🗞️ Behind the collapse of NAR’s big vision for brokers | Inside the February 2024 Issue

Inside the latest issue of The Real Deal Feb 01, 2024 [View in Browser]( [Share](   [Magazine Cover Image]( Real estate trade groups seem old-school and obsolete these days. Shooting themselves in the foot doesn’t help their dwindling clout. That’s what the National Association of Realtors seems to have done. There was the bombshell commission case that NAR lost (with billions in damages on the line), allegations of sexual misconduct at the organization, a revolving door of top brass, and the latest head stepping down over blackmail threats (we still don’t know what that is all about). Not to mention a loss of membership for the nation’s largest trade organization (1.5 million members), which is supposed to be the heaviest hitter fighting for the real estate industry’s interests. NAR these days looks a lot like the NRA, minus Wayne LaPierre. Reporter [Sheridan Wall]( gets into the rise and fall of NAR in our February magazine’s [cover story](. Some of it is sordid stuff, but the reporting speaks to the broader problem with real estate trade groups these days. Basically, they are operating like dinosaurs — old-school, ineffectual and flirting with extinction. In New York, the industry has been taking punches for five years: The [rent regulation reform]( of 2019 gave tenants a lot more power, some left-leaning politicians began declining industry campaign contributions and the governor and mayor stopped showing up at real estate events. Having a developer in the White House at the time probably didn’t help. New York’s most powerful real estate trade group, the Real Estate Board of New York, was caught flat-footed at the time, and its clout has never fully recovered. Gov. Hochul and Mayor Adams want to build more housing these days, but REBNY can make little headway. It’s not an easy job, but the group seems more used to backroom dealing and lobbying in an age that demands savvy on social media. (The group needs to hire some interns who know their way around TikTok.) Meanwhile, New York landlord groups RSA and CHIP are [merging]( in an attempt to be more effective and shake things up. In Los Angeles, the [transfer tax]( approved by voters surprised the industry. The tax has brought the luxury market there [to a crawl]( because it adds a 4 percent charge to the sale of every home above $5 million. There was little awareness of the measure before it was approved, and not much significant mobilized opposition, including from NAR. It’s now being fought in the courts. Chicago, too, is facing a version of the “[mansion tax](,” mislabeled because it applies to development sites and commercial real estate as well, not great at a time when the commercial real estate market there needs all the help it can get. No wonder real estate players like Mauricio Umansky and Jason Haber are taking matters into their own hands by starting a trade group to rival NAR. Finally, San Francisco, which fell the furthest into the “urban doom loop,” seems to be coming to its senses. More moderate politicians are getting elected there now, thanks to a bit more pragmatism. See [our story about real estate’s efforts to facilitate the political shift](. (By contrast, check out our stories on [building in post-421a New York]( and [waiting for rules to change on office-to-residential conversions]( if you want to get a sense of how hard it is to build in NYC right now.) Elsewhere in the issue, we’ve got great profiles. We have [a story on prominent Los Angeles developer Neil Shekhter](, who just lost 28 buildings to lenders to repay more than $1 billion he owed. We love looking at under-the-radar power players, those who haven’t been written about much considering their massive property holdings and wealth, and Brooklyn developer [Isaac Hager]( fits that bill. Elsewhere, we shed light on the [biggest Middle Eastern investor]( in New York real estate last year, Qatar, no stranger to headlines these days. Finally, on to some glitz and glamor from the luxury home market — check out our Closing interview with L.A.’s top agent (according to our most recent ranking), [Aaron Kirman]( and a survey of [ranch real estate]( for Texas’ richest roughnecks. Included in this print issue if you are a subscriber, we’ve got our 2024 Data Book, the annual almanac of real estate data and statistics for all the markets we cover. It’s the most comprehensive take on the market you are going to get in one place. Enjoy the issue! Editor's Note Stuart Elliott Editor-in-Chief & CEO   If you’re interested in receiving future magazine issues in print, sign up for our [annual subscription](. Save $50 OFF all our subscriptions with promo code: REAL50 [SUBSCRIBE NOW](   [Behind the collapse of NAR’s big vision for brokers]( The National Association of Realtors was a “gift of vision.” Or so William North wrote in 1978, just a few years after the organization took on its modern form and ahead of the decades he would spend steering NAR in its ascension to the largest trade group in the country by membership. Though the code still governs NAR and the trade group has repeatedly reasserted its inherent mission, critics say its most recent generation of leaders hasn’t held up its end of the bargain. As NAR’s problems stack up, members are casting doubt on the group’s reign atop the industry — adding internal pressure that for the first time matches scrutiny from regulators. [READ MORE](   [Image]( [The $45B pledge: Qatar keeps buying Manhattan’s “best locations and best assets”]( In 2023, Qatar was the top foreign investor in New York City, pouring in $1 billion. Qatar is a small state on the Persian Gulf, founded in 1971 shortly after the British withdrew from the region. Now, a small group from the peninsula nation are buying up trophy assets and acquiring political influence across Manhattan. [Image]( [How Neil Shekhter lost half his portfolio]( Neil Shekhter once held some of the most coveted land in the U.S. He had apartments in Santa Monica and Beverly Grove, where one-bedroom units now average nearly $4,000 a month. And he owned land in Santa Monica that Tishman Speyer, the New York investment giant that counts Rockefeller Center among its holdings, paid more than $18 million an acre to buy. Now, most of what he had is gone. [Image]( [Student housing: real estate’s unlikely kingmaker]( Student housing has become real estate’s unlikely kingmaker, emerging over the past two decades as a recession-proof cash cow and a reliable asset at a time when multifamily and commercial are unappealing. Everyone wants these apartments. Developers want to build them. Banks want to finance them. Students want to live in them. And universities, whose ever-growing enrollments far outstrip their ability to house students, need them. [Image]( [Isaac Hager, Brooklyn’s most mysterious dealmaker, is back]( Eight years ago, Isaac Hager was no one. At least according to him. Today, Hager is facing foreclosure on the cornerstone of his portfolio, 200 Kent Avenue, anchored by Trader Joe’s. He could just disappear and go back into being no one. But Hager is making an unlikely comeback. He’s buying distressed real estate in Crown Heights, smaller sites in Rockland County and a 500-unit multifamily portfolio in the mid-Atlantic region, according to sources and property records. [Image]( [The luxury ranch brokers fueling Texas’ land boom]( Though Texas has some of the fastest-growing cities in the country, there is no high-end real estate more Texan than a luxury ranch. The brokers selling those properties for tens, or even hundreds, of millions of dollars are not just playing in a fancy local market: They’re shepherding ranches into the future, as Texas’ urbanizing economy makes owning land more valuable — and more complicated — than ever before.   [The Closing: Aaron Kirman]( INTERVIEWS WITH REAL ESTATE TITANS   [Image]( LA’s top residential broker talks about overcoming dyslexia, avoiding "commission breath" and breaking into real estate by breaking (and entering) into mansions. Los Angeles’ top residential broker cuts a casual figure, but wants you to know things are getting serious with his new venture. Aaron Kirman, who’s known for spinning trophy properties while sporting T-shirts and jeans, made headlines in late 2022 with news that he was establishing his own brokerage in partnership with AKG Christie’s International Real Estate. “We’ve just begun,” said Kirman, who topped The Real Deal’s 2023 rankings with $1.1 billion in on-market sales. 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