Speaker 1: This is Bloomberg Business Week with Carol Masser and Jason
Speaker 1: Kelly on Bloomberg Radio. So, Jason and I have been
Speaker 1: really looking forward to this next how We've got two
Speaker 1: entrepreneurs where it's safe to say the odds were stacked
Speaker 1: against both. One of the minority one is a woman.
Speaker 1: First up, though, we want to bring in Don Peebles.
Speaker 1: He's founder, chairman and CEO of the Peoples Corporation. It's
Speaker 1: a privately held national real estate investment and development company,
Speaker 1: a multibillion dollar portfolio. They've got projects in New York, Philly, Boston,
Speaker 1: d c, um Miammi, San Francisco, also l A. He
Speaker 1: also served on the National Finance Committee Committee excuse me
Speaker 1: a President Obama and has really done a lot, he
Speaker 1: joins us on the phone in Coral Gables, Florida. Done
Speaker 1: so nice to have you here with us. Welcome to
Speaker 1: Bloomberg Radio. Thank you, good to be here. There's so many,
Speaker 1: so many different places I know Jason and I want
Speaker 1: to go. I do want to start with though your
Speaker 1: vattage point. In the real estate industry, UM one has
Speaker 1: certainly felt the impact of the pandemic. We've had a
Speaker 1: lot of conversations about how real estate uses and demands
Speaker 1: may change as a result of the crisis. What is
Speaker 1: the impact from what you see the longer term maybe
Speaker 1: short term and longer term impacts. Well, short short term impact,
Speaker 1: I think we're seeing it now. There's been a more
Speaker 1: of an exodus out of the cities UM and more
Speaker 1: so into the suburban markets. And then UM more people
Speaker 1: are relocating to places like Florida for example, UH in
Speaker 1: preparation for the winner. But I think that you'll see
Speaker 1: UM and a greater UM you know, stabilization as we
Speaker 1: get through this winter. I mean, the cities are not
Speaker 1: dead New York City, while you know it's it's limited
Speaker 1: occupancy right now in terms of office space, UM. Most
Speaker 1: restaurants are closed, in other businesses are closed. UM. So
Speaker 1: there is a a short term decline because tennis are
Speaker 1: able to pay their rent and the office tenants who
Speaker 1: generate a lot of activity and the marketplace the office
Speaker 1: workers are not there either. But I think that short
Speaker 1: term UM, I do think that the UM pandemic has
Speaker 1: structurally changed how we will consume office space as we
Speaker 1: go forward. I think that companies around the country and
Speaker 1: around the globe, especially here in the US are reevaluating
Speaker 1: how they deal with placing their employees, how much they're
Speaker 1: going to rely upon remote working, which has proven for
Speaker 1: the typical office workers to be much more effective than
Speaker 1: UM most companies thought. And so I think that that
Speaker 1: will be a structural shift in UM. The officis long term.
Speaker 1: I think that UM most retail UM has changed forever.
Speaker 1: But that was a pre pandemic technology. It had disrupted
Speaker 1: retail considerably. And so when you think about sort of
Speaker 1: the reorganized zation, the rethinking of offices done, you know,
Speaker 1: what does that mean? Does does the pricing change? Does
Speaker 1: the relationship between the owner and the tenant change? Does
Speaker 1: what gets developed change? I just wonder sort of thinking
Speaker 1: through the mechanics and and sort of playing that out
Speaker 1: what it looks like. Well, I think that, first of all,
Speaker 1: I think that's the easy one. Is what gets developed
Speaker 1: definitely changes. It will what gets developed going forward will
Speaker 1: change in terms of how the office space will be
Speaker 1: configured going forward, and how protocols will be put in place, UH,
Speaker 1: in terms of how people enter buildings, how we let
Speaker 1: people entering the buildings, in terms of health and UH
Speaker 1: and even once this pandemic is behind us, Uh, the
Speaker 1: new buildings will be better designed and better built to
Speaker 1: address a future a potential pandemic as well. I think
Speaker 1: also the close proximity of coworking and how most companies
Speaker 1: were shifting towards over the floor plants. I think that changes.
Speaker 1: Isn't that kind of sorry to interrupt you, but isn't
Speaker 1: that kind of amazing because that really felt like something
Speaker 1: And listen, you know us, I mean, you know Bloomberg,
Speaker 1: like we were all about the open We still large
Speaker 1: it to a large extent because nobody's really here, But
Speaker 1: I mean that seemed like a trend that was just
Speaker 1: going into going into the future, un unabated in many ways. Yeah,
Speaker 1: I mean Bloomberg was very innovative. When you all built
Speaker 1: your your officers um um um and on the East
Speaker 1: Side and the old Alexander site. What happened there is
Speaker 1: you all created a almost a live and work environment
Speaker 1: to a degree because you've got the open cafeteria. Everything
Speaker 1: was open um, even the waiting areas and so forth
Speaker 1: where visitors were open, and your studios were pretty visible
Speaker 1: and open as well. So I think that that configuration
Speaker 1: is going to change to some degree, especially um, how
Speaker 1: how people work at their desks. And also I think
Speaker 1: GONEA is going to be the days, even with the
Speaker 1: law firms and the like, where each individual has their
Speaker 1: own office for this specific workspace. I think that that
Speaker 1: will change because you'll see a lot more remote working
Speaker 1: and also those who travel to other locations will not
Speaker 1: need a fixed office. So I think the fixed office
Speaker 1: um UH or fifth fixed workspace has changed, will change.
Speaker 1: And I think also you'll see more collaborative spaces that
Speaker 1: have some form of social distancing potential and for the
Speaker 1: immediate use, you'll see that in place now. I mean
Speaker 1: but you, I mean you can really you can see
Speaker 1: that across the board. I happen to be, by the way,
Speaker 1: I'm not implored. I happen to be in zach Harbor.
Speaker 1: But I'm in Manhattan last week, and and and and
Speaker 1: what you're seeing in in UM office spaces that are
Speaker 1: being utilized and very few people are there, and I
Speaker 1: think that's going to take a lot of time for
Speaker 1: people to come back, and and buildings are going to
Speaker 1: have to employers, they're gonna have to tell people by
Speaker 1: action UM that it's safe to come back. So done.
Speaker 1: Let's talk about the wealth gap, because it has been
Speaker 1: a subject that we have I think taken much more
Speaker 1: seriously candidly over the past couple of months, as we've
Speaker 1: really started to I hope embrace this reckoning that we're
Speaker 1: seeing around racial inequality and being Bloomberg and Business Week,
Speaker 1: we follow the money and the wealth gap is vast.
Speaker 1: I don't have to tell you what do we do
Speaker 1: about it? Well, I think we've got to widen the opportunity.
Speaker 1: I think that there's no talent is discriminated, distribintate and discriminately,
Speaker 1: and uh, you know, opportunity is discribuinated on a discriminatory basis,
Speaker 1: and I don't. I think that we've got to look
Speaker 1: at expanding access to capital, expanding opportunities in every industry
Speaker 1: across the board, and be mindful that we as business
Speaker 1: owners and entrepreneurs and CEO have to take affirmative steps
Speaker 1: and providing fair access to career and economic opportunities to
Speaker 1: minorities and women because both are severely underrepresented in every
Speaker 1: industry of any consequence in this country. You know, don
Speaker 1: the you know, our team here at Bloomberg did a
Speaker 1: story about Silicon Black Silicon Valley entrepreneurs venture capitalists and
Speaker 1: how they had reached certainly success in their lives and
Speaker 1: you know, in terms of Silicon Valley, but they were
Speaker 1: even having trouble being able to support other minority owned
Speaker 1: businesses at their own firms. We're finding it difficult to
Speaker 1: get others to get on board with them, and so
Speaker 1: I wonder, what's the trick here, how do we interess Well,
Speaker 1: I think that we have to. I mean, my industry
Speaker 1: is one that I think is has an easy remedy
Speaker 1: to it. It's um. You know, the real estate development
Speaker 1: business is a low barrier to entry industry. You can
Speaker 1: start off from any perspective UM as an entrepreneur and
Speaker 1: go into real estate development. Doesn't require any kind of
Speaker 1: license of specialized skill, requires some talent and access to capital.
Speaker 1: And the capital that funds real estated mainly through private
Speaker 1: equity and private equity. Biggest investors are public employee pension systems,
Speaker 1: and so for example, there's about seventy trillion dollars in
Speaker 1: venture capital and private equity right now, and about one
Speaker 1: point three percent of that money is deployed to businesses
Speaker 1: owned or run by minority to women combined. And yet
Speaker 1: a significant portion of the contributors to the public pension
Speaker 1: systems of workers who whose money is being invested are minorities,
Speaker 1: and when me and so if we can have fair
Speaker 1: access to that capital, and those investors tell the allocators
Speaker 1: of capital that they want to see their capital deployed
Speaker 1: in a more diverse manner. Prudently by the way, but
Speaker 1: more diverse matter. Um, there is no shortage right now
Speaker 1: of capital in the marketplace. There's a shortage of where
Speaker 1: to deploy the capital. That's why we're seeing this from
Speaker 1: the market reactive way. It is um and so I
Speaker 1: think the other aspects it's important is people have to
Speaker 1: understand we're not we don't in order to bring equality.
Speaker 1: It's not about redistributing wealth, redistributing opportunities. It just expanding
Speaker 1: it and expanding opportunities to create wealth. And so don
Speaker 1: how do those institutional investors. I agree with everything you're saying,
Speaker 1: and you're echoing something that John Rodgers said on this
Speaker 1: program about the institutional investors and especially the public pension funds,
Speaker 1: which candidly they've gotten legion about some other issues. You know,
Speaker 1: sometimes it's around gun control and other things where they've
Speaker 1: essentially said, look, I'm not going to invest in certain
Speaker 1: sectors or I'm not going to invest in certain managers
Speaker 1: unless they meet these certain criteria. E. S G has
Speaker 1: been an area, especially around the environment and climate where
Speaker 1: they've done that. Why haven't they done this yet in
Speaker 1: your estimation? Well, I think that in part because they
Speaker 1: are missing misinterpreting their role in studuciaries. I think that
Speaker 1: the idea to pick the most qualified, the best, and
Speaker 1: the least risky, it's got the firm that's been around longest.
Speaker 1: And so if you're going to have an aversion to first, second,
Speaker 1: third time funds, then it's going to be very difficult
Speaker 1: for you to create an environment where there will be
Speaker 1: more minority and women manage funds. So they've got to
Speaker 1: be willing to um make strategic, prudent investments and utilizing
Speaker 1: a different criteria, one that doesn't say you were established firms.
Speaker 1: And by the way, it's just as hard for a
Speaker 1: white male who starts off with no family money to
Speaker 1: go into this space also, right, So, because the system
Speaker 1: favors the established, larger firms and UH, and so I
Speaker 1: think they've got to change how that capital is deployed
Speaker 1: by how they evaluate where they're going to deploy with right, Well,
Speaker 1: we could talk to you all day. This is fascinating.
Speaker 1: As you can tell, we are pretty into this topic.
Speaker 1: And and I couldn't agree with you more. I mean
Speaker 1: I have said on this program and elsewhere that you know,
Speaker 1: nobody had a public pension fund ever got fired for
Speaker 1: giving more money to Blackstone or KKR, Carlisle. I mean,
Speaker 1: it's just the system is built in a certain way
Speaker 1: and it needs to be rethought. John Peoples, thank you
Speaker 1: so much, Chairman and CEO of the People's Corporation joining
Speaker 1: us on the phone from Long Island. Really thoughtful, um
Speaker 1: and constructive in many ways. And he's exactly right that
Speaker 1: the institutional money has to change.