Renata Simril Jumps to Jones Lang LaSalle; Heads Public Institution Group for Southwest

You recently left Forest City's Los Angeles office to join the firm of Jones Lang LaSalle, Why Now? Why JLL?

The capital markets and the economic challenges we're facing, both locally and nationally, have put the breaks on development. I very much enjoyed my 5-plus-year tenure with Forest City Development. Forest City is a great company, run by a great family. I was involved with great projects, but I was recruited for this opportunity to lead the Southwest region for the Public Institution Group, to help optimize the real estate assets of public institutions, which could help offset budgets challenges, and give their focus to more mission-critical activities. Looking at the JLL brand, the PI Group's growth trajectory, and the need within this marketplace, it was an offer I couldn't refuse.

What is the focus of your work at Jones Lang LaSalle? What are your priorities?

This is a new position for the firm in this region, although I have been in and around government for some time-worked for Mark Ridley-Thomas and Mayor Jim Hahn. I am focused on the unique needs of public institutions, such as federal, state and local governments, universities, and school districts, particularly on advising them on strategies to help manage and use their real estate assets more efficiently. Given the severe budget issues that public institutions are facing, the expansion of our practice to the local level is timely. The task I have assumed is to grow the firm's business in the Southwest Region, which extends from L.A. down to San Diego over into Arizona and Nevada.

What specifically in Jones Lang LaSalle's portfolio of business attracted you to join their company?

Nationally, we count as clients the General Service Administration, the Army-we manage a pretty robust privatized housing program for the Army-and the Air Force. Regionally, we have done work for CCDC in San Diego, are doing work for the San Diego Unified School District, and the city of Orange. Locally, we've done work with Los Angeles World Airports and the University of Southern California. We have also advised a number of cities in the Inland Empire. JLL is a global real estate services firm with a fully integrated platform of real estate and advisory services for both public and private entities. The opportunity to expand the JLL platform and partner with other large- and small-scale public institutions throughout the region to help them with their real estate holdings is exciting.

What real estate services does Jones Lang LaSalle provide to these large, public institutions that they don't already have in-house?

Most public institutions have real estate functions, doing a decent job of managing their assets. But real estate isn't the ‘core mission' of these institutions. On the contrary, it is making sure we are safe and protected, paving our streets, or educating our kids.

Real estate is usually the largest cost on a public institution's balance sheet second to personnel. We partner with public institutions in an advisory role, helping them look at their RE organizational structures, real estate assets, and leases to help create efficiencies that could help them optimize better. If it is a downsizing government, perhaps they don't need as many leased facilities or they might be spread out in multiple buildings and could realize cost savings from restacking into one facility. We work with staff to help analyze and development these strategies. We bring proven private sector best practices, maximizing those real estate assets to operate more efficiently and, perhaps, generate ancillary revenue that can help them off-set budget challenges and, more importantly, help them focus on mission-critical activities.

Jones Lang LaSalle has many more services than those you have described. Can you talk about other services that pertain to the public sector institutions you referred to? Are you involved in helping public institutions build sustainably, or are you interested in the land locations and options?

The JLL platform runs across the real estate spectrum. We have an energy and sustainability (ESS) practice that can provide sustainability best practices to the public institution; retrofitting of existing buildings or advising on other renewable strategies; our project development services (PDS) group can assist institutions with their construction needs-be it a new civic center development, police, or fire station. PDS also can help with space utilization and tenant build out projects. All of the professionals within that practice group are LEED certified. We also have a building facilities and a property management group that can services all facilities and building management needs. We have a clean tech practice group that works with renewable energy and clean tech companies and tenants to address their real estate needs.

The city of Los Angeles, for example, has a clean tech initiative that is trying to grow that industry as an economic development strategy to grow jobs and revenue. We have a niche group within JLL that is on the forefront of companies looking to move into the Southern California region and working with public institutions on those types of strategies-what those tenants and clients are looking for to better tweak those economic development strategies to capture them in a particular region. We provide a unique, robust, full spectrum of real estate services to public institutions to help them meet their needs.

You've been intimately involved with real estate development and planning in the metropolitan L.A. region for a long time. Who's handling it better around the Southwest? What jurisdictions or public institutions are role models for others with respect to managing their real estate assets?

I can't say that any one public institution or region is doing it better-or worse for that matter-than another. My experience with municipalities in particular is that due in part to the structure of government, the often decentralized RE organizational structure and the fact that real estate isn't its core mission most are pubic institutions are reactive in nature and shorter term in their thinking. This isn't meant to be critical, I appreciate the challenges and focus it takes to run a city, particularly in these trying economic times-there is only so much time in the day. We strive to help them think longer term and develop more proactive and strategic management plans.

I have found that the city of San Diego has been much more progressive in creating an organizational structure and asset management plan to better understanding and optimize their assets through the creation of an Asset Management Plan that is updated annually. Again, real estate management is not the core function of public institutions. In my experience, institutions that are more forthcoming in seeking private sector best practices to evaluate and analyzing how best to use their real estate are the role models for other municipalities.

You have made panel presentations that we've carried in our newsletters, about the role of planning in Los Angeles and the opportunities, or lack thereof, to utilize the assets and resources in terms of land here to improve neighborhoods, communities, and public institutions. What's your take on L.A. at the moment?

L.A. has huge opportunities, clearly, as it relates to land. We are still in the depth of a recession and real estate asset values have declined. There's no doubt about that. There are challenges. But as the market begins to improve, which it will now is the time to start looking at underutilized land as an example, developing strategies that could help monetizing or seeking value through private partners is still ripe with opportunities.

Public institutions have the opportunity to benefit from real estate advisors, such as Jones Lang LaSalle, to begin now to plan for the next up-tick in the cycle-looking at what assets they have, what assets are mission critical, what assets are underutilized, and what assets are non-essential and could be disposed of, either at a sale or in a public-private venture, where they are able to generate annuity payments through ground leases. The market provides an opportunity to do pre-planning advisory work-strategy development-for cities like Los Angeles and the county to take advantage so that when the market starts to pick up, they will hopefully see better value from these efforts in the future.

You've done a lot over the last decade or more. What should the readers of this interview know about your background, related to the services that you're offering, to suggest that you know what you're talking about and can be of value?

I am passionate about this work, both as a private professional and as a former public service staffer. I bring a unique perspective that many of our competitors in the marketplace don't in having served in a public sector capacity, having worked in the legislative branch for former City Councilmember Mark Ridley-Thomas and in the capacity of Deputy Mayor of Economic Development and Housing for former Mayor Jim Hahn. I know first hand the challenges that public institutions face and the political pressures that challenge decisions. I understand also the landscape of California, the city of Los Angeles, and Los Angeles County, in terms of the political and legislative challenges in dealing with real estate.

That background, coupled with a background in real estate development, brings a balanced perspective to help agencies and public institutions utilize their real estate much more effectively. It's not about just coming up with a plan or strategy but also navigating the political landscape in a way that allows you to implement and realize that plan or strategy. That's a unique skill set that I bring along with the firm as a whole; for us, it is all about providing the best possible service for our clients, public or private.

Institutions pressed to cut their budgets will look to collaborate, and leverage, and build joint use with each other for schools, cities, parks, and healthcare. You wrote a paper for the L.A. Community Redevelopment Agency about this some years ago for New Schools Better Neighborhoods. Are those concepts of interest to your clients, and what are the challenges that you share with them on how to execute?

Those concepts are definitely an opportuntiy, which a lot of our clients are already looking toward, particularly school districts. The great thing about monetizing an underutilized or non-essential landholding or building is that at the end of the day, you have a bag of cash from effectuating that strategy that helps you off set that one time budget challenge.

Some of the strategies that we try to employ are private-public partnerships that result in a longer stream of revenue to the public coffers-can you engage in a lease transaction with a public party that creates a share of revenue? That's an example of what public institutions will be seeking. These trends that continue, public-private partnerships, P3 financing, and strategic privatization strategies, allowing public institutions to stay as a partner within the transaction and realize annual revenue to off-set their budget issues, as opposed to a one-time cash flow infusion at the sale or the disposition of a particular asset.