Public Service
Unconventional Partnerships: Empowering Real Estate Developers
2024-12-04
Global real estate development, a field that has always been intricate, has witnessed an even greater level of complexity in recent years. The concept of "building green," which was once a choice and a differentiator for developers, is now increasingly the only viable path to meet new regulations, consumer preferences, and investor expectations. New technologies, many of which are powered by recent advancements in AI and generative AI (gen AI), present significant opportunities but also demand in-depth knowledge.

Unlock the Potential of Unconventional Real Estate Partnerships

Section 1: The Changing Landscape of Global Real Estate

In recent times, global real estate development has undergone a significant transformation. Building green, which was once a niche concept, has now become a necessity. New regulations, evolving consumer preferences, and the expectations of investors have all contributed to this shift. For instance, a study conducted by McKinsey revealed that nearly three-quarters of large global real estate companies' chief investment officers identified high interest rates as a major challenge. Fluctuations in costs and supply chain issues also pose significant problems. These difficulties have led real estate developers to explore broader and deeper partnerships.In 2022, approximately 30% of real estate partnerships involved alliances, joint ventures (JVs), and mergers and acquisitions (M&A) with noncore industry partners such as hospitality or environmental services. This is a significant increase from around 20% in 2013. Developers are realizing that they need to integrate sophisticated technology, including machine learning, and provide a high standard of customer experience. Deeper partnerships with diverse companies and industries can help them achieve these goals.

Section 2: Unconventional Partnerships in Real Estate

Unconventional partnerships in real estate are innovative and nontraditional collaborations that go beyond the traditional developer-contractor relationship. Instead of simply hiring a service provider or buying products, developers enter into more sophisticated cooperation mechanisms such as alliances, JVs, and acquisitions. These partnerships enable cross-industry collaboration and vertical and horizontal integration.For example, a megacity formed a JV with a sustainable waste management company. This partnership helped the megacity access tailored solutions, enhance its sustainability reputation, and overcome supply chain problems. Another case is a European developer's JV with a clean-energy producer. This collaboration enabled the developer to increase renewable energy production by more than 200% over two years and attract sustainability-conscious investors.Unconventional partnerships offer several benefits. They allow developers to invest in new technologies and solutions, attract a wider pool of investors, and gain capabilities and expertise that expand the traditional definition of what a developer does.

Section 3: Case Studies of Unconventional Partnerships

A European developer announced a JV with a clean-energy producer to expand solar-power production on its properties. By doing so, the developer was able to produce approximately ten million kilowatt-hours (kWh) of electricity per year and save roughly four million metric tons of CO2 equivalent. This was more cost-effective than seeking to produce clean energy independently through contracted suppliers.A megaproject invested in an automotive start-up and formed a JV. This allowed the developer to build in-house capabilities and access new revenue streams. It also had a positive impact on the local economy by creating jobs locally instead of in another country.A North African megacity developer formed a JV with a sustainable waste management company. This partnership helped the megacity achieve an 80% landfill waste diversion rate and gain a competitive advantage in securing materials and services during supply chain problems. It also enhanced the developer's reputation and attracted sustainability-conscious investors.A North American real estate developer invested in an equity alliance with a security tech start-up. This partnership enabled the developer to customize the start-up's software and gain a competitive edge in security innovation. It also helped develop in-house capabilities and attract a new class of investors.

Section 4: Steps to Successful Unconventional Real Estate Partnerships

Conduct Specialized Due Diligence: Unconventional partnerships involve new business models and unfamiliar risks. It is crucial to conduct a tech infrastructure assessment, evaluate cybersecurity protocols, and conduct IP rights audits to ensure the partnership's success.Determine the Partnership Type: Real estate developers need to select the appropriate deal type based on their strategic directions and risk appetite. Acquisitions, JVs, and strategic alliances are the most common mechanisms.Define, Review, and Adapt Shared Objectives: Clear and aligned objectives are essential in unconventional partnerships. As AI and gen AI become more powerful, developers need to seek out partners to rewire their companies for the digital era. Well-defined goals based on common objectives and values are crucial.Develop a Strong Governance Model: Effective governance is crucial to the success and longevity of partnerships. This includes establishing a management team, recognizing and bridging cultural differences, and managing risks.Establish Performance Metrics and Exit Strategies: Partnership agreements should include performance metrics to assess progress and exit strategies in case of dissolution. Planning for leadership succession is also important.Unconventional partnerships can help real estate developers build capabilities and expertise in areas such as sustainability and technology. They can also help pursue near-term goals and evolve into future-proof developers.
The State's New Behavioral Health Center Faces Cost Overrun
2024-12-04
Sign up today for First Watch and embark on a journey of understanding Oklahoma better. Let Ted Streuli be your guide as we delve beyond the surface of daily news. The state's new behavioral health center in central Oklahoma is facing significant challenges, with a massive cost overrun due to unforeseen factors. This article explores the details and implications of this situation.

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Cost Overrun at the Donahue Behavioral Health Center

The Donahue Behavioral Health Center in Oklahoma City is encountering a substantial cost overrun. The initial estimate of $150 million did not include furniture, equipment, and the need to redesign bathrooms from hallways to individual rooms. This has led to a request for an additional $125 million to complete the project. Lawmakers and state officials broke ground in March with the expectation of completion by 2026, but now it may be pushed back to 2028. Multiple factors such as inflation have contributed to the higher costs. In 2022, when lawmakers vetted the project, they anticipated making $50 million from the sale of land at the aging Griffin Memorial Hospital in Norman. However, that has now dropped to $10 million due to soft demand and possible building remediation costs. Former leaders at the agency failed to include these costs in the initial project estimates. Mental Health Commissioner Allie Friesen took over in January and is now dealing with these challenges.

The original design had bathrooms in hallways, which raised concerns about certification. The agency's new leaders worried that if bathrooms were not in patient rooms, the facility might not meet certification requirements. Safety concerns and additional costs are associated with moving patients from their rooms to hallways and back. Agencies had to submit their budget requests by Oct. 1, and the updated information has been submitted to legislators. Friesen alerted lawmakers of a possible shortfall in May, and discussions continued throughout the summer. The Legislature committed $87 million in federal pandemic relief funds in 2022, with the rest of the funding coming from the sale of Griffin land. The 200,000-square-foot Donahue Center is set to replace the 1890s-era Griffin, which is the state's largest behavioral health hospital. The bed count may be slightly reduced due to the need for bathrooms in patient rooms.

Oklahoma Watch's Role and Donation Appeal

Oklahoma Watch plays a crucial role in providing unbiased reporting and protecting free speech. By donating to Oklahoma Watch, you contribute to ensuring accountability and promoting transparency. In an era of misinformation, their investigative journalism empowers Oklahomans with fact-based stories. Sign up for Oklahoma Watch Newsletters to get daily and weekly insights, including deeper context on Oklahoma news, crucial education updates, and important democracy observations, along with local photography highlights.

Every day, Oklahoma Watch strives to produce journalism that matters. This work is essential for a better-informed community and a healthy democracy. However, it is only possible with your support. Donate now to help continue this important work.

Ongoing Discussions and Future Plans

Speaker-Elect Kyle Hilbert stated that discussions about the shortfall are ongoing. Increasing mental health capacity in the state is a priority for the House, and they are working with the Senate and the Department of Mental Health to understand the needs and find ways to meet them. They have publicly discussed the known funding gap and are working within the constraints of the available funding. With the delay in opening Donahue, Hall expects the Department of Mental Health to continue using Griffin in Norman. Temporary private treatment beds may also be needed. Hall emphasized the need to be responsive to the need but cannot make a decision to fill the funding gap without going through the legislative process.

Paul Monies, a reporter with Oklahoma Watch since 2017, covers state agencies and public health. You can contact him at (571) 319-3289 or pmonies@oklahomawatch.org. Follow him on Twitter @pmonies.

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Rocket Firm Halts Highlands Spaceport Construction
2024-12-04
From reproductive rights to climate change and Big Tech, The Independent is dedicated to bringing you the latest stories as they unfold. Whether it's delving into the financials of Elon Musk's pro-Trump PAC or producing their latest documentary, 'The A Word', which highlights the American women fighting for reproductive rights, they understand the significance of separating facts from messaging. In this critical moment in US history, your donation enables them to keep sending journalists to cover both sides of the story. The Independent is trusted by Americans across the political spectrum and, unlike many other quality news outlets, they choose not to restrict access with paywalls, believing that quality journalism should be accessible to all.

Your Donation: The Key to Quality Journalism

Reproductive Rights and Beyond

The Independent is on the front lines when it comes to important issues like reproductive rights. Their latest documentary, 'The A Word', shines a light on the American women who are courageously fighting for these rights. By providing in-depth coverage and analysis, they help to raise awareness and drive change. It's not just about reporting the news; it's about making a difference.

Reproductive rights are a fundamental part of women's lives, and The Independent is committed to ensuring that these rights are protected. Through their reporting, they give a voice to those who are often marginalized and help to shape public opinion. Their work is essential in the fight for equality and justice.

Climate Change and the Independent

The Independent is also at the forefront of reporting on climate change. They understand the urgency of the situation and are dedicated to providing accurate and timely information. From covering the latest scientific research to highlighting the impact of climate change on communities around the world, they are making a significant contribution to the fight against climate change.

Climate change is one of the greatest challenges facing our planet, and The Independent is playing a crucial role in raising awareness and driving action. Their reporting helps to inform the public and policymakers, and they are working towards a more sustainable future for all.

Big Tech and the Independent

The Independent is not afraid to take on Big Tech and hold them accountable. They have been investigating the financials of Elon Musk's pro-Trump PAC and exposing the power and influence of these tech giants. Through their reporting, they are shining a light on the issues that matter and helping to ensure that Big Tech is held to account.

Big Tech has a significant impact on our lives, and The Independent is committed to ensuring that they are operating in a transparent and ethical manner. Their reporting helps to expose the flaws and injustices within the tech industry and promotes a more level playing field. They are working towards a more equitable and sustainable future.

Orbex and the Scottish Spaceport

A Scottish rocket company, Orbex, has paused plans to build a spaceport in the Highlands. They have shifted their focus from building the site in Sutherland to developing small and medium-sized rockets. Now, they aim to launch their first rockets from the SaxaVord Spaceport in Shetland.

This decision will help Orbex reach its first launch in 2025 and provide SaxaVord with another customer to strengthen its commercial proposition. The move will also allow Orbex to focus on its core mission of producing rockets and developing launch services. It's a win-win for the UK and Scottish space industries.

Initial construction in the area began last year after Orbex was granted planning permission in 2020. The company will consult its three staff employed at the site to identify options for relocation or new roles. They are committed to the north of Scotland and look forward to building their presence at SaxaVord in Shetland.

Orbex's Manufacturing Capability

Orbex is planning to increase its manufacturing capability in Forres to meet the demand for its smaller vehicle Prime. The site will also be used to develop new medium-launch vehicles that will enable them to put more satellites into orbit.

This expansion will help Orbex meet the growing demand for their launch services and contribute to the development of the UK and Scottish space industries. By focusing on manufacturing and innovation, they are positioning themselves as a leader in the space industry.

Mr. Chambers, Orbex's chief executive officer, is grateful for the support of the Sutherland community and looks forward to building their presence in Shetland. The decision to pause construction was not taken lightly, but it is a necessary step in their growth and development.

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