Richard Juge, Broker/Owner of RE/MAX Commercial Brokers in the New Orleans suburb of Metairie, La., has become the third RE/MAX Affiliate to serve as president of the CCIM Institute.
Juge (CCIM, CIPS, SIOR) was installed Oct. 14 at the Institute's Fall Business Meeting in Honolulu. Preceding Juge at the organization's helm were Bob Behrens of RE/MAX Commercial Services in Denver (2004) and Tim Hatlestad of RE/MAX Commercial Investment in Scottsdale, Ariz. (2007).
Juge's ascension to the CCIM presidency, especially when combined with the tenures of Behrens and Hatlestad, is significant for RE/MAX Commercial, says RE/MAX International Senior Vice President Mike Reagan.
"It reinforces our position in the commercial marketplace," Reagan says. "Here we have a RE/MAX Affiliate on the national stage for the third time. It encourages every RE/MAX Commercial Practitioner to become involved in CCIM."
A RE/MAX Affiliate since 1994, Juge is a RE/MAX Lifetime Achievement Award recipient and a perennial Platinum Club member. Along with David Bickell of Indiana, Juge is an instructor for the CCIM course "CI 101: Financial Analysis for Commercial Investment Real Estate," available through RE/MAX University.
Following is a question-and-answer session with Juge.
What are your thoughts and emotions on becoming the CCIM President?
It's definitely an honor to represent such a prestigious international organization. We have members in 32 countries and we actively teach in nine. It's humbling for a guy in little old New Orleans, Louisiana.
What are your plans for the CCIM Institute during your presidency?
The seeds have been planted for a lot of great initiatives that I'll be able to take credit for in 2010. We'll roll out our completely revised educational program after having spent more than $2 million rewriting our five core courses and bringing them up to date. The contents focus on the four forces affecting commercial real estate: the real estate finance world, the market world, the user world and the investor world.
Another big push is revising the format in which we deliver our classes. We want to reduce the time it takes to complete them and have more of an online component - for instance, even when courses are taken in the classroom, students will be able to go home and take the test on their computer. I'm going to get behind that because being out of your office even for a day is a bigger challenge than it was 10 years ago.
We're also going to expand our non-designation catalog with courses related to areas such as negotiating and working with troubled assets. We'll also be adding training in green real estate Ð not so much from the standpoint of educating members on green issues, but on financial analysis. The question most people have is whether they should invest in something now when any return will be in the future, not immediate.
On the membership side, we're making the Institute more valuable for our members. In the fourth quarter of this year we'll be introducing CCIMREDEX (CCIM Real Estate Data Exchange), an amazing technology. Commercial Practitioners will need to enter property listing information only once and it will appear across a broad spectrum of local, regional, national and international Web sites. When you have any changes, such as a change in price, you'll just have to enter them once and they'll appear everywhere.
It will also integrate with top industry marketing, analytical and financial products, including our own Site To Do Business.
Is the commercial real estate market really as bad as it's being painted? Are there any positive signs?
It's a tough market, no doubt. Certain areas have been very dramatically affected by the recession: the West, Florida, certain parts of the Northeast. Some markets are down 75 to 80 percent. And that has rippled out to every market. The development arena is in really tough shape; getting projects financed and encouraging investors to have a long-term vision is tough.
Certain markets fell so hard that they have a long way to go. In other markets, New Orleans for instance, we didn't crash that hard, so the recovery is going to be easier than some of those other markets.
We could well double the nationwide transaction volume from this year to next.
Most people say commercial follows residential. We've been seeing signs in the residential market of things getting better. So we expect an uptick of commercial activity in the first half of 2010. We expect a slow, steady recovery; it's not like we'll be back where we were in 2005 by next year.
What can the CCIM Institute do to help commercial agents right now?
The two core areas in which we help our members are education and state-of-the-art technology tools. We've spent $2.5 million purchasing tech tools; no agent on an individual level could afford that.
I'm a CCIM instructor and I've been going out of my way to compliment agents who have decided to educate themselves in the last couple of years. It's an easy area to cut back on, but I'm convinced that those who honed their skills when times got tough are the ones who are going to survive. CCIM designees can take a refresher course for $225, and we offer other free or low-cost classes, including webinars. There's all kinds of great course material that can make you more money in this economy. Those who are taking classes right now are going to be prime beneficiaries when the curve turns in the next 6 to 12 months.
The U.S. first-time homebuyer tax credit has given a boost to the residential market. Is there anything the government can or should do to accomplish the same for commercial?
The two things that have had the biggest negative impact on commercial real estate are the demise of the Commercial Mortgage Backed Security market - which is virtually nonexistent today - and the pressure on banks to be more conservative in their lending.
The FDIC could influence banks to be a little more liberal in how they underwrite commercial loans. And maybe there could be something for investors along the lines of the Small Business Administration lending program. The government might insure the riskiest 5 or 10 percent and let the banks provide loans at a more typical 70 to 80 percent loan-to-value ratio.
You also hold the CIPS designation. What's the state of the international commercial market?
Two years ago, when we tracked our members' interest in the international market, it was on the rise. We saw a lot of international activity then, but as the U.S. economy has turned, many international markets have been hurt as well. People have retrenched into their own local markets.
However, I think the national walls are going to continue to crumble and we're going to see more international activity. The U.S. will continue to be a safe harbor. Foreign investment in real estate is a huge part of the influx of global currency into the U.S. It's a big part of our business, and it's not going away, although it's had a hiccup in the last 18 to 24 months.
What does your assumption of the CCIM presidency, and the fact that you're the third RE/MAX Affiliate to do so, mean for RE/MAX Commercial?
I think it speaks highly of both parties. For the CCIM Institute to be able to say we have members from one of the premier real estate networks in the world gives credibility to CCIM - and vice versa. And for RE/MAX to have three presidents, that's a hard feat. Bob Behrens and Tim Hatlestad are both friends of mine and have influenced me. There are a lot of RE/MAX Commercial brokers who are heavily involved with CCIM.
How do you see RE/MAX Commercial developing in the next few years?
I'm really excited with some of the initiatives RE/MAX Commercial is undertaking. In the last few years we've had events such as the Commercial Symposium and commercial sessions at RE/MAX International Conventions. It means a ton to us to have that opportunity.
Unlike the residential market, which is largely locally driven, commercial tends to be nationally and even internationally driven. RE/MAX Commercial is doing a good job of looking beyond national boundaries. They've done a great job with new branding tools and logos, which is helping keep us current and on the cutting edge of the market.
RE/MAX Commercial is a very strong brand. I've had Affiliates from other markets tell me that because of their RE/MAX identity, they've never had anybody question their business credentials. They've never had anybody ask, for instance, where escrow will be held because RE/MAX is such a good brand.
I'm going to try in every way I can to make sure there's a good synergy between RE/MAX and CCIM and that both networks can feed off each other and be the better for it.
Turning to another topic: How is New Orleans coming along four years after Hurricane Katrina?
Everything's in motion right now. Companies are getting bigger or smaller, or moving to higher ground. Four years later you can see a lot of infrastructure improvements. The levees are better and I feel like I live in a safer place. There's been an influx of outside people, so that's been exciting for the city.
We're the fastest-growing market in the U.S., and a few months ago we boasted the lowest unemployment rate of any major city in the country. For the first time we're able to say that New Orleans is a growing, dynamic market. A lot of investors are considering coming in here who never would have done so before.
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