Social Icons Superfish

REITS help support nearly 1,000,000 jobs in the U.S. each year.

Forest City Powers Ahead on Development Projects

03/11/2013 | By Allen Kenney

David LaRue, president and CEO of Forest City Enterprises (NYSE: FCE.A), joined REIT.com for a CEO Spotlight video interview at NAREIT’s Washington Leadership Forum.

LaRue analyzed some of the major trends in each of the company’s sectors. Based in Cleveland, Forest City owns, operates and develops properties in the multifamily, office and retail sectors.

“In our apartment business, trends have tracked national averages and have been very strong. We still see good demand for apartment rentals in our core markets,” he said. “With the recovery that has occurred, we saw the consumer come back to the shopping center over the last few years. Our office buildings have remained steady. I think the office sector overall is still looking for that impetus of job creation.”

LaRue noted that Forest City had projects in its pipeline that had to be finished during the economic downturn. They included the new Barclays Center arena in Brooklyn, New York.

“We were able to get through that development. Now, we have started working on a number of apartment projects across the country,” LaRue said.

LaRue discussed the feasibility of accessing the capital markets as well.

“Lending on strong, appropriately leveraged projects has been very good,” LaRue commented. “The interest rate environment has been one that is beneficial to real estate in general, whether you’re an individual who’s refinancing a home loan or a business that is refinancing a loan on a project. We’ve been driving down the cost of our capital. We see capital available for operating assets and, on a more conservative basis, the development assets or construction projects that we do have going. The public markets have been receptive to new offerings that are out there, but with the REIT industry in general, in the last couple of years, there has been a significant amount of capital raised. It is still on the sidelines waiting to be put to use. I think we see that in some of these developments that are coming online.”