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CHICAGO ROOFTOPS 2016 Property Perspectives for
THE ROOFTOPS CONFERENCE CHICAGO 2016 Philip H. Corboy Law Center 25 E. Pearson Street Chicago, IL 60611 T 312.915.7833 E [email protected] Property Perspectives for Not-for-Profit Organizations Friday, February 12, 2016 8:30 a.m. – 2:00 p.m. Loyola University Chicago School of Law 25 East Pearson Street Chicago, IL Center for Real Estate Studies 185 West Broadway New York, NY 10013-2921 T 212.431.2306 E [email protected] Co-Presented by The Rooftops Project at the Center for Real Estate Studies, New York Law School The Business Law Clinic at the Center for Business Law, Loyola University Chicago School of Law A few important notes and a legal disclaimer (after all, at New York Law School we are trained as lawyers and we train future lawyers, so inevitably we think like lawyers): • T he Rooftops Conference 2016 and these accompanying materials are not intended and should not be construed as legal, tax, investment, or professional advice. • T he information and views expressed may not apply to individual readers or to their organizations or to any particular facts or circumstances. • A ttendance at The Rooftops Conference 2016 or receipt of these materials does not create any attorneyclient relationship. THE ROOFTOPS PROJECT Project Mission and Goals The Rooftops Project is an initiative founded and directed by James Hagy, Distinguished Adjunct Professor with the Center for Real Estate Studies at New York Law School. It provides real estate programs, workshops, and Web and print resources for not-for-profit organizations, with several goals: n T o be the host of an ongoing dialogue within the community of not-for-profit executives and managers, not-for-profit board members and volunteers, and real estate industry professionals about topics relating to the effective occupancy, use, and management of real estate in the social sector. n T o highlight and celebrate the diverse roles played by real estate (as physical space) in supporting the missions of not-for-profit organizations of every type, from museums to places of worship, from social and human services to education and advocacy. n T o increase awareness of the contribution that a disciplined approach to real estate can make in not-for-profit organizations of every size, from those with a single location to those with a national or international presence. Copyright © 2016 Rooftops Group LLC. Copyright to individual articles and other content reproduced in conference materials is held and retained by the individual author or copyright holder. All rights are expressly reserved. Conference presentations and these materials may not be quoted, copied, referenced, or reproduced in any way, in whole or in part, whether in printed or electronic format, without express written permission, which may be given or withheld in the sole discretion of the individual author or copyright holder. • E ngagement and consultation with appropriately qualified, experienced, and licensed professionals should always be sought with respect to planned transactions, investments, and projects. • T hese materials are provided as a supplement to the panel discussions and presentations at the live conference, but do not serve as a summary or outline of the live discussion. They do not purport to be a complete or exhaustive treatment of the topics they address. • V iews expressed by speakers and panelists, or in these materials, are not necessarily those of New York Law School, Loyola University Chicago School of Law, their faculty, staff, or students. • N either New York Law School nor Loyola University Chicago School of Law, nor the faculty or staff of either, evaluate, rate, review, or recommend products, services, or suppliers whatsoever. Any particular products, services, or suppliers mentioned are used as examples to illustrate concepts and are for general information only. • N o representations or warranties are given whatsoever, express or implied, with respect to information presented at The Rooftops Conference or contained in these materials or their accuracy. Any representations or warranties that might otherwise exist, whether by statute, common law, or otherwise, are expressly excluded and disclaimed. • N ew York Law School, Loyola University Chicago School of Law, and their faculty expressly disclaim and do not accept any liability for any loss resulting from errors or omissions contained in, or for following or applying principles or views expressed at, The Rooftops Conference or in these materials, including without limitation any liability for direct, indirect, consequential, exemplary, or punitive damages or for loss of profits or business opportunity, whether by tort, negligence, breach of contract, or otherwise. THE ROOFTOPS CONFERENCE AGENDA 8:30 a.m. Registration and Continental Breakfast 8:45 a.m. – 8:55 a.m. Welcome Conference Moderator and Co-Host: James Hagy, Distinguished Adjunct Professor and Director of The Rooftops Project, New York Law School, and Senior Lecturer in Residence, Loyola University of Chicago School of Law Conference Co-Hosts: Shelley L. Dunck, Randy L. and Melvin R. Berlin Clinical Professor of Business Law and Director, Business Law Clinic, Loyola University of Chicago School of Law Mary K. Hanisch, Program Director, Center for Business Law and Assistant Director, Business Law Clinic, Loyola University of Chicago School of Law 8:55 a.m. – 9:15 a.m. Snapshots from the Rooftops: Introductory Remarks Professor James Hagy This presentation will introduce The Rooftops Project’s field of dialogue and research and frame our program for the day. 9:15 a.m. – 9:45 a.m. Strength in Numbers: Chicago Literacenter Stacy Ratner, Co-Founder and Creative Director, Chicago Literacy Alliance; Larry Serota, Executive Vice President, Tenant Advisory Office, Transwestern Business news is often filled with stories about incubator spaces and entrepreneurial hubs in which start-up companies can hang out, network, and grow. What might result when these concepts are adapted to bring together diverse not-for-profit organizations focused on similar missions? The Chicago Literacy Alliance demonstrates the potential for this model at its new Chicago Literacenter, recently opened just west of Chicago’s downtown Loop business district and named by Chicago Inno as one of Chicago’s “50 on Fire” winners. 9:45 a.m. – 10:30 a.m. My House? Your House? Our House? When Not-for-Profits Wish to Co-Locate James Hagy, Director, The Rooftops Project; Ryan Oberly, Wagenmaker & Oberly, LLC; Sally Wagenmaker, Wagenmaker & Oberly, LLC There are many reasons why two not-for-profit organizations might consider sharing space (occupancy) or co-locating at a single property. The hosting organization may have excess space at its owned or leased location, or may wish to share or offset occupancy costs. The hosted organization may seek affordable (or even free) space in which to start up or to expand its activities to a new part of town. Either organization may wish to support or have the benefit of proximity and collaboration with another non-profit with a complementary mission. Funders may encourage sharing space for these or other reasons, or may themselves offer incubator space. The mix of motives is as variable as the organizations themselves. How can non-profits be better prepared to evaluate the proposed arrangement, be informed decision-makers in structuring and balancing an optimal relationship, and be effective participants working with their lawyers and other professionals to implement a space sharing arrangement? How can real estate lawyers bring their extensive commercial experience and broad perspective to the benefit of non-profit clients in these situations? These themes will be explored through an unscripted, impromptu simulation in which our experienced panelists will play the roles of board members on behalf of two fictional (but realistic) not-for-profit organizations considering sharing space for the first time. 10:30 a.m. – 10:45 a.m. Break 10:45 a.m. – 11:30 a.m. Capital Projects: Plans and Surprises John Duggan, Senior Vice President, The Concord Group Capital projects take significant planning and financial resources in order to be completed successfully. What is initially envisioned may evolve into something quite different, ideally a solution best suited to the parameters of site, budget, mission, and program combined. For every new construction project, that expected (or unexpected and urgent) capital repair may lurk around the corner this fiscal year, too. This presentation will highlight the importance of completing a detailed project feasibility and due diligence study and how this phase of the project contributes to the overall project success. The benefits of a facilities condition assessment for existing properties and building systems will also be examined. The discussion will also identify the importance of engaging the right team members with the correct skill sets to protect the owner’s interests. 11:30 a.m. – 12:30 p.m. Risk Management for Not-for-Profit Properties and Projects Howard Blumstein, Chicago Assurance Managing Partner, BDO; Robert Lehrman, Senior Vice President, Marsh; Kristine Marek, Client Adviser, Marsh Private Client Services; Maureen McGuire, Partner, MacCabe and McGuire; Kathryn VandenBerk, Of Counsel, Bea & VandenBerk; Everett Ward, Partner, Quarles & Brady LLP Litigators and insurers alike frequently mention real estate as a key source of potential financial and operational risk for any organization. What lessons can not-for-profit organizations draw in managing risk with respect to the properties they operate, or occupy? How should risk management figure into real estate transactions such as sales, purchases, and leasing? How should not-for-profits address property risk associated with formal and informal use of their space by other organizations? What connections are there between not-for-profit regulatory compliance and governance, and real property ownership and project finance? And what are the proper roles of board member volunteers in the risk management process? 12:30-1:30 p.m. Luncheon Program: What Is Your Building Saying to Your Audience? John Russick, Vice President for Interpretation and Education, Chicago History Museum Whatever your organization’s mission type, what role does your physical space play in communicating that mission and in building your brand? How do design, function, and operation of real estate affect the audiences you seek and serve, from visitors to employees and donors? John Russick will share thoughts on ways in which physical space is an integral tool in achieving mission, drawing in part from his own experiences at the recently renovated Chicago History Museum and in its constantly evolving exhibits and spaces. 1:30 – 2:00 p.m. Reception Our reception offers a chance, over dessert and beverages, to meet peers and to chat with our speakers, panelists, faculty, and students involved in The Rooftops Project. THE ROOFTOPS CONFERENCE SPEAKERS MODERATOR JAMES HAGY, Distinguished Adjunct Professor and Director, The Rooftops Project, New York Law School, and Senior Lecturer in Residence, Loyola University Chicago School of Law Jim Hagy is Distinguished Adjunct Professor of Law at New York Law School and Senior Lecturer in Residence, Loyola University Chicago School of Law. He also founded and directs The Rooftops Project at New York Law School’s Center for Real Estate Studies. Jim also serves as an affiliated transnational professor at Peking University School of Transnational Law and lectures frequently at other universities and for business audiences in the United States and abroad. During his 28-year career with Jones Day, the global law firm, Jim served for 10 years as the co-chair of the firm’s worldwide general real estate practice. He also formed and chaired the firm’s Corporate Real Estate Services practice worldwide. He advised a broad range of Fortune 500, FT 500, and private companies in major national and international transactions. PANELISTS AND SPEAKERS HOWARD BLUMSTEIN, Chicago Assurance Managing Partner, BDO As the Chicago Office Managing Partner of Assurance Services at BDO, Howard Blumstein is responsible for establishing objectives and managing all aspects of the assurance practice, including strategic planning, budgeting, client service, recruiting and staff development. Howard serves a wide range of clients, from nonprofit associations and organizations to international corporations. In addition to delivering accounting and auditing services, Howard consults with his clients on a wide range of financial matters, from daily operations to acquisitions, providing ongoing financial advice and offering strategic approaches to reporting. His community involvement includes serving as Treasurer of the Homewood-Flossmoor Park District and the Homewood-Flossmoor Soccer Club, serving as a member of the Lincoln Park Zoo Planned Giving Advisory Council, and being a member of the Board of Directors of LINK Unlimited Scholars. JOHN DUGGAN, Senior Vice President, The Concord Group John has led The Concord Group’s Milwaukee office and all project management services throughout the firm since 2003. As the principal responsible for all project management services, he oversees the coordination and control of the planning, design, construction and close-out phases for these projects. John began his career in England where he provided project management and cost management services. He relocated to the United States in 2000 as a project manager for a leading retirement and continued care provider, where he gained significant experience in the management of design and construction on numerous projects. He holds a Bachelor of Science in Quantity Surveying. SHELLEY L. DUNCK, Randy L. and Melvin R. Berlin Clinical Professor of Business Law and Director, Business Law Clinic, Loyola University of Chicago School of Law Shelley Dunck is the Co-Director of the Business Law Center at Loyola University Chicago School of Law. She received her undergraduate degree from the University of Michigan, and she earned her law degree from Loyola, where she was a member of the Law Journal. After graduating from law school, she practiced with Skadden, Arps, Slate, Meagher & Flom and later with Rosenberg & Liebentritt, both in Chicago. Before joining the law school, Professor Dunck was the Associate General Counsel, First Vice President, and Associate Secretary of Equity Residential Properties Trust in Chicago. MARY K. HANISCH, Program Director, Center for Business Law and Assistant Director, Business Law Clinic, Loyola University of Chicago School of Law Mary Hanisch is the Assistant Director of the Business Law Clinic and Program Director for the Center for Business Law. Prior to joining Loyola, Ms. Hanisch worked as a corporate paralegal at Polsinelli and as an attorney in private practice. She received a Master of Laws degree in Business Law from Loyola University Chicago School of Law, a Juris Doctor degree from Washburn University School of Law, and Bachelor of Arts degrees in Religion and Political Science from The University of Iowa. ROBERT LEHRMAN, Senior Vice President, Marsh Robert Lehrman is a client executive in Marsh’s Chicago office. In this role, he leads and coordinates new business development and the delivery of all Marsh services. He is the principal contact point, maintaining overall accountability and deploying necessary resources to fulfill and exceed clients’ expectations for a diverse range of clients, with specific expertise in complex financial firms, environmental liability, real estate, manufacturing, construction, health care, and service industries. Prior to joining Marsh, Bob spent 25 years as a senior executive for national insurance companies and brokers. Previous to his insurance career, Bob was an options and futures trader at the CBOE and CBOT in Chicago. He holds a BA in economics from the University of Wisconsin and an MBA in Finance from Loyola University Chicago. KRISTINE MAREK, Client Advisor, Marsh Private Client Services Kristine Marek manages insurance services and programs for high net worth individuals and families. She ensures the unique insurance needs of her clients are met by reviewing potential exposures, loss experience and current coverages; analyzing and establishing comprehensive personal asset protection programs; recommending appropriate products and services; and acting as her clients’ advocate when dealing with insurance carriers. She holds a Bachelor of Science degree in Corporate Communications and Theatre from Olivet Nazarene University. MAUREEN MCGUIRE, Partner, MacCabe and McGuire Maureen McGuire has thirty-two years of corporate, real estate and defense litigation experience. She has significant trial experience, and of note obtained a very rare not guilty jury verdict in a Cook County, Illinois Federal Employers’ Liability Act case where the plaintiff’s claimed damages exceeded $1 million. She has significant transactional experience in representing the firm’s corporate clients, associations, and not-for-profit corporations. She is a director of the Norwood Life Society, which she served as chairperson from 2011-2013. RYAN OBERLY, Partner, Wagenmaker & Oberly, LLC Ryan Oberly represents a diverse group of tax-exempt organizations, including public charities, private foundations, religious and educational institutions, trade associations, social clubs, and social enterprises. From start-ups to complex corporate and tax planning, Ryan works with clients to protect tax-exempt status, facilitate organizational growth, and manage risks. He has successfully represented clients in IRS audits and state attorney general investigations. His practice covers nonprofit governance, fundraising laws in all fifty states, unrelated business income, private benefit, political campaign and lobbying restrictions, and other federal and state tax issues affecting nonprofits. Ryan advises clients through corporate mergers, joint ventures, and diverse multi-state and international operations. He is also well versed in intellectual property issues facing nonprofits and regularly works with clients to register, protect, transfer, and enforce trademark and copyright interests. Ryan is an adjunct lecturer at DePaul University’s College of Law where he teaches a graduate level course on the law of nonprofit organizations. STACY RATNER, Co-Founder and Creative Director, Chicago Literacy Alliance Thirtysomething years ago, Stacy learned to read. This life-changing experience led to degrees in law and literature, allowed her to help take three startup companies from idea through a combined total of $30 million in committed venture funding, and finally brought her to the cause of literacy in 2006. She began by founding Open Books, an award-winning nonprofit social venture that now serves 5,000 students each year through a spectrum of exciting programs funded in large part by the sale of used books in its two award-winning Chicago stores. Three years later, she co-founded the Chicago Literacy Alliance…and could not be more excited about what it has become. Stacy was recently named one of Chicago Magazine’s Chicagoans of the Year for 2015. She has also received an Emerging Leader Fellowship from the Chicago Community Trust, places on NewCity’s Lit 50 and the national 40 Women To Watch Over 40 list, the Social Enterprise Alliance’s Innovation award, and recognition on the White House’s official blog for “spreading the infinite and awesome power of books,” but is most inspired by the amazing things that her colleagues make happen every day. She writes a novel every year, eats ice cream every day, and is always starting something. And, yes: her hair really is green. JOHN RUSSICK, Vice President for Interpretation and Education, Chicago History Museum John directs the development of interpreted experiences at the Museum. He also served as Vice Chair of the Museum‘s Visioning Committee, an initiative that culminated with the publication of Claiming Chicago: Shaping Our Future (2007). Since arriving in 1998, John has worked on a host of projects for the Museum, including The 5th Star Challenge and The Great Chicago Adventure (2015); Magic (2012); My Chinatown (2009); Mapping Chicago: The Past and the Possible (2007); and in the Museum’s children’s gallery, Sensing Chicago, which received an honorable mention in the 2007 Association of American Museums’ exhibition competition. John served as a consultant on the 2011 Florentine Films documentary, Prohibition, directed by Ken Burns and Lynn Novick. Since 2009, he has co-organized the American Association of Museums’ annual Excellence in Exhibition Label Writing Competition. In 2006, John led a Chicago citywide committee of architecture historians to celebrate Louis Sullivan’s 150th birthday, which included an international symposium planned and directed by John. He serves as a member of the Standing Committee on Ethics for AAM’s Curators Committee. His most recent publication, A Place For Everything, was released on Medium in 2014 as part of the CODE-WORDS project. Other recent publications include Connecting Kids to History with Museum Exhibitions (Left Coast Press), which was co-edited with D. Lynn McRainey. John holds a Master’s of Science in Architectural Studies from the University of Texas at Austin and a bachelor’s degree in History, with a specialization in Historic Preservation, from Northern Illinois University. THE ROOFTOPS CONFERENCE SPEAKERS LARRY SEROTA, Executive Vice President, Tenant Advisory Office, Transwestern Larry Serota specializes in tenant representation, representing users of space throughout the United States and advising clients on real estate strategies that align with overall organizational goals and financial objectives. Additionally, Larry is a member of Transwestern’s Board of Directors, serves as Chair of Transwestern’s Emerging Leaders Council and Nonprofit Advisory Group, and is a member of the National Tenant Advisory Council, working closely with executive leadership to develop key innovation strategies and new business opportunities. He has successfully integrated his personal commitment to sustainability within his business practice, becoming a LEED accredited professional. He facilitates the creation of healthy and productive workplaces by implementing sustainable design strategies aiding in the reduction of a company’s operational costs and carbon footprint. In 2015, Larry was honored by Real Estate Forum as one of the “Top 50 under 40” of all commercial real estate professionals in the U.S. He received the National Excellence in Sustainability Award in 2013, and the President’s Award across all service lines for the Midwest in 2012. Larry’s community involvement includes being Chairman and Co-Founder of the Chicago Children’s Museum’s Metropolitan Board, a Leadership Greater Chicago 2013 Fellow, and serving as past Co-Chair and a Member of the Auxiliary Board of the High Jump Mentoring Program, past Co-Chair & Member of the Auxiliary Board. KATHRYN VANDENBERK, Of Counsel, Bea & VandenBerk Kathryn VandenBerk focuses on nonprofit, tax-exempt organizations, including nonprofit start-ups, corporate and tax law, and employment issues. She practiced law in Madison, Wisconsin, for nine years before serving as the president of two residential treatment centers for children. Kathryn has taught a graduate level seminar in Employment Law at North Park University and has guest lectured at North Park’s School of Business and Nonprofit Management. She is a member of the Advisory Board of the Axelson Center for Nonprofit Management at North Park University, the Tax Exempt Division of the Chicago Bar Association, and is a former officer of the Association of Consultants to Nonprofits. SALLY WAGENMAKER, Partner, Wagenmaker & Oberly, LLC Sally Wagenmaker provides legal counsel in corporate, tax, employment, and real estate matters for nonprofits operating on local, national, and international levels. Her clients include churches and other religious organizations, social service providers, and schools. Sally’s corporate and tax work includes development of new tax-exempt entities, providing guidance for effective nonprofit governance, and other operational legal issues. In addition, she represents clients in property tax exemption matters for charitable, religious, and educational purposes, shared occupancy arrangements, and property transfers. Sally also regularly advises and counsels the firm’s nonprofit clients on employment matters including contracts, termination, employment policies, unemployment insurance, and compliance with other employment laws, particularly as they relate to nonprofit issues such as volunteers and clergy. Prior to practicing law with Wagenmaker & Oberly, Sally was a partner with Mosher & Wagenmaker and also worked with the Chicago law firm of Hoogendoorn & Talbot. In addition, she worked as a solo practitioner, providing legal assistance to indigent and low-income clients primarily in Chicago’s west side neighborhood of North Lawndale. EVERETT WARD, Partner, Quarles & Brady LLP Everett S. Ward is a partner in Quarles & Brady’s Chicago office. He is a member of the firm’s national Real Estate Group. He represents corporate, commercial, and not-for-profit clients in the acquisition, disposition, financing, and leasing of commercial, industrial, and residential real property, including hotels, industrial properties, mixed-use properties, manufactured housing developments, multifamily developments, office buildings, and shopping centers. Everett also represents clients in the formation and financing of real estate joint ventures on both stabilized assets and development projects. He is a fellow of the American College of Real Estate Lawyers and the American College of Mortgage Attorneys. He serves as a member of the Board of Trustees of The Field Museum of Chicago and on the board and the executive committee of the Oak Park Economic Development Corporation. He was also a member of the board of directors of Thresholds from 1996-2008 and its board president from 2000-2002. A few important notes and a legal disclaimer (after all, at New York Law School we are trained as lawyers and we train future lawyers, so inevitably we think like lawyers): • T he Rooftops Conference 2016 and these accompanying materials are not intended and should not be construed as legal, tax, investment, or professional advice. • T he information and views expressed may not apply to individual readers or to their organizations or to any particular facts or circumstances. • A ttendance at The Rooftops Conference 2016 or receipt of these materials does not create any attorneyclient relationship. THE ROOFTOPS PROJECT Project Mission and Goals The Rooftops Project is an initiative founded and directed by James Hagy, Distinguished Adjunct Professor with the Center for Real Estate Studies at New York Law School. It provides real estate programs, workshops, and Web and print resources for not-for-profit organizations, with several goals: n T o be the host of an ongoing dialogue within the community of not-for-profit executives and managers, not-for-profit board members and volunteers, and real estate industry professionals about topics relating to the effective occupancy, use, and management of real estate in the social sector. n T o highlight and celebrate the diverse roles played by real estate (as physical space) in supporting the missions of not-for-profit organizations of every type, from museums to places of worship, from social and human services to education and advocacy. n T o increase awareness of the contribution that a disciplined approach to real estate can make in not-for-profit organizations of every size, from those with a single location to those with a national or international presence. Copyright © 2016 Rooftops Group LLC. Copyright to individual articles and other content reproduced in conference materials is held and retained by the individual author or copyright holder. All rights are expressly reserved. Conference presentations and these materials may not be quoted, copied, referenced, or reproduced in any way, in whole or in part, whether in printed or electronic format, without express written permission, which may be given or withheld in the sole discretion of the individual author or copyright holder. • E ngagement and consultation with appropriately qualified, experienced, and licensed professionals should always be sought with respect to planned transactions, investments, and projects. • T hese materials are provided as a supplement to the panel discussions and presentations at the live conference, but do not serve as a summary or outline of the live discussion. They do not purport to be a complete or exhaustive treatment of the topics they address. • V iews expressed by speakers and panelists, or in these materials, are not necessarily those of New York Law School, Loyola University Chicago School of Law, their faculty, staff, or students. • N either New York Law School nor Loyola University Chicago School of Law, nor the faculty or staff of either, evaluate, rate, review, or recommend products, services, or suppliers whatsoever. Any particular products, services, or suppliers mentioned are used as examples to illustrate concepts and are for general information only. • N o representations or warranties are given whatsoever, express or implied, with respect to information presented at The Rooftops Conference or contained in these materials or their accuracy. Any representations or warranties that might otherwise exist, whether by statute, common law, or otherwise, are expressly excluded and disclaimed. • N ew York Law School, Loyola University Chicago School of Law, and their faculty expressly disclaim and do not accept any liability for any loss resulting from errors or omissions contained in, or for following or applying principles or views expressed at, The Rooftops Conference or in these materials, including without limitation any liability for direct, indirect, consequential, exemplary, or punitive damages or for loss of profits or business opportunity, whether by tort, negligence, breach of contract, or otherwise. THE ROOFTOPS CONFERENCE CHICAGO 2016 Philip H. Corboy Law Center 25 E. Pearson Street Chicago, IL 60611 T 312.915.7833 E [email protected] Property Perspectives for Not-for-Profit Organizations Friday, February 12, 2016 8:30 a.m. – 2:00 p.m. Loyola University Chicago School of Law 25 East Pearson Street Chicago, IL Center for Real Estate Studies 185 West Broadway New York, NY 10013-2921 T 212.431.2306 E [email protected] Co-Presented by The Rooftops Project at the Center for Real Estate Studies, New York Law School The Business Law Clinic at the Center for Business Law, Loyola University Chicago School of Law