SAN FRANCISCO—“There is unlimited opportunity for all of us tobe out there and be successful, but there is a lot of risk too.”That is according to RealShare Bay Area Town Hall moderatorBill Cumbelich, EVP with CBRE anda founder and principal of the CAC Group.

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More than 200 were in attendance at the RealShare ConferenceSeries event, which is produced by ALM's Real Estate Media Group,which also publishes Real EstateForum and GlobeSt.com.To kick things off, Cumbelichsaid that the Bay Area is doing great, is hot, and that the privatesector is doing its job in terms of building and growing. “Today isfar and away the most exciting and most challenging time I haveever seen,” he said. But he noted that “We are in uncharteredwaters in terms of where we go from here.” Some of the biggestissues we are facing the region have to do with infrastructure andtraffic, he noted.

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Panelist Mary Erchul, president of theAmerican Council of Engineering Cos. ofCalifornia, agreed that infrastructure is one of thebiggest things facing California today. “We are looking at thingslike water shortage and funding in general for transportation,” shesaid. “We have a lack of funding.”

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To help the situation, she explained, “we have to look atinnovation and better ways to do what we are doing and wrapped intothat is streamlining.” The outlook as far as traffic is, she said,is to “work together in our industry to come to more technicalsolutions.”

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Erchul talked about BART looking at the efficiency andsustainability of the BART cars, as an example of taking stepsforward. “They can't go to infinity with the system they have.” Orthe Oakland connector to the airport, for example, which is in itstesting phase. “Transportation will keep up with the pace—it isonly a matter of time… It has to.”

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“The future of transportation is key to getting people to wantto live in the Bay Area,” she said. As for the funding shortage,Erchul pointed out that “we have to looking at different ways offinancing,” and “use the resources we have in California in theengineering arena and work together with public and private as faras partnership to get things moving forward.”

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Switching gears a bit, panelists chatted about the overview ofthe finance market in the area, where MichaelKlein, co-founder, COO and managing director ofPartners Capital Solutions Inc., noted that “ifyou have time today to finance or have an existing project tofinance, and you have time to get it done, you can get fantasticrates.” He added that if you had a project that has been stabilizedand can work with either CMBS or insurance company money, rates areas low as he has ever seen them and the underwriting requirementsare fairly easy, but he pointed out that the paperwork “is a lot ofwork.”

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As for new sources of capital emerging, Klein points out that itis there, but warned that “there will be disintermediating forcesgoing on that will change the way that financing is going on overthe next five years so firms like ours can raise capital moreeasily and at a lower cost,” he said. “We haven't sold our soul forFDIC insurance.”

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Switching over to the multifamily sector,Yat-Pang Au, founder and CEO of VeritasInvestments Inc., talked about the increasing presence ofincome disparity that is occurring. Approximately 80% to 90% of thehousing stock in San Francisco is rent controlled already, hepointed out. “We provide stability for those who have been here along time. For those folks who come in, they get to choose abeautiful space at the market price when they move in,” he said.“The energy should not be placed on restricting rent increases, buton building more housing as opposed to restricted rentcontrol.”

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Yat-Pang Au noted that “there is a huge vibrance of companiesthat want to be where the residents are and right now, residentswant to be in the City.” He added that never before has there beenso much traffic coming into San Francisco. “People want to live inthe urban environments.”

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When talking about making spaces attractive and relevant to thetech industry broadly on the office side, AlanWalker, VP of Swift Real Estate Partners,pointed out that within the city, a lot of what is beingincorporated are reclaimed materials, exposed ceilings, stripingdown columns to expose the steel, exposed brick and polishedconcrete. But he points out that tenants are also starting to learnwhat appeals to the eye versus what is functional. For example, hepointed to a tenant, which wanted the drop ceiling put back inafter hearing how noisy it made the office. As for outside theCity, Walker says there is more of a focus on recreation such ascourt space, BBQ, bocce ball courts, outdoor spaces built forentertaining etc.

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Natalie Dolce

Natalie Dolce, editor-in-chief of GlobeSt.com and GlobeSt. Real Estate Forum, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.