Interview: Joseph Maressa

Fortunate

Real estate services companies are enjoying strong growth but the labor shortage is an issue

Joseph Maressa

President & CEO – Title America

How has demand for your services shifted from prepandemic levels? Our business is probably up 30% to 40% from the beginning of the pandemic. We’re very fortunate, as are many in the real estate and real estate services business.We have all seen an explosion in volume. Mortgage companies, title companies and builders were not shut down and have seen an unprecedented increase in volume. At Title America, as is true with most of my competitors, we could run seven days a week. What’s stopping that? We can’t find employees; human capital is at a premium. The workforce pool for the title industry has been practically non-existent during these times.

Which side is driving growth – residential or commercial? We’re seeing both. There’s a lot of commercial refinancing going on because interest rates are so low. Somebody with a 5% loan can refinance and get threeand-a-quarter. On the residential side, it’s driven by people coming out of the urban areas and into the suburbs. People are buying houses at a pace that you would never have imagined pre-COVID. Most of the builders that we’re fortunate enough to do business with are building at a much higher pace than pre-COVID. There’s no shortage of buyers, especially while the rates remain low.

Do you see retail bouncing back after the pandemic? Big box retail, I think, is a thing of the past. I don’t see much big box expansion at all. I’m sure Walmart, Target, Home Depot and Lowes will always build a store here and there but the major expansion for big box and other name retailers is tough because of Amazon and other avenues of e-commerce. That is true all over the country. The way we buy our goods is definitely changing because of advanced technology. What is the near-term outlook for Title America? We’ve been extremely fortunate to have long-standing relationships with many of our clients. I think the outlook for the next year or so, and even longer, is very good as long as interest rates stay low, inflation stays in check, we don’t get overburdened with constraining regulation, and Washington leaves the long-term capital gains rate alone. I think, generally speaking, we may be in something of a bubble. This industry is something of a roller-coaster ride and we’ve been on an upward trajectory for a long time now. What goes up must come down. To what degree? No one knows. When? Your guess is as good as mine. If you’re a student of history, it’s probably sooner rather than later. I certainly don’t have the answers but I think we’re in good shape for the foreseeable future.

( ) commercial real estate investors and local communities as the state rolls out this newly established and regulated market.

Access to cannabis, when done right, can be a redevelopment tool and a vital way to entice more visitors to visit key South Jersey markets, such as Atlantic City and the Cape May coast, which has the potential to benefit all facets of the commercial real estate sector. New Jersey’s budding offshore wind industry bodes well for its southernmost municipalities and the local construction sector. There is a great deal of capacity in the construction industry to support the growing offshore wind industry, local leaders told Invest:.

Despite the challenges however, South Jersey’s overall lower cost of doing business and its budding submarkets create an ecosystem ripe for continued construction and redevelopment, especially for growing industries, such as manufacturing and logistics, as well as for the residential sector. The local market offers a unique area with pockets of economic growth and potential throughout many different neighborhoods and towns. From Camden to Cape May counties, the region’s healthy mix of urban, suburban and tourism corridors coupled with its easy access to Philadelphia and New York City make it a prime destination for live, work and play opportunities in a post-pandemic world.

Office Of all commercial real estate segments, office remains the most challenged more than a year since the onset of the pandemic. Performance indicators at the end of 1Q21 suggest the office sector has a bumpy road ahead,

Construction jobs drastically decreased throughout 2020 due to the pandemic.

Itay Ron

Investment Director – Faropoint

The common notion in the industry is that COVID did not invent anything that was not here before; it just accelerated underlying currents that were already happening. For South Jersey specifically, we anticipate we are going to see a lot of the properties in the core markets in Southern Jersey — Cherry Hill, Mount Laurel, Pennsauken and even further south toward Swedesboro and West Deptford — come to market. Many of those properties are going to switch hands between private ownership and institutional ownership in the next five years as private owners look to cash out of their properties, which are reaching all-time high valuations.