Bill Hankowsky, chairman and CEO of Liberty Property Trust, pointed out that both Cira Centre and Comcast Center--the two newest office towers to emerge--are not only well leased, but have also brought in new office tenants. "Yet, we're not where we were in 2000," he added, indicating there's room for improvement. Dan Dilella of BPG Properties said there was not enough growth in the city for his company.

Residential is "white hot," according to Carl Dranoff, president of Dranoff Properties. He believes residential growth will continue even if interest rates move up. Jeff Algatt, regional manager of Marcus & Millichap, agreed and also suggested that the city's 24/7, live, work environment can be expected to help attract more employers.

Even David Binswanger, president of Binswanger, who said, "I'm usually a contrarian," and acknowledged he was worried a year ago, joined the chorus. "New people are coming to the city, and there are more private equity firms coming in than ever before. We have the growth industries." He was referring to healthcare, education and life sciences.

All agreed to varying degrees, however, that the city's wage tax and business privilege tax are a hindrance to attracting new business. In addition to their actual financial penalty comes their harm to the city's image among companies. The panelists also expressed a need for better leadership.

Two potential candidates for mayoral leadership, city councilman Michael Nutter and former city controller Jonathan Saidel, discussed the need for tax and ethics reform. "Tax incentives now go out individually," Nutter said, "and they should be flat, not specialized by location." Noting that bills for tax reform have been introduced, and shot down, every year for four years, he also said, a bill to change the way that [development] contracts are won was introduced this February and could lead to a board of ethics for all city government.

"The city is a $3.8-billion corporation," Saidel said, "and a leader is expected to deliver return so that all the young people who come here to get a great education will stay here. We ought to make the whole city a Keystone Opportunity Zone. No one should have to make a campaign contribution to get the attention of government. There is a cost to pay and play, and it's not just financial but a cost to how we are perceived by potential new businesses."

Two additional drawbacks to continued growth emerged during other RealShare panels. Paul Levy, executive director of Center City District, said increased investment in playgrounds, parks and schools is needed to keep young people here once they have children. Craig Guers, SVP and general manager of Opus East, said the Central Pennsylvania industrial corridor is under threat by a rising cost of land that makes it difficult for developers to maintain satisfactory rent levels. Land costs in the Lehigh Valley, while also rising, are about half the price of Central Pennsylvania, he added, so rents can remain lower.

When Michael Desiato, editor-in-chief of Real Estate Forum, delved inside the real estate mind of Michael O'Neill, chairman of Preferred Real Estate Investments, O'Neill revealed that four months ago, he and his brother, Brian O'Neill, "had very serious discussions about joining forces again." Once partners, the brothers split in the early 1990s. Brian heads O'Neill Properties. They decided against partnering. "Brian is a tech fund," O'Neill said, "and I'm a hedge fund."

RealShare Philadelphia is sponsored by Real Estate Media, publisher of Real Estate Forum, GlobeSt.com and other print and web-based publications. Attendance at this year's event exceeded 650, surpassing last year's record-breaking attendance. Jonathan Schein, president and CEO of Real Estate Media, said RealShare Philadelphia is the company's largest RealShare conference in the Northeast.

Instant Insights /

RealShare EXCLUSIVE: Experts Call for Tax Reform, Leadership to Sustain Momentum

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