The so-called silly season is in full swing in the nation's capital as preliminary campaigns get underway for the 2016 presidential election. It's a time where "partisans can dream and pundits can speculate wildly," as one Capitol Hill rag put it-and NMHC's Board of Directors and Advisory Committee members got a taste of the fun last week when they gathered in Washington, D.C. for the annual fall meeting. (Check out the video here.)
True to form, this year's fall meeting had a heavy focus on the legislative and regulatory issues facing the apartment industry. Congressman Joe Crowley (D-N.Y.) addressed the crowd Wednesday evening before members gathered to collectively watch the second GOP presidential candidate debate.
Meeting attendees also heard from Robert Diamond, special assistant to the President and director of private sector engagement, and a host of lawmakers during a lunch on Thursday at the Dirksen Senate Office Building. Visiting lawmakers included Congresswoman Marsha Blackburn (R-Tenn.); Senator Roy Blunt (R-Mo.); Senator Johnny Isakson (R-Ga.); Senator Gary Peters (D-Mich.); Senator Jeanne Shaheen (D-N.H.); Senator Jon Tester (D-Mont.); and Senate Majority Leader Mitch McConnell (R-Ky.)
Hot topics of discussion included tax reform, the future of certain tax extenders, energy policy, cybersecurity and regulatory overreach, to name a few. Lawmakers also discussed some of the underlying issues perpetuating the polarized political system and legislative gridlock that could lead to another government shutdown this fall.
"The chances of this Congress doing tax reform with this president is zero," McConnell told NMHC members.
Similarly, the long-term fate of government-sponsored, mortgage giants Fannie Mae and Freddie Freddie Mac remains somewhat in limbo as lawmakers fundamentally disagree on the role of government in the overall mortgage market. In the meantime, the two entities continue to operate in conservatorship with more than $5 trillion in mortgage-backed securities outstanding.
In an interview with NMHC President Doug Bibby, Bethany McLean, author of the newly released Shaky Ground: The Strange Saga of the U.S. Mortgage Giants, dug into the complicated history of the two entities, their unraveling and their seemingly uncertain future. When asked what she thought would ultimately happen to Fannie and Freddie, she said, "I worry that nothing is going to happen. During the last election, the lawmakers said the problem was Fannie and Freddie, and now, they just don't talk about it."
With Congress's ability to move forward with meaningful legislative action seemingly hamstrung until the 2016 presidential election, the if-nothing-but-wild ride that is leading to the selection of the Democratic and Republican candidates is capturing the attention and imagination of those on Capitol Hill.
Celinda Lake, president of Lake Research Partners, and Kellyanne Conway, founder and president of The Polling Company, Inc./WomanTrend-two pollsters from opposite sides of the aisle-were on tap to provide NMHC members their takes on how today's pre-election grandstanding is actually going to shakeout.
NMHC staff also briefed attendees on a wide spectrum of emerging legislative and regulatory issues, including new like-kind exchange and tax depreciation studies, the EPA's controversial Waters of the U.S. rule, post-recession banking regulations governing liquidity coverage ratios and high volatility commercial real estate loans and the Supreme Court's recent ruling on disparate impact under the Fair Housing Act.
While the practical ramifications of the ruling for the apartment industry are still TBD, the case is also noteworthy in that it was one of a slate of landmark cases-to include those on marriage equality and healthcare-on which the Supreme Court recently ruled. Given the historic nature of these decisions, Nina Totenberg, legal affairs correspondent for National Public Radio, offered members insight into the personalities and motivations of the justices, sharing unique and often colorful anecdotes during a general session on Wednesday.
But for all the focus on government affairs and advocacy efforts, Wall Street's interests were hardly eclipsed by Washington's. The fall meeting also offered NMHC members a pulse check on the health of the multifamily market and the capital trends and investment opportunities underpinning it.
"We're still underhoused, believe it or not," said Kim Betancourt, director of economics and multifamily market research at Fannie Mae, during a session on the market outlook.
(Read "Multifamily Growth Set to Hold Steady.")
There may be more room to grow, but with asset values above prior peaks and future rent growth expected to fall off its recent pace of escalation, capital sources and investors of all stripes are reevaluating where and how they find value in their deals.
NMHC's Emerging Leaders tackled this question both during an investment opportunities panel discussion with six young investment sales professionals from across the country and at its Speakers Series networking event on Wednesday night, which featured Dan Miller, co-founder and CEO of Fundrise, a real estate crowdsourcing platform, and Martin Ditto, president and CEO of Ditto Residential, a D.C.-area developer.
NMHC thanks all attendees, speakers and sponsors for contributing to another successful event. Meeting presentations are available here and photos from the event are also available on our Flickr page.