Tom Kohler, Vice President and Senior Principal
Real Estate Research Consultants, Inc. (RERC), A GAI Company
I recently sat down for a Q&A session with RERC V.P. and SR. Principal Tom Kohler to discuss the company’s decisions and innovations for survival and success. RERC was acquired by GAI in January of 2012.
January 2012 — GAI acquired Real Estate Research Consultants, Inc. (RERC) of Orlando, FL to broaden our scope of services. RERC provides real estate and economic advisory consulting to public, institutional, and private clients throughout the United States, addressing complex issues on community development and real estate property holdings. With shared interests in community development, public finance, and public/private initiatives, this union of GAI and RERC formalizes and strengthens a working relationship between our two firms that started in 1990. more +
L: Good morning, Tom, and welcome to GAI Consultants.
T: It’s great to be here.
L: Let’s start with you telling me what RERC does.
T: We’re economists, planners, and strategic advisors who conduct market research feasibility studies. Our work with the public sector, for instance, often provides redevelopment strategies for urban infill development—that’s using vacant or under-used land to create a complete and sustainable community or neighborhood.
L: How long has RERC been in the Central Florida area?
T: Since the firm was formed in 1986.
L: Tell me about the founding principals and their areas of expertise.
L: What expertise does each of the principals contribute?
T: Dave Darsey has been with RERC for 20 years, working on market and financial feasibility studies. He does these for a wide variety of land uses, such as retail, office and multi-family sales or rentals. He also has experience and a strong client base in public finance, providing support to municipalities that are considering issuing revenue bonds. Dave also provides consulting services for public assembly facilities, like sports stadiums, convention facilities, and museums, for example.
L: He provides feasibility studies for these types of improvements?
T: Yes. For instance, if someone wanted to issue revenue bonds for a retail-entertainment project within a taxing district, Dave Darsey would do his best to determine whether there is a demand to support that type of endeavor, as well as estimate the revenue the project would generate to support the debt. It’s a unique field. Owen Beitsch also has some background in that area.
Owen is a Ph.D. and University of Central Florida (UCF) Professor of Urban Studies in their masters program. He’s been with RERC for 22 years and has a unique talent for creating special assessment districts, fire districts, or in Florida we have community redevelopment districts, which are subsets of the municipalities that can actually tax the developer and build infrastructure. He also does a lot of the economic strategic planning, and some incubator analysis, which has become a growing niche over the last few years, particularly with universities.
L: What is incubator analysis?
T: The concept behind a business incubator is to help emerging local companies grow and survive during startup. In Central Florida, UCF and Walt Disney have created a space where a one- or two-person startup with a specific skill set like technology, computers, or agribusiness, can “grow” a company within the incubator environment, where critical startup resources are available—mentors, venture capital, marketing, finance, and sources of information.
L: How does Owen fit into that?
T: We do a market assessment. We have worked with Orange County UCF, St. Petersburg, Hillsborough County., the University of South Florida to identify incubator potential and industry clusters in the area. You don’t just say, ”I think I want to go into microbiology” without any knowledge of the resources in that field, so we do an analysis to identify the strength (or weakness) of resources and assets in the area.
L: Tell us about your professional background, Tom.
T: Before joining RERC 10 years ago, I served as the Orlando Director of Downtown Development for 25 years, so I do a lot of strategic planning for community development and redevelopment. I’ve worked on development projects from homeless shelters to funding for symphonies and ballet productions. So, I have a really broad general perspective on community building and how the public and private sectors can interact to build community and leverage assets to create an attractive and livable environment.
L: So, why has RERC chosen to join the “GAI Family of Companies”?
T: The biggest reason is that although we have worked in 20 states, our focus has been on Central Florida. GAI’s 24 locations in the northeast, midwest, and southeast provide a platform for our talents and unique services, and the opportunity to geographically build on our client base. Also, as a small firm, recruiting young talent was limited by the range and scope of opportunity and professional growth we could offer. We feel that our association with GAI opens the door on the range of unique challenges, mobility, and variety that would appeal to young professionals.
L: You seem to have found a comfort zone with GAI.
T: Yes. In the short time that we have been here, we have had a lot of fun fielding the questions and assessing how we can add value to the mix that already exists. I’m excited about it.
L: What kind of projects has RERC been involved in?
T: Outside of Florida, Dave is currently conducting a third-party analysis in Grain Valley, Kansas, for a municipal revenue bond issue to determine if the development would produce sufficient taxes to cover the bond. We have a solid reputation with bond underwriters in the Midwest, and this is our third or fourth project in Kansas. We have also been working in Reno, Charleston, WV and Asheville, NC to determine how to leverage certain parking lots, to support a convention center, and a hotel. As subconsultant to a large engineering firm in Alabama, we are conducting a corridor analysis of an aging commercial strip to determine future market potential and adaptive reuse or redevelopment. I am continuing to assist the City of Orlando and the smaller communities of Kissimmee, New Port Richey, and Crescent City with strategies, fact analysis, and some budget modeling.
L: What would you say have been RERC’s greatest accomplishments over the years?
T: I would have to include the Orlando Naval Training Center (ONTC) conversion to the 1,000-acre Baldwin Park development. RERC was the lead consultant and I was the City’s chief negotiator. At the time of base realignment closure, ONTC was processing 17,000 recruits every two weeks, and employed 7,000-8,000. People were told that the Base Realignment and Closure Commission ordered the base closed, and they said “woe is me, what are we going to do?”
RERC was hired to do an economic analysis and overall assessment to determine what property value($) would open the door for the City’s negotiations with the Navy. We were told we were only $50,000,000 apart. With that successful accomplishment, we then played a role in selecting the developer, preparing the proposal, and negotiating the development deal. Fortunately, the developer succeeded, and the closure has been acknowledged as one of the top base closures in the United States. It was award-winning and created about a billion dollars’ worth of real estate.
L: Did you get an award?
T: We personally did not, but I think everyone else did. The developers (Congress for the New Urbanism), the home builders National Association of Home Builders , and in 2006, the U.S. Environmental Protection Agency honored Baldwin Park with one of its Phoenix Awards for Excellence in Environmental Redevelopment. Baldwin Park was recognized as the largest single-phase demolition and recycling project in history.
L: That is an amazing piece of property.
T: Yes. , The 1100 acres house about 3,200 units, 1,000,000 sq. ft. of office space, 350,000 sq. ft. of real estate, and 40-50% of it was left as open recreation and water. Community reviews were all 4 and 5-star: “Its quaint little village-like atmosphere with sprawling homes and upscale main streets remind me of my northern roots.” “What a picture perfect community with cookie cutter house-lined streets and perfectly manicured lawns.” Great location and they have so many shops and restaurants in the neighborhood.
L: How can you help private developers?
T: Our strength is in the multi-family housing area. We are talking with folks at GAI’s Pittsburgh and Charleston offices with regard to private development of student housing at the University of West Virginia…properties that are right off the campus. Dave is responding to a health care RFP to prepare a market analysis for assisted living. Health care is an area we have recently developed with several clients. Historically, properties were purchased without really thinking through where they would be at the end of the day. We partnered with GAI in this area before we became a part of the “Family.”
L: What are some of RERC’s goals now that you are A GAI Company?
T: Right now, our goals are to bring awareness to our services and how they can make a difference. We feel we can contribute to engineering, landscaping, and planning. With municipal or corporate clients, we can assist in leveraging their limited resources, especially in putting public properties to private use. GAI has more than 250 public clients, and we have many as well. We would like to bring GAI into our fold to help with landscaping design. We hope this is will be a genuinely symbiotic relationship between RERC and GAI and a future we’re all looking forward to.
Real Estate Research Consultants, Inc., A GAI Company
The GAI Building
618 E. South Street, Suite 600
Orlando, FL 32801
407.843.5635 T | www.rercinc.com
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