Not every CEO understands the value of research and that was especially the case back in 2001, when Doug Bibby became NMHC’s second President.
We’ll Continue to Be Known for Data, not Rhetoric
But Doug was. In fact, on his first day as the head of NMHC he told the team that data and facts were priorities he intended to continue. “We are not going to be known for rhetoric. We are going to be known for the quality and the integrity of our data. Because when we go talk on the Hill or we go talk to the media, it's got to be with credibility.”
With that, he set the tone for the organization that NMHC would become over the next 20 years. The results in that early investment have been enormous. They not only helped the industry become a prime investor target but also proactively face the many crises the industry faced during his tenure.
That latter achievement is not inconsequential. This is a leader whose first membership meeting took place on 9/11/2001 and whose retirement was delayed by two years because of a worldwide pandemic. And in the middle, there was the housing-driven Great Financial Crisis.
Making the Case for Apartments with Facts
Bibby’s first goal was to combat the notion that renters drive crime higher, worsen traffic, overcrowd schools and more. He took on NIMBYism with data to correct the narrative. Hint: They get better because communities need housing at all price points to thrive economically and socially.
He also used data to show that America’s housing needs were undergoing a major evolution. With married couples with children households falling more than 50% in 1960 to just 18% in 2021 , America needed new housing types and apartments were not only necessary, but desirable.
Then he said the unthinkable at the time—backed by data—there are people who could afford to buy a house, but don’t want to. They prefer the amenities and flexibility apartments offer.
Going from Defense to Offense
Having opened cracks in the conventional wisdom about apartments, Bibby wanted to go further and make a proactive case for apartments. That resulted in the industry’s first-ever PR campaign, in partnership with NAA, and, of course, it was based on data.
NMHC and NAA commissioned research to show how many apartments we needed to build each year to keep up with demand as well as data showing the economic impact apartments have on their communities, directly and indirectly. The message: communities oppose apartments at their economic peril.
Visit WeAreApartments.org for the most recent data.
The next target: the cost of cost of regulations on housing production when the country was clearly facing a housing affordability crisis. (32% of total development costs on average and up to 42% in some areas.)
He knew his approach was working when at a Senate hearing, HUD Secretary Ben Carson quoted back to him that “NMHC/NAHB’s research finds regulation adds a third to housing costs.” Yes, it does. And that’s a problem.
Creating Calm in Crises with Information
When the GFC hit, NMHC was prepared. It had the data to separate multifamily from the single-family sector’s woes. Our shared risk underwriting model and lack of overbuilding, the latter fueled in part by better, more nuanced data, meant we entered that recession with resiliency and could provide a model for housing’s future.
And then the ultimate challenge came—COVID 19 and a sudden shutdown of the economy that put rental housing providers on the front line. NMHC’s culture of embracing e of data led Vice Presidents Caitlin Sugrue Walter (Research) and Sarah Yaussi (Communications) to suggest the idea of a Rent Payment Tracker. It would require an unprecedented collaboration of the major property management software providers, but they weren’t daunted.
As Doug noted, “I didn’t ask them to do this. They felt empowered…It’s a shining example of one of the greatest moments for the organization.”
It’s In His DNA, Thanks to Mentors
One could say that Doug brought an appreciation of data to his NMHC role from his prior experience at Fannie Mae. It was there that he met an original early industry innovator, Larry Dale, who helped create the secondary market for multifamily when the Tax Act of 1986 shut down the tax incentives that had been driving multifamily investment.
Dale created Fannie’s DUS (Delegated Underwriting and Servicing) lending platform out of whole cloth. It brought investors in and established credibility and standards in the industry and ultimately led to Freddie’s secondary platform and then the CMBS and REIT sectors.
“When we write the history of the modern multifamily industry, his name will be there,” said Bibby.
His Legacy’s Culmination: NMHC’s Research Foundation
One of the legacies Bibby’s will most be remembered for, not surprisingly given his history, will be the creation of NMHC’s Research Foundation. Bibby led the fundraising effort to secure $2.25 million to create a non-profit dedicated to producing research that will further support the apartment industry’s business interests.
Fully 40 million Americans call an apartment home. Yet limited research exists on the industry that finances, develops and operates those homes—and contributes more than $3 trillion to the economy annually. Our first Research Foundation report was an analysis of risk-adjusted returns across real estate sectors. Guess who had the best adjusted returns? Apartments, whether you look at five years, 10 years, or 15 years.
The Research Foundation’s endowment will work, after Doug passes the baton to a new leader, to raise the industry’s standard of performance and encourage worldwide investment in the sector.
Because Doug is relentless, even as he sees his retirement approaching in a matter of months, he’s given the greenlight to projects that will update our prior research on apartment demand, this time through 2035, and the cost of regulations.
When explaining his embrace of data and research, Bibby asked the 2022 NMHC Research Forum attendees “how many of you are in organizations where your research function doesn’t feel valued?”
“I said this the first day I went in,” said Bibby. “I value research.” The industry is thankful for his attention to this previously under-appreciated resource and his effective use in wielding the data NMHC collected to the industry’s advantage.