Six More '2050' Net Lease Predictions

ORLANDO—Making preditions 35 years out take a lot of gut and a lot of experience. We caught up with David Sobelman is executive vice president and managing partner of Calkain Companies, to get six more keen predictions for the net lease market in 2050. You can read the first installment of this article here.

1. Part-timers will be phased out.
"The net lease industry attracts many part time practitioners, second only to residential real estate," Sobleman says. "With brokers' hopes of being involved in a few transactions annually, by the year 2050, those without a sole focus on net lease investment sales will be phased out. In today's market, it is common for leasing companies to leverage their position with developer clients by forcing them to use their ancillary services. In the future, there will be no need to “dangle a carrot” for ignominious practices."

2. Transparency will increase dramatically.
"It's harder to be less transparent today than it was 10 years ago, and that trend will increase as information makes itself blatantly apparent," Sobleman says. "Efficient and cost effective information will be the norm as the net lease industry grows and evolves. By 2050, underwriting tools will be available at your fingertips and will be seen as compulsory."

3. Assets will become physically smaller.
"By 2050, we'll simply need less ... less office space, less warehouse space and less retail space. We'll have more people around us as the population grows," Sobelman says. "True to the adage,'less is more.'"

4. Large research firms will have less of a role.
"To the point of a higher level of transparency, net lease practitioners will no longer be as reliant on large-scale research firms, whose data may or may not be accurate, providing what will become publicly released information," Sobelman says.

5. Due diligence reduction.
"Our research systems are set up in today's net lease market to allow an investor the opportunity to study a property in a fairly short amount of time, which in most cases is 30 days or less," Sobelman says. "But, attorneys, engineers, surveyors, etc. will be so efficient in 35 years that we'll look back and laugh at how long it took to make sure a net lease investment was worthy of an ultimate purchase."

6. Brokers rule.
"Well, that may be a little biased but it's clear brokers have survived every market in the modern era," says Sobelman. "A complete abolishment of the brokerage industry is unlikely, but a change in its focus is inevitable."