledgling REIT because, “as they say in the South, I wanted to eat my own cooking, as opposed to giving advice.”

Right after the spinoff, Windstream—a Little Rock, Arkansas.-based telecom firm serving rural markets—leased its former networks, essentially becoming Uniti’s sole tenant at the time. The sale-leaseback transaction would serve as a template for Uniti’s growth in the ensuing years.

The company’s formation, Gunderman says, was one of the first-ever C-corp-to-REIT spinoffs. It was also the first-ever C-corp-to-REIT spinoff of a fiber network, he says, noting that the timing coincided with the early stages of a new phase of network investments by the country’s largest wireless carriers.

Either way, such a spinoff isn’t likely to be easily replicated, according to Bora Lee, a vice president at RBC Capital Markets.

“As part of the spinoff process, Windstream received an IRS private letter ruling that allowed an OpCo-PropCo spinoff and REIT conversion,” Lee says. “Since then, there’s been legislation and IRS regulations that have largely closed the door on replicating a similar transaction,” she adds.

Uniti’s taxable REIT subsidiary, she says, gives it the flexibility to make acquisitions of companies that otherwise wouldn’t be permissible in the REIT structure. What’s more, the company’s UPREIT structure allows it to use operating partnership units as tax-efficient currency for acquisitions.

Growth out of the Gate

And, in fact, the company has undertaken a spate of acquisitions over the past six years. Since 2015, it has executed nearly 20 transactions, deploying some $2 billion in the process.

As a result, Uniti now owns the country’s eighth largest fiber network, according to company estimates and the Kagan research group, part of S&P Global Market Intelligence. Mergers and acquisitions (M&A) activity has not only helped grow the company’s fiber network but also diversified its tenant base.

“In the last six years, we went from basically no diversification to about 35% (non-Windstream revenue). So, we’ve moved the needle quite dramatically,” Gunderman says. “We’ve gone from essentially one customer to about 26,000 customer connections. There’s been a tremendous amount of growth in our business and a tremendous amount of growth in the use of fiber,” he says. Gunderman has also leveraged his contacts in the telecom and private equity worlds to help Uniti make acquisitions.

While Uniti has grown largely through acquisitions since its inception, Gunderman says the company has also begun to grow organically by leasing capacity on shared networks to new users.

Of the $1 billion in total contract value in Uniti’s leasing pipeline as of the first quarter of 2021, some 75% of the deals related to fiber acquired as part of the settlement agreement with Windstream, according to Uniti.

Tenants that lease fiber from Uniti include some of the country’s biggest consumers of broadband, such as AT&T, Verizon, T-Mobile, Google, and Amazon. The average contract term of these leases is 10-20 years, while the company’s average contract term remaining is nine years.

“Our strategy is to buy or build fiber all across the country,” Gunderman says. “Generally, these networks have anywhere from 12 to 144 strands per route, which means that you can lease up the networks to dozens and dozens of customers.”

Gunderman says Uniti has “a very simple business,” renting both dark fiber and lit fiber. Dark fiber, according to Uniti, is fiber that has not yet been connected to telecom transmission equipment or optronics and thus hasn’t been activated, or ‘lit.’

“Dark fiber and the access to use fiber to connect to towers and small cells has been one of the fastest-growing parts of our company, given the explosion in wireless broadband,” he says.

Transformational Technology

Fiber may be an esoteric technology, but it’s hardly new. It dates to the 1970s and, according to some experts, has played a pivotal role in ushering in the information age. A vast undersea network of fiber already stretches around the globe, connecting continents virtually.

In the U.S., many thousands of miles of copper cables have been already replaced with fiber and the process continues, Gunderman says. Fiber, he notes, faces no real challenges from competing technologies.

“Fiber, in effect, is glass, but it’s extremely refined,” Gunderman explains. Because of the physics of that glass, there are no physical technologies that are being developed to replace fiber, he says. “Satellite or wireless spectrum are ways to transmit broadband, but because of the physics, they’ll never be able to surpass fiber in terms of speed and latency. It’s just not physically possible.”

Gunderman is equally bullish on Uniti’s growth prospects. He says the company plans to continue to grow its fiber portfolio through development and acquisition and will continue to diversify its leasing revenue mix over the next several years.

“We’re the eighth largest network in the country, and we plan to keep moving up that ranking,” Gunderman says. “Our current diversification (of non-Windstream revenue) is about 35%, and we certainly want to get that well north of 50%. And I think we’ll continue to grow our networks into new markets,” he adds.

Currently, Uniti’s fiber network is largely concentrated in the Eastern United States, and, more specifically, in the Southeast. It has a footprint in some of the country’s largest markets but much of it is in so-called second- and third-tier markets, or what Gunderman calls “non-NFL markets.” And that’s by design.

“We actually have a pretty robust footprint in the bigger markets. But it’s our focus to be first movers in the smaller markets,” Gunderman explains. “A big part of what’s happening in the country today is there’s a major push to get more and more broadband into underserved communities. So, we’re going to continue expanding our network into the inner city and rural areas of the country.”

Broadband Divide

As it expands its reach, Uniti is helping to narrow the country’s longstanding rural-urban broadband divide.

The disparities between rural and urban markets are largely a function of the high cost of building fiber networks, which are intended to last for more than 50 years, Gunderson explains. To offset the steep costs of development, carriers have traditionally focused on markets with the largest concentrations of potential customers—in other words, the country’s biggest metro areas.

That said, growing demand for and use of bandwidth-intensive devices and applications is helping to bring down costs, making it more economically feasible to extend broadband into rural areas of the country, Gunderman says.

President Biden’s multibillion-dollar infrastructure plan calls for tens of billions of dollars in funding to expand access to broadband. Gunderman says the initiative builds on past federal programs that have successfully subsidized the expansion of broadband in rural communities.

Gunderman is optimistic about the prospects for bipartisan action on extending the nation’s broadband footprint. As a builder and buyer of fiber networks, he also believes Uniti will ultimately benefit from that action, whether directly or indirectly.

“Both parties are in favor of continued investment in broadband. And a big part of these dollars that are being earmarked will be spent on building new fiber networks,” he adds.

Leading the Way

Whether they own fiber, towers, or data centers, REITs, Gunderman says, are uniquely positioned to help expand the country’s digital infrastructure.

“The thesis, when we were created, was that our REIT structure would attract REIT investors because of the nature of our business and how comparable it is to the tower sector,” he explains.

Like cell tower REITs, Uniti owns so-called long-lived real estate assets that are leased to third parties, has a high level of recurring revenue (some 95%), and a low level of tenant turnover. The company’s monthly churn rate is less than a half percentage point, Gunderman notes.

“All of these things lead to a highly predictable and supportable cash flow. And that allows us to not only progressively grow our cash flow but to pay a nice steady dividend, which is what REIT investors like,” he says.

Suggested Results

Off

Magazine Issue

July-August

Magazine Issue Year

2021

Equinix Plays a Key Part in the Digital Economy

Kyle Gustafson — Tue, 15 Jun 2021 19:53:25 +0000

Equinix Plays a Key Part in the Digital Economy Kyle Gustafson Jun. 15 2021

Anna Robaton

publications@nareit.com

Anna Robaton is a freelance writer and regular contributor to REIT magazine.

Equinix CEO Charles Meyers has overseen the REIT’s growing global presence and positioned it as a powerhouse in the technology and networking real estate space.

Making Connections

Equinix CEO Charles Meyers has overseen the REIT’s growing global presence and positioned it as a powerhouse in the technology and networking real estate space.

Equinix’s TY12 data center in Tokyo. Photo courtesy Equinix.

Equinix, Inc. (Nasdaq: EQIX) was founded in 1998 during a period that’s been dubbed the internet gold rush. Despite the intervening two-plus decades, Equinix President and CEO Charles Meyers believes that the world is still in the early phases of technological advancement, which bodes well for data center demand.

While Equinix may not be a household name, its global network of nearly 230 data centers is a key part of housing the infrastructure of an increasingly digital world. Spanning 26 countries across five continents, Equinix helps companies deliver online services and experiences quickly and securely.

“I often refer to Equinix as the engine room for the digital economy,” Meyers says. “What we do is build, operate, and interconnect data centers where our customers place the digital infrastructure that allows businesses and consumers to accomplish the things we do every day—whether that’s trading stocks on Nasdaq, watching a movie on Netflix, or hosting a Zoom call.”

Based in Redwood City, California, Equinix was founded by Jay Adelson and Al Avery, facilities managers at the former Digital Equipment Corp. The two settled on the name Equinix as a nod to the company’s core attributes: equality, neutrality, and internet exchange.

Colocation Catches On

During the early days of the internet, Equinix developed data centers that gave competing networks and pioneering content providers such as AOL, Microsoft, and Yahoo a neutral place to interconnect. For the first time, they were connecting across rooms—rather than across long distances—which improved data security and reduced latency, or lag time.

The colocation real estate model clearly caught on. Today, thousands of networks exchange internet traffic within Equinix data centers—highly secure, industrial-like facilities that house compute, data storage, and networking equipment.

The company’s tenants include more than 2,900 cloud and information technology (IT) service providers and some 1,800 network service providers, such as Verizon, AT&T, and Cisco. Equinix also has more than 10,000 enterprise customers across a number of sectors, from automotive to financial trading. Equinix’s enterprise customers include more than half of all Fortune 500 companies and a third of the publicly traded firms in the Forbes Global 2000 ranking.

The company charges its tenants for space, power, and cross-connects. In fiscal 2020, its revenues rose by 8% on a year-over-year basis to nearly $6 billion. Equinix also marked its 18th year of consecutive quarterly revenue growth. Total physical and virtual interconnections, or private data exchanges between businesses, surpassed 386,000 in last year’s fourth quarter.

Equinix CEO Charles Meyers. Photo courtesy Equinix.

“All of the things in the digital universe that people do every day are made possible by companies being able to put their IT infrastructure where it needs to be and connect it to the right networks,” Meyers says. “A data center without interconnection is just a big refrigerator.”

Global Push

Meyers worked in the tech sector for more than two decades before joining Equinix in 2010 as president of its Americas region. He held several senior leadership positions during a period of rapid growth for Equinix before taking the helm in 2018.

One of his priorities as CEO has been to continue to expand Equinix’s global reach, which allows it to offer one-stop shopping to companies deploying their IT infrastructure across multiple markets. Equinix, for instance, has helped Zoom, the fast-growing, video-collaboration platform, quickly scale its digital footprint at home and abroad. Today, portions of Zoom’s IT infrastructure are housed in Equinix data centers in nine markets.

When Meyers was named CEO, Equinix had data centers in 15 of the world’s 20-largest markets, as measured by gross domestic product. Today, the company has data centers in all but one of them, Russia. Worldwide, Equinix now owns and operates more than 26 million square feet of data center space, the equivalent of 540 football fields end to end.

As CEO, Meyers has overseen forays into Canada, Mexico, India, and South Korea—expansive markets where the data center sector is less mature than it is in the U.S. Last year, for instance, Equinix expanded into India by acquiring the local operations of data center company GPX Global Systems Inc. in an all-cash, $161 million deal.

Thanks to the acquisition, Equinix customers now have access to a network-dense, data center campus in Mumbai, the country’s largest city and a financial hub. Core digital sectors in India, such as IT and digital communications services, are projected to double in size by 2025, contributing as much as $435 billion to domestic economic growth, according to McKinsey.

Equinix plans to use its newly acquired India operations as a platform for further expansion across the country—replicating a strategy it has used in other foreign markets, where developing data centers without local know-how and boots on the ground can be a fraught endeavor.

“If you’re a multinational corporation, you want to have your IT network connected in the simplest way possible. But it’s really challenging to lease data center space from multiple companies across the globe,” says Green Street analyst David Guarino.

“Equinix has expanded its footprint across the globe and found a way to connect their data centers. So, if you’re Coca-Cola, for example, and you want to connect through data centers in the U.S., Latin America, Europe, and Asia, Equinix can do that on its platform— securely and with a low-latency experience,” Guarino says.

A Different DNA

Under Meyers, the company has not only expanded its global reach, but continued to enhance products and services to meet the evolving needs of customers. For instance, Equinix recently developed a software-defined platform, called Fabric, that allows enterprise IT customers to buy interconnections remotely and in real time—a move that reflects changing customer expectations in an on-demand world.

“Equinix is very focused on the connectivity side of the business, along with leasing out data center space to tenants,” Guarino says.

Meyers says the digital transformation of companies will continue to fuel strong demand for data center space—and he’s not alone in that view. The sector’s resilience during the pandemic and its demand outlook have piqued the interest of a number of deep-pocketed private investors. A flood of capital coming into the space is expected to boost supply and mergers and acquisitions activity.

“A lot of capital is going into expanding or purchasing smaller platforms, growing bigger ones, and creating new platforms from scratch. In the private market, infrastructure funds, sovereign wealth funds, and pension funds are all quite active,” says RBC Capital Markets analyst Jonathan Atkin.

SY5, Equinix’s International Business Exchange data center in Sydney, Australia. Photo courtesy Equinix.

Hyperscale Focus

Equinix is hardly resting on its laurels. Meyers expects to see further segmentation of the data center market with growth concentrated in two areas: its existing product type (network-dense, co-location centers) and centers designed to meet the deployment needs of so-called hyperscale customers like Google Cloud, AWS, and Microsoft Azure as they build out their public cloud services. That’s why Equinix recently accelerated its commitment to the hyperscale market through a $3 billion joint venture with GIC, Singapore’s sovereign wealth fund.

Equinix contributed 80% of the joint venture’s equity capital, and GIC contributed the balance. The joint venture, Meyers says, will also raise capital in the debt market to finance its projects. Earlier this year, Equinix opened its first two xScale data centers in Japan and France and has projects underway in several other markets.

A hyperscale data center, which may span several hundred thousand square feet, is a type of wholesale product, typically occupied by no more than a few tenants. Hyperscale facilities tend to consume more power on a per-square foot basis than other types of data centers, which is why they’re often located farther away from urban centers, where it is relatively cheap.

“What the joint venture allows us to do is expand aggressively in the hyperscale space without using all of our balance sheet in that area because we really want to preserve our balance sheet for the more retail-oriented side of the business,” Meyers says. “I think Equinix is really well-positioned in both of these spaces,” he adds.

Flocking to the Cloud

Many businesses use cloud technology—either entirely or partially—to store and access data and programs over the internet for reasons that include security, convenience, reliability, performance, and cost.

“There are a couple things that are increasingly true about how people think about their IT infrastructure: it’s more heavily distributed, meaning it has to go out closer to end users, and it’s increasingly cloud-connected,” Meyers says.

“This notion of being cloud-connected is a really important piece of what we do,” he adds, noting that the Equinix platform already has more than 40% of the public cloud on-ramps, or services that provides direct connectivity to a cloud provider, in markets where it operates.

In 2020, cloud providers drove new leasing in the global data center sector, which experienced record-setting demand, according to Green Street. Microsoft and TikTok’s parent company dominated leasing activity in the U.S., where, according to Guarino, fundamentals are strong but slightly softer than they are in Europe and Asia.

“There’s more and more demand for data center space as enterprises shift their IT hardware away from their own facilities and into third-party facilities. So, data center operators such as Equinix benefit from that migration,” says Atkin of RBC.

Just Warming Up

Companies are expected to spend nearly $7 trillion on digital transformation through 2023, according to market intelligence firm International Data Corporation.

“The cloudification of the IT world is the mother of all [digital] ecosystems,” Meyers says, adding that the rollout of 5G wireless technology, advances in artificial intelligence, and the growing number of internet-connected objects (the Internet of Things) are also powerful forces.

By 2035, 5G wireless networks alone are expected to generate some $13.2 trillion in global economic value, according to IHS Markit. What’s more, artificial intelligence is expected to contribute about $13 trillion to the global economy by 2030, according to McKinsey.

“People often ask me, ‘What inning are we in?’” when it comes to technological change, Meyers says. “I used to say, ‘They haven’t even sung the national anthem.’ I think we’re past that [stage] now, but we’re still in the early innings of how this all plays out. I’m as optimistic as ever about the future of our company.”

Green Goals

Equinix’s TY11 data center in Tokyo. Photo courtesy Equinix.

Ask Charles Meyers what opportunities he saw when he took the helm of Equinix in 2018, and he’ll talk about expanding the company’s global reach, enhancing its products and services, and delivering greater levels of customer service consistency across regions. Deepening the company’s commitment to sustainability has been no less important, he says.

In recent years, Equinix has been especially focused on addressing climate change by minimizing its own carbon footprint and partnering with dozens of other companies and several non-governmental organizations to advocate for the procurement and scaling of clean and renewable energy globally.

“As one of the largest consumers of power in the world, we really feel our industry has a social responsibility and obligation to ensure that the power we consume is done so responsibly and sustainably,” Meyers says.

To reduce its portfolio’s carbon footprint, Equinix has worked to boost its energy efficiency and use of clean and renewable energy. The company is already well on its way to meeting its goal (set in 2015) of using clean and renewable energy to power its entire portfolio. As of 2019, 92% of its portfolio, which spans five continents, was powered by renewable energy, up from 34% in 2015.

The company’s renewable energy efforts reduced its carbon footprint by 60% over the four-year period ending in 2019, even as its data-center footprint and energy consumption doubled during the same period. Equinix’s renewable energy comes from wind farms in Oklahoma and Texas and local clean energy programs in the U.S., certified green power from its suppliers in Europe, and international certificates from renewable energy projects in China, Japan, and Vietnam.

Equinix’s efforts on the environmental front are part of a service-oriented corporate culture that Meyers describes using the catchphrase “in service to.” Firstly, employees are encouraged to be in service to each other—putting the “we” before “me,” he explains. The approach, he says, has helped Equinix foster a climate where “every person, every day can confidently say, ‘I’m safe. I belong, and I matter.’”

The firm’s employee resource groups, which it calls Employee Connection Networks, are a manifestation of its service-oriented culture, according to Meyers. The employee-led groups create belonging and enhance career development for LGBTQ, veteran, and African American employees, among others.

“Being in service to each other allows us to be in service to our customers, our investors and the communities in which we operate,” Meyers says.

Suggested Results

Off

Magazine Issue

May-June

Magazine Issue Year

2021

Post-IPO Complete, Broadstone Net Lease Continues Its Disciplined Approach to Capital Deployment

Kyle Gustafson — Thu, 08 Apr 2021 19:29:52 +0000

Post-IPO Complete, Broadstone Net Lease Continues Its Disciplined Approach to Capital Deployment Kyle Gustafson Apr. 8 2021

Anna Robaton

publications@nareit.com

Anna Robaton is a freelance writer and regular contributor to REIT magazine.

Post-IPO Complete, Broadstone Net Lease Continues Its Disciplined Approach to Capital Deployment

Broadstone’s strategy has helped insulate its portfolio during periods of economic stress and allowed the company to adjust to changing market conditions.

Broadstone’s tenants include health care facilities, like this one in North Little Rock, Arkansas.

Broadstone Net Lease, Inc. (NYSE: BNL) has come a long way over the course of its history. Yet in some regards, the newly public net lease REIT hasn’t changed at all.

Rather than hitching its star to any single tenant type or geographic market, Broadstone has long cast a wide net with regard to portfolio composition—a strategy that’s helped insulate its portfolio during periods of economic stress and allowed the company to adjust to changing market conditions.

“Diversification has been incredibly important to us. We’ve been intentionally diversified since inception,” says Chris Czarnecki, president and CEO of Rochester, New York-based Broadstone.

When Czarnecki joined the then-private company in 2009, it was just over a year old and had fewer than 10 employees. Yet Broadstone had already begun to set itself apart from many other investors in net lease properties by tiptoeing into the health care and industrial sectors.

As of December 2020, its portfolio consisted of 641 single-tenant properties in 41 states (and one Canadian province) across the industrial, health care, restaurant, office, and retail sectors. Under the triple-net lease structure, tenants pay all property-level expenses, including taxes, insurance, utilities, and maintenance.

Properties leased to health care and industrial firms account for about 65% of Broadstone’s portfolio, as measured by their contribution to its annualized base rent. Its health care properties house clinical and surgical centers, as well as specialty and veterinary facilities. Because of their essential nature, such tenants have tended to fare better during the pandemic than movie theaters, fitness centers, and certain other types of tenants that are common to the net lease space.

Outback Steakhouse is among Broadstone’s top-20 tenants.

National Footprint

Geographic diversification has also served Broadstone well. While restaurants have been hard hit by the pandemic, some of Broadstone’s largest restaurant tenants have a national footprint, which has helped to mitigate the impact of restrictions on dine-in activity in parts of the country.

Many of the same tenants have master leases with Broadstone that span multiple states and metro areas. Red Lobster is Broadstone’s largest tenant, as measured by its contribution to annualized base rent. Jack’s Family Restaurants, Outback Steakhouse, and Krispy Kreme are also among its top-20 tenants.

The company’s footprint in Texas is perhaps the best illustration of its deep level of diversification. The state is Broadstone’s largest market and its holdings there generate approximately 10% of the company’s annualized base rent. Within Texas, the company has properties in 20 different metro areas and 29 tenants spanning 16 industries.

“It just gets more and more granular as you go,” says Czarnecki, adding that Broadstone was among the best-performing net lease REITs in 2020, as measured by rent collection, largely because its holdings aren’t concentrated in any one market or industry by tenant type.

During the second quarter of last year—when many states began to lift stringent lock-down measures—Broadstone collected about 95.5% of its rents, according to the company. Its rent collection rate rose to 98% in the third quarter and to 99% in the fourth quarter.

“You had this massive credit event, in the form of COVID, that stress-tested portfolios, and Broadstone’s portfolio performed particularly well,” says J.P. Morgan analyst Anthony Paolone.

In April and May 2020, rent collections for net lease REITs averaged in the 70% range, according to J.P. Morgan Research. Broadstone, Paolone says, not only performed well relative to its peer group in terms of rent collection but did so despite the fact that it had a comparatively low level of investment-grade rated tenants.

At the time of Broadstone’s initial public offering (IPO) in mid-September 2020, the percentage of investment-grade rated tenants in its portfolio was about half the average for its peer group, 16% versus 36%, according to J.P. Morgan.

“You’d think that the lower the credit quality of your tenancy, the greater the likelihood that you’d have rent collection challenges due to COVID. But that wasn’t the case for Broadstone,” Paolone says. “That reflects well on management’s ability to underwrite tenants and assets,” he adds.

Pre-IPO “Public Company Mentality”

Not only has Broadstone come through the pandemic relatively unscathed, but its transition from private to public company hasn’t been a huge leap, according to Czarnecki. That’s because Broadstone has long operated like a public company on many fronts—from transparency to managing its balance sheet. Its modus operandi hasn’t gone unnoticed.

“They’ve had a fiduciary mindset in terms of being transparent and running things with an appropriate level of risk controls and disclosure: The things that we think are pretty important in the public markets,” Paolone says.

Broadstone was founded in 2007 by Amy Tait, its current chairman and a veteran of Home Properties Inc., a former multifamily REIT that was purchased in 2015 by an affiliate of private equity firm Lone Star Funds. Tait served as the company’s CEO from inception through 2017 before transitioning into her current role. She intends to retire from her position in May.

Broadstone began as a so-called friends-and-family offering and over time gained a following among high-net-worth investors and independent wealth advisors to trust companies, private banks, and individuals. As a private company, it raised more than $2 billion in capital from outside investors over more than a decade.

In 2016, Broadstone received a Baa3 investment-grade credit rating from Moody’s, a notable accomplishment for a relatively small, privately held firm, Czarnecki says. The following year, the company became a public filer with the Securities and Exchange Commission, owing to the fact that its shareholder count had reached 2,000.

“Do things the right way for the right reasons is a phrase we use a lot,” Czarnecki says. He worked in banking before joining Broadstone and took over the helm in 2017. Before becoming CEO, he served as CFO.

Why has Broadstone long embraced a public company mentality? Czarnecki points to the influence of its founder.

“We sourced our capital privately for 13-plus years before going public and continued to grow the portfolio, but we always had a public company mentality by virtue of Amy’s guidance and experience in the [public-company] space,” Czarnecki says.

Primed for External Growth

Through its IPO, Broadstone raised more than $588 million, which it designated for future acquisitions and to pay down unsecured debt and its revolving credit facility. In keeping with its pace of acquisitions over the past five years, this could translate to roughly $500 million in acquisitions in 2021 for the firm.

“Given our size, that is meaningful external growth,” he notes. As a public company “we’re large enough where we matter and people want to hold our stock, but not so large that we need to do $3 billion to $5 billion worth of acquisitions a year to deliver superior results,” Czarnecki adds.

Broadstone was among the best-performing net lease REITs in 2020, as measured by rent collection, largely because its holdings aren’t concentrated in any one market or industry by tenant type. – Chris Czarnecki, President and CEO

The company remains bullish on industrial and health care properties. Within the health care space, Czarnecki says Broadstone will continue to focus on facilities leased to hospital-affiliated providers, but located off main campuses, typically in suburban settings. In addition, Broadstone will continue to invest in facilities leased to dominant regional physicians’ groups specializing in such areas as eye health and orthopedics.

To a lesser degree, Broadstone is looking to acquire buildings occupied by fast-food and quick-service restaurant chains and internet-resistant retailers, such as Tractor Supply Co. and dollar stores. Tractor Supply Co. is among the company’s top-20 tenants, as measured by contribution to annualized base rent.

Broadstone is taking something of a wait-and-see approach to certain other sectors that remain in the cross hairs of the pandemic, such as casual dining and office. “We have some exposure [to casual dining], but with the pandemic, many operators are still finding their footing in terms of business models,” Czarnecki explains. “Office is a small part of our portfolio, at just 17 properties. We feel good about the term and credit of our office exposure, but we want to make sure we understand the broader landscape as the work-from-home trend plays out,” he says.

Navigating a Crowded Field

Broadstone certainly isn’t the only investor that’s bullish on industrial and health care net lease assets. BMO Capital analyst John Kim says there’s plenty of competition for such properties, but he’s confident that Broadstone will be able to execute its near-term growth plan. BMO Capital estimates that Broadstone will grow its annual earnings by about 8% in 2021 and 2022, mostly through acquisitions.

“Given its track record, current size, the interest rate environment and coming out [of its IPO] with a strong balance sheet, Broadstone has a lot of opportunity to grow earnings, mostly through acquisitions,” Kim says.

Broadstone, he adds, also has a relatively high level of internal growth because of its asset mix. As of December 2020, the weighted average annual rent escalation for its portfolio was 2.1%, which, according to Kim, is relatively high for a net lease REIT.

With its IPO in the rear-view mirror, Broadstone has wasted no time when it comes to deploying capital. In the fourth quarter of 2020, it acquired more than $100 million of assets, including industrial, quick-service restaurant, health care, and select retail properties.

“For us, it’s about continuing to maintain our discipline and continuing to pick spots where it makes sense [to invest],” says Czarnecki, noting that deal-making activity in the fourth quarter illustrates that Broadstone can continue to compete for industrial and health care assets.

Tractor Supply Co. is among Broadstone’s top-20 tenants.

Relationships Matter

What does Czarnecki see as his biggest challenge as CEO? Ensuring that the firm’s more than 70 employees stay engaged and focused after many months of working remotely, he says.

Fortunately, Czarnecki says, many of them have worked together for years, which has helped mitigate some of the challenges tied to remote work. The company’s average employee tenure is about four years. For senior employees, average tenure is just over five years.

“The longevity of working together has helped us a lot,” Czarnecki says. “But we want to continue to support our people because that’s a huge part of our business, driving results through their efforts.”

Also high on Czarnecki’s list of priorities is cultivating stronger ties to investors who are relatively new to Broadstone. The company, he says, has forged strong ties with many of its pre-IPO investors, but has more work to do when it comes to reaching out to newcomers.

“Connectivity and building relationships with shareholders are critical and will be super important once we’re able to make the rounds [in person] again,” Czarnecki says.

Suggested Results

Off

Magazine Issue

March-April

Magazine Issue Year

2021

How the REIT Industry is Building Diversity

Kyle Gustafson — Tue, 02 Feb 2021 00:54:52 +0000

How the REIT Industry is Building Diversity Kyle Gustafson Feb. 1 2021

Anna Robaton

publications@nareit.com

Anna Robaton is a freelance writer and regular contributor to REIT magazine.

The REIT industry has committed to making meaningful strides on diversity, equity, and inclusion across its ranks.

Building Diversity

The REIT industry has committed to making meaningful strides on diversity, equity, and inclusion across its ranks.

Among the many things 2020 will be remembered for is a national reckoning on race and social justice that is driving change on a number of fronts, including the commercial real estate sector.

By building upon existing efforts and launching new initiatives to promote diversity, equity, and inclusion within the REIT industry, Nareit and its membership are working to ensure that the momentum sparked in 2020 generates measurable and substantive change in the years ahead.

Even before the killing of George Floyd by police last summer fueled nationwide protests and public condemnations of systemic racism, Nareit and REITs had stepped up efforts to address social issues. Set against the backdrop of a pandemic that disproportionately impacted people of color, the events of 2020 only underscored the importance of those efforts and created a greater sense of urgency.

“I think there is a huge opportunity” to create lasting change, says Thomas Baltimore Jr., chairman, president, and CEO of Park Hotels & Resorts Inc. (NYSE: PK).

“I do not believe this is a passing fad, but a real opportunity for companies, including Park, to evaluate and upgrade their employment practices [regarding] recruiting, training, promotion, mentoring, and sponsorship,” adds Baltimore, who is part of a diverse executive management team at Park.

Together with Debra A. Cafaro, chairman and CEO of Ventas, Inc. (NYSE: VTR) and A. William Stein, CEO of Digital Realty (NYSE: DLR), Baltimore co-chairs Nareit’s new Dividends Through Diversity, Equity & Inclusion (DDEI) CEO Council.

“I do not believe this is a passing fad, but a real opportunity for companies, including Park, to evaluate and upgrade their employment practices [regarding] recruiting, training, promotion, mentoring, and sponsorship.” - Thomas Baltimore Jr., Chairman, President and CEO, Park Hotels & Resorts Inc.

Made up of 30 REIT CEOs, the council is leading the REIT industry’s efforts to advance actionable and sustainable plans that support the recruitment, inclusion, development, and advancement of women, professionals of color, and members of other underrepresented groups.

“The mission of the DDEI CEO Council is to address—at the highest level—the key issues and opportunities related to diversity, equity, and inclusion in the REIT and publicly traded real estate industry,” Stein explains. The council, he adds, “will provide Nareit’s leadership with recommendations to help further the association’s and the industry’s progress in this crucial area.”

A New Lens

The council was formed last November, the same month that Nareit tapped Nathaalie Carey, former COO at New York state’s Department of Labor, to serve as its new SVP for industry affairs and social responsibility. Carey is not only a former high-ranking New York state official but also served on Gov. Andrew Cuomo’s NYS Women’s Pay Equity Panel.

Now a member of Nareit’s senior leadership team, she is responsible for several key priorities, including the social elements of environmental, social, and governance (ESG) policies in the REIT community.

To advance diversity, equity, and inclusion, she’s working closely with Nareit President and CEO Steve Wechsler and founding members of the DDEI CEO Council to develop initiatives aimed at driving sustainable change. Nareit’s newly-formed Social Responsibility Council, meanwhile, is tasked with figuring out how those initiatives can be scaled across the REIT industry.

“There are so many different opportunities right now that go beyond the traditional philanthropic endeavors that many of these organizations already undertake,” Carey says, noting that she was drawn to her role at Nareit largely for the opportunity to make a difference in an industry with global impact.

Among other priorities, Carey hopes to help members of the commercial real estate community see diversity, equity, and inclusion through a new lens.

“We have to think about diversity of thought, educational background, and experience. Normally, you get diversity from looking around the table and seeing who’s missing,” whether it’s people of color, women, members of the LGBTQ community, people with disabilities, or other underrepresented groups, she explains.

Companies, she adds, may need to consider not just who’s seated around the proverbial break room table but around the boardroom table as well. Companies that need and/or want to do more when it comes to diversity and inclusion can start by reexamining their hiring and promotional practices and existing partnerships with executive search firms, Carey notes.

“There are issues to consider in terms of your organizational structure and setup if you want to make a difference,” she explains. “If you have a chief diversity officer, for instance, ask yourself what power does that person have? Is there someone who is looking unilaterally at your hiring practices and making decisions on the organization’s behalf if they see trends that may have negative impacts on any particular group of people?”

Raising the Stakes

Even REITs that have led the way on diversity and inclusion are pushing themselves harder in the wake of last summer’s civil unrest.

Consider Alexander & Baldwin, Inc. (NYSE: ALEX) (A&B), Hawaii’s largest owner of grocery-anchored neighborhood shopping centers and the silver recipient of Nareit’s 2020 Diversity, Equity & Inclusion Recognition Award. Many of A&B’s employees are women. What’s more, its workforce is already racially diverse, largely because of the demographic makeup of the state in which it operates, according to President and CEO Chris Benjamin. Hawaii is home to the nation’s largest share of multiracial Americans, according to the Pew Research Center. Only about 25% of its population is white, according to the Census Bureau.

“We’re examining everything from the holidays we celebrate, to the way we recruit, to the charities we support.” – Chris Benjamin, President and CEO, Alexander & Baldwin, Inc.

Despite the existing diversity at A&B, the company isn’t resting on its laurels, says Benjamin, a member of Nareit’s DDEI CEO Council. “We’re a 150-year-old company that’s willing to reevaluate and redefine how we do things. We’re not stuck in our ways, and we’re not hiding from our past,” he notes.

Under Benjamin, A&B is going beyond what he calls superficial measures of diversity and exploring questions such as: “What about diversity in our senior management ranks? What may be keeping women from advancing to those ranks? Do we have native Hawaiians in those ranks? How many people do we employ from lower-income areas?”

“We’re examining everything from the holidays we celebrate to the way we recruit to the charities we support,” says Benjamin, noting that there is as much enthusiasm for diversity and inclusion in the company’s C-suite as there is among its millennial employees. That enthusiasm paved the way for the recent formation of such employee-led groups as A&B Pride, which supports LGBTQ employees, and a women’s leadership initiative.

“With respect to diversity and inclusion, it requires those people who have frankly suffered from discrimination to be very involved, but it also requires those of us with privilege who have benefitted from the system to not only endorse, but embrace [those efforts],” Benjamin says.

Institutionalizing Equity, Diversity & Inclusion

Many others in the commercial real estate sector appear to be coming around to the same idea. That represents a shift from several years ago when, on the whole, companies tended to take a fairly laissez-faire approach to diversity and inclusion, says Sudarshana Rangachary, SVP of human resources at Essex Property Trust Inc. (NYSE: ESS). Essex was a bronze winner in Nareit’s 2020 Diversity, Equity & Inclusion Recognition Awards.

“This industry previously had some challenges in recognizing that diversity, equity, and inclusion requires a more concerted effort,” she says. “There was a general feeling that things develop organically as long as you do the right thing.”

Essex revisited its ESG initiatives in early 2019 and, as a result, formed a diversity and inclusion committee, among other moves. The committee reviews and monitors activities and practices, including hiring practices that promote diversity, equal opportunity, and fair treatment for employees. Its chair reports to President and CEO Michael Schall, who, in turn, regularly updates the firm’s senior management team on the committee’s activities. Schall is also a member of Nareit’s DDEI CEO Council.

Rangachary says Essex’s “thoughtful, programmatic approach” to diversity, equity, and inclusion has helped the company make strides on a number of fronts. It has one of the most diverse workforces among apartment REITs and has no gender pay gap, she notes.

Despite the strides made, Rangachary says Essex has more work to do, which includes aiming to make its racial diversity mix even more reflective of the West Coast markets in which it operates. “I’m happy with where we are, but we recognize this is a journey. By no means do we think our work is done,” she says.

Pledges, Not Platitudes

Ventas, Inc. (NYSE: VTR), meanwhile, has also been on a years-long journey toward greater diversity and inclusion—not just because it’s the right thing to do but because it makes business sense, Cafaro says. Ventas received the gold award in Nareit’s 2020 Diversity, Equity & Inclusion Recognition Awards.

“I’ve always been motivated to build a great company and all the data show that diverse teams make better decisions and have better results,” she says.

“I’ve always been motivated to build a great company and all the data show that diverse teams make better decisions and have better results.” – Debra A. Cafaro, Chairman and CEO, Ventas, Inc.

Under Cafaro, in 2018 Ventas became the first REIT to join the CEO Action for Diversity & Inclusion initiative, a CEO-driven business commitment to advancing diversity and inclusion within the workplace.

Starting with its ESG materiality assessment in 2019, Ventas has set specific public goals with regards to gender and diversity on its board, within its leadership team, and across the organization. For instance, the company is striving for company-wide gender balance and 25% female representation within its leadership team by 2023.

The firm has long prioritized gender diversity at the board level. Since 2001, its board has had at least two female members, including Cafaro. Ventas’ board now has four female members, including Melody Barnes, a former White House domestic policy director and the company’s first Black director.

We’ve taken the momentum of external events [in 2020] to build more momentum and focus at all levels of our organization to do more, faster” with regard to diversity and inclusion, says Kelly Meissner, director of sustainability at Ventas.

Meissner says she’s convinced the REIT sector has reached an inflection point with regards to diversity and inclusion—just as it once did on the environmental front.

“This isn’t just issuing statements. This is [about] taking action: creating the framework and infrastructure to study and understand how we make progress on these issues as an industry,” she says.

Changing Hearts and Minds

What does it really mean to have a diverse and inclusive organization?

To create real, sustainable, cultural, and behavioral change, which is really the essence of diversity and inclusion, organizations must be authentic in their commitment. It can’t be a reactive response to a moment in time.

Having a diverse and inclusive organization means that people, regardless of who they are, have positive, engaging experiences. And this can only happen if organizations, and the people leading them, are intentional, have clear goals, and are held accountable for achieving those goals.

What kinds of discussions and/or initiatives have arisen at JBG SMITH as a result of the national reckoning on social justice matters?

Recent events have caused many companies to take a more proactive approach to demonstrating their commitment to diversity and inclusion. In some cases, it has created the burning platform that many organizations needed to think differently about the work and why it’s important.

Dawnita Wilson of JBG SMITH (NYSE: JBGS) was the individual recipient of Nareit’s 2020 Diversity, Equity & Inclusion Recognition Award. Wilson joined the REIT in 2019 as its first-ever VP of diversity and inclusion, bringing more than 15 years of relevant experience to the company.

However, I think time will tell whether corporations will extend their commitment beyond position statements and/or donations. Because as we know, changing the diverse landscape of senior ranks within organizations takes steadfast commitment and intentionality, as well as proper planning.

At JBG SMITH, we’ve definitely started having those conversations, even prior to recent events. From a cultural perspective, we focused on ways to engage with and hear from our employees. We launched our D&I Employee Roundtable Series and kicked it off with our “Black Voices” segment, which provided a platform for our Black employees to engage in dialogue and share how they were feeling about current events.

I also led multiple team discussions and dialogues around racial justice, implicit bias, and inclusive leadership to help create the safe spaces needed to step outside of our comfort zones and engage in meaningful conversations.

Additionally, we have integrated diversity and inclusion into our philanthropic efforts and have committed to supporting even more grass roots organizations, small and local businesses, as well as racial justice causes.

But for me personally, none of these actions happened as a result of a “national reckoning.” They happened because they are part of our strategy. While we may have adjusted the timing of certain aspects based on the external landscape, it’s important to emphasize that when diversity and inclusion is strategic—not simply a program or initiative—these are the types of things you should be doing anyway. And they should continue well beyond the moment.

How can REITs work to ensure that the focus on diversity and inclusion can be maintained?

It all comes down to commitment and intentionality. Focusing on diversity and inclusion beyond a moment in time means that organizations must implement changes that are sustainable and build infrastructures that will continue to yield the results that they want to see. Having a comprehensive, multi-year strategy with clear goals and measures is critical to accomplishing that.

What are the opportunities and the challenges within the commercial real estate sector for promoting greater diversity and inclusion?

Some specific opportunities include developing strategies to engage and advance diverse talent, establishing strategic partnerships to help build your brand in diverse communities, raising awareness and building diversity and inclusion competency company-wide, and ensuring that you approach everything you do with an equitable and inclusive mindset. It’s really about changing hearts and minds, which will eventually lead to changing behaviors.

But I feel the greatest opportunity continues to lie in an organization’s willingness to challenge the status quo, be intentional, and drive accountability at all levels of the organization, which again, requires solid, authentic commitment. If diversity and inclusion is truly a priority and there is explicit, genuine commitment, actions will speak far louder than words.

Suggested Results

Off

Magazine Issue

January-February

Magazine Issue Year

2021

REITs Take Steps to Increase Industry Diversity

os@interactivestrategies.com — Sun, 27 Sep 2020 17:15:00 +0000

REITs Take Steps to Increase Industry Diversity os@interactive… Sep. 27 2020

Anna Robaton

publications@nareit.com

Anna Robaton is a freelance writer and regular contributor to REIT magazine.

The commercial real estate industry must take steps now to improve racial diversity.

Deepening the Bench

The commercial real estate industry must take steps now to improve racial diversity.

REITs and commercial real estate have historically had a low percentage of Blacks and other people of color among the executive and corporate board ranks. Addressing racial diversity and inclusion has been a target of improvement for many years now, yet the killing of George Floyd in May, and the protests supporting social justice that followed, have brought those efforts into sharper focus as companies prioritize efforts to examine ways in which they can do more to address lingering inequality.

Duke Realty Corp. (NYSE: DRE), a long-time leader in corporate responsibility matters, is one example of a REIT that is committed to raising the bar both internally and across the industry. In mid-July, nearly all of its 400 employees tuned in to a companywide webcast to hear five of their Black colleagues tackle such questions as: what was it like for you growing up? what does it mean to be Black in America? what has your experience been like as a person of color in the commercial real estate industry?

Such frank conversations have rarely taken place in corporate America. The discussion at Duke Realty, hosted by the company’s long-standing diversity and inclusion council, helped many employees glimpse life through the eyes of their Black colleagues. More talks centering around the issue of diversity are planned.

“Companies such as Duke Realty, that already have extensive diversity and inclusion programs are now doing even more,” says Duke Realty CEO James Connor. Two of thirteen members of the REIT’s board of directors are Black.

“I’ve also spoken to a number of CEOs whose companies have lagged in this area. They’re scrambling to play catch-up and put programs in place. They now see that they can no longer just talk the talk. They recognize that diversity, inclusion, and racial justice are issues that strong, well-run companies are addressing proactively,” Connor says.

An Inconvenient Truth

It’s no secret that the commercial real estate sector still lags on diversity, particularly racial diversity. A recent study by CREW Network, which works to transform the industry by advancing women, confirms this. Conducted in partnership with the MIT Center for Real Estate, the study is based on a survey taken between January and April of this year. Nearly 3,000 industry professionals (including some in Canada and the U.K.) provided full responses.

Only 16% of U.S. respondents said their workplaces are “very diverse,” meaning that people of color make up at least 25% of employees. The majority of U.S. respondents (62%) said that people of color account for less than 15% of the professionals in their workplaces.

That said, more than half of all respondents said they’ve noticed a workplace culture shift on diversity. Among the biggest factors driving that shift are external pressures from the industry and mandates from CEOs and other top executives, according to the study.

The culture shift that’s underway appears to be driving change. CREW Network’s study found that the heightened focus on equity and diversity in some organizations has given rise to policies that are “more supportive of work/life balance,” bias-awareness training, and greater access to professional development opportunities, among other initiatives.

“Diversity, equity, and inclusion isn’t a passing fad,” says Christine Gorham, director of development at Caddis Healthcare Real Estate and president of CREW Network. “It’s an investment in our companies, our future, and our culture. It can no longer be just lip service. The industry has to take action.”

Making a Difference

Several REITs had begun taking a more strategic approach to diversity and inclusion even before protests erupted earlier this year. Take JBG SMITH (NYSE: JBGS), for instance. Last September, the company, which owns and develops mixed-use properties in the Washington, D.C. metro area, hired its first-ever vice president of diversity and inclusion, Dawnita Wilson.

Dawnita Wilson, vice president of diversity and inclusion, JBG SMITH

Wilson was previously director of global diversity and inclusion for Sodexo, a publicly traded food services company with more than 450,000 employees worldwide. Since joining JBG SMITH, she has developed a comprehensive, multi-year diversity and inclusion strategy and taken a deep dive into the company’s culture.

“With cultural change being such a major factor in results-driven diversity and inclusion efforts, understanding what’s contributing to or hindering your progress is critical, as is establishing relationships and building credibility,” Wilson says.

Aside from developing a strategic plan, Wilson’s first initiatives have focused on what she calls “low-hanging fruit,” or opportunities to adjust existing systems, practices, and processes to enhance diversity and inclusion.

For instance, she’s overseen changes to how and where the company recruits talent, and the new approach is already yielding results. Wilson credits a newly-formed partnership with the University of Maryland with helping JBG SMITH, based in Bethesda, Maryland, to recruit a highly diverse class of summer interns this year. More than half of the 13 college students who participated in the firm’s first-ever virtual internship program are women and people of color.

“Diversity and inclusion really just need to be part of how we do things, how we conduct business,” she explains.

Wilson has also launched a diverse, cross-functional employee group that’s helping to execute the firm’s new diversity and inclusion strategy and bring greater visibility to those efforts. As a result of the group’s work, JBG SMITH recently launched a new blog series, which is a platform for members of the firm’s executive team and other business leaders to share insights on diversity and inclusion and celebrate related achievements.

Reflecting on her reasons for joining JBG SMITH, Wilson says she was drawn to the firm by the opportunity to “build and execute a vision and strategy” for diversity and inclusion, with the strong support of the company’s senior team, and to do so in an industry where there’s plenty of opportunity to make a difference.

“It’s no secret that there is still a lot of work to be done in the real estate industry when it comes to diversity and inclusion. So, I knew I would have my work cut out for me,” she says.

Doing the Right Thing

Wilson’s point isn’t lost on the leadership team at Prologis Inc. (NYSE: PLD), which has been working for years to foster greater diversity within the company’s ranks, not just because it’s the right thing to do, but because it makes good business sense. The San Francisco-based REIT is one of world’s largest owners and developers of logistics real estate, with a portfolio spanning 19 countries. It has more than 1,700 employees.

Uzo Akotaobi, vice president of human resources and inclusion & diversity at Prologis.

“We’re a global company. Our customer base doesn’t fit one profile,” says Uzo Akotaobi, vice president of human resources and inclusion & diversity. “Diversity within our ranks brings different perspectives and experiences to the table, enabling us to solve the problems of a complex, interconnected world,” he says.

Among other initiatives, Prologis has reexamined its approach to recruiting, training, mentoring and promoting talent in recent years, and made changes designed to foster a more inclusive and diverse culture — in that order.

“We have the ‘I’ before the ‘D’ intentionally as inclusion is about creating a culture where everyone can succeed, not where any one group feels marginalized and they have to show up differently at work in order to succeed,” says Colleen McKeown, the firm’s chief human resources officer.

To recruit larger numbers of minorities, Prologis has begun casting a wider net among colleges, as it also continues to provide scholarships through the Urban Land Institute, and directly at universities. It’s looking beyond the usual suspects with real estate programs to highly-ranked institutions like Georgia Tech, which has a highly diverse student body. The firm is also working to raise its profile outside the insular world of industrial real estate by participating in a wide variety of community events, such as Denver’s annual Startup Week.

“We develop relationships with organizations that have reach into communities that may not be aware of the opportunities in real estate. We want to introduce this great organization and industry to different communities,” says Akotaobi, who happens to be relatively new to commercial real estate himself. He joined Prologis in September 2018 and has since worked closely with McKeown to build on existing company efforts to promote inclusion and diversity.

“We have a CEO [Hamid Moghadam] who totally gets it and fully supports it,” says McKeown, referring to Moghadam’s willingness to look beyond the industrial real estate sector for talent. “The easy button is, metaphorically, to hire yourself, but it’s the short-term answer. We look for people [from diverse backgrounds] and set them up for success,” she adds.

Grooming New Leaders

Last fall, Prologis launched a program designed to foster greater diversity within its leadership ranks. The High Potential Employees (HiPE) program exposes participants to key areas of commercial real estate. Prologis seeks diverse candidates for the program, although they must have a science, technology, engineering, and math (STEM) degree.

Participants are mentored and trained by the company’s subject matter experts in construction, leasing, property management, capital deployment, and valuation. They’re also taught leadership skills. Associates who graduate from the program are hired for leadership roles throughout Prologis. The inaugural HiPE class was a diverse set of people that included people of color and women and individuals with veteran status.

“We tell leaders within our company: ‘Hire for what you cannot teach.’ We teach real estate very well. So, we hire a diverse group of people and leverage their differences and strengths,” Akotaobi explains. “It’s about culture add, as opposed to culture fit.”

Given Prologis’ deep commitment to diversity, it’s not surprising that it was among the companies that took a public stand this summer in support of the protests for racial justice. But Prologis didn’t just issue a solidarity statement, it also committed $1 million to support organizations on the front lines of the fight against systemic racism.

Scholarships, Mentoring, and More

Like Prologis, Duke Realty has rolled out programs in recent years that have fostered greater diversity within its ranks, including a partnership with Chicago’s Roosevelt University that has enhanced recruiting efforts.

In 2016, the company launched the Duke Realty Fund for Education and Advancement of Minorities in Real Estate (DREAM) at Roosevelt University. Each year, the DREAM program provides $5,000 scholarships for two years to four students working toward master’s degrees in real estate. Duke Realty executives mentor scholarship recipients and give them first notice of open positions at the firm.

Four years ago, the company also unveiled an executive mentoring program that has proven highly effective at creating more professional development opportunities for women and people of color, and improved hiring and retention rates for minority groups at mid- and senior-level positions.

How have such programs helped to move the needle at Duke Realty? Over the last nine years, the company’s minority headcount has risen to 13% from less than 10%. Women now make up 46% of its workforce, up from less than 40% nine years ago. Last year alone, 67% of the candidates hired for mid- and top-level positions were either women or people of color. What’s more, of the 55 promotions awarded last year, nearly half went to women and 18% went to members of minority groups.

An Evolving Playbook

Clearly, the playbook for fostering diversity and inclusion continues to evolve as real estate organizations fine tune existing efforts and experiment with new approaches. As McKeown of Prologis notes, working toward greater diversity is an iterative process—one that should be based on regular feedback from employees.

“Companies really need to listen to their employees,” she advises. “Find a way to get feedback and figure out what’s working. If something’s not working, then pivot. It’s a journey.”

Sources of Talent

Cedric Bobo, a former investment banker, has long believed that where you’re born shouldn’t determine where you end up. That belief helped him rise to the pinnacles of Wall Street during the first phase of his career and later to co-found Project Destined, a social impact platform that strives to help underserved students become stakeholders in their communities.

Cedric Bobo, co-founder of Project Destined

Bobo launched Project Destined in Detroit in 2016. Later, he set his sights on the Bronx at the urging of two of his nonprofit’s earliest supporters, former New York Yankees star Alex Rodriguez and his wife, Jennifer Lopez, a Bronx native.

Shortly after Project Destined began working in the Bronx, Brookfield Properties unveiled its plans to make its first-ever investment in the borough, a $950 million, mixed-use development along the waterfront in the Mott Haven neighborhood. A partnership between the fledgling nonprofit and one of the world’s largest real estate managers ensued.

“We knew we were going to be a new neighbor in the Bronx and wanted to make sure we were learning from the students who live in the neighborhood and will drive change,” says Charlie Howe, a senior associate at Brookfield who’s helping to oversee the company’s project in the Bronx, called Bankside.

Project Destined and Brookfield kicked off their partnership with a boot camp-style real estate education and mentoring program for 60 high school and college students from the Bronx. The students took intensive courses on the fundamentals of real estate, taught by Project Destined mentors and 25 Brookfield professionals who volunteered their time.

Later, the students were placed on teams that developed business ideas with input from Brookfield volunteers. The teams then pitched their ideas—including proposals for hotel and retail space adjacent to Bankside—to panels of judges comprised of Brookfield volunteers and other real estate practitioners, as well as business school students.

The program culminated in a Shark Tank-style contest at the National Basketball Association’s headquarters in Manhattan. The teams of students pitched their ideas to a panel of judges that included Brookfield Property Group Chairman Ric Clark, Alex Rodriguez, Bronx Borough President Ruben Diaz, and NBA Deputy Commissioner Mark Tatum. The winning team split a $10,000 prize.

A Project Destined Bronx competition in Spring 2019.

“The program was a cool way to leverage what our professionals do at Brookfield every day into a learning opportunity for the students, who got first-hand insight into what the industry is all about,” Howe says.

Bobo says the purpose of his nonprofit isn’t simply to teach students the proverbial nuts and bolts of real estate. It also aims to help students from underserved communities see themselves in a different light and cultivate professional connections in the world of real estate.

“I emphasize education and ownership because you think of yourself differently in this world when you project yourself as an owner in your community,” Bobo says.,

Just as importantly, his nonprofit aims to get major real estate companies to view urban markets, like the Bronx, as sources of talent, he says.

“What we’re creating is the same kind of appreciation for talent in urban markets that happens on the basketball courts and sports fields across urban America. These students are being treated like the talent that they really are,” he explains.

Brookfield and Project Destined continue to work together in the Bronx and have also partnered on programs in Los Angeles, Baltimore, and Nashville. This summer, Project Destined launched a virtual internship program on real estate digital marketing with the support of Brookfield and other firms. Brookfield has also hired several of the now-former students who participated in its inaugural program with Project Destined.

Morningstar’s Minority Empowerment Index

The Morningstar Minority Empowerment Index provides exposure to U.S. companies that stand out for their commitment to racial and ethnic diversity. Currently, 11 REITs are included in the index. Commitment is measured through policies, programs, and performance, as well as societal impact. Companies are judged not only on the basis of their own workforces and boards of directors, but also on their supply chains and community interaction.

The REITs currently included in the index are (in order of weighting as of June 30): Prologis, Inc.; Equinix, Inc.; AvalonBay Communities, Inc.; Welltower Inc.; Equity Residential; Weyerhaeuser Co.; Healthpeak Properties, Inc.; Ventas, Inc.; Iron Mountain Inc.; Kilroy Realty Corp.; and, SL Green Realty Corp.

Read more from September/October issue of REIT magazine, available now in an interactive PDF.

Suggested Results

Off