ROCHESTER AREA CHAPTER NYSCAR QUARTERLY NEWSLETTER END OF YEAR MESSAGE FROM OUR RAC NYSCAR PRESIDENT

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1 DECEMBER 2017 VOLUME 9 ISSUE 4 ROCHESTER AREA CHAPTER NYSCAR QUARTERLY NEWSLETTER END OF YEAR MESSAGE FROM OUR RAC NYSCAR PRESIDENT From the Desk of Joseph F. Rowley, Jr., 2017 RAC NYSCAR President: This year of 2017 is nearly done, seeming to fly by quickly. There have been many major real estate stories in Rochester, with Chapter Meetings hosted by the developers that are making the news exciting: DHD Ventures, Gallina Development, Uniland Development, Flaum Management, Morgan Communities, Buckingham Properties, LLD Enterprises and WinnDevelopment. Many thanks to these companies for their hospitality and for making Rochester a great place to work in the Commercial Real Estate Profession. We kicked off the year with a talk from Robert Duffy, the President of the Greater Rochester Chamber of Commerce, and had a great turnout for our Golf Event in July, more than doubling the count from last year, due in large part to the NAIOP members joining us. We also toured Three City Center after a presentation by CBRE and the new owners, Pete Landers, Bob Morgan and Rob Sands. Kodak hosted the Chapter at the newly revamped Kodak Center for a market review, and in December, a networking cocktail reception with Greater Rochester Area Realtors was held at Sibley Square. The annual President's Dinner and Awards Banquet was held at the recently renovated Hyatt Regency Rochester, a great way to celebrate the successes of Have a safe and happy Holiday Season and a Happy New Year!!! 2018 RAC NYSCAR KICK-OFF IS JANUARY 18 MAYOR LOVELY WARREN IS OUR KEYNOTE SPEAKER The Rochester Area Chapter is very excited to be starting our Kick-Off to 2018 on Thursday, January 18, 2018, with our keynote speaker, Rochester Mayor Lovely Warren, with a special presentation by Eric Van Dusen, Senior Economic Development Specialist at the City of Rochester. Our Kick-Off will take place at the Strong Museum of Play, located at One Manhattan Square Drive, Rochester, NY Sponsors include the development team of Indus Hospitality Group and Konar Properties. Steve M. Dubnik, President & CEO of The Strong, will be doing a short presentation of the Neighborhood of Play. Remember, guests are always welcomed to attend our events.

2 REFLECTIONS, OPPORTUNTIES AND BENEFITS From the Desk of Mercedes R. Brien, 2017 RAC NYSCAR Vice President: As I step down from several years as a RAC NYSCAR Board member and Officer, I wanted to take this opportunity to express my gratitude to RAC NYSCAR. If I had not volunteered to be on the Membership Committee back in 1999, I truly believe my Commercial Real Estate career would have been a whole different experience. Through NYSCAR, I formed lifetime relationships and have had mentors that, to this day, support me. Through NYSCAR, I have been educated formerly in the classroom but also in economic development, marketing, diplomacy, politics, negotiations, etc. The exposure I have received has been invaluable. Most importantly being involved has given me the opportunity to be a part of something that positively affects many others. I cannot express enough the benefits of volunteering. I urge all RAC NYSCAR members to get involved. I promise you will not regret it. I have accepted a position on the Board of Governors at the State level in I welcome any comments or concerns that I can take to the State to make positive changes and create new benefits for all our members to enjoy. Benefits like our RAC NYSCAR Scholarship Program that was created several years ago with the Glazer Memorial Fund to support Commercial Real Estate Education. There is still time to apply for the 2017 calendar year. To be considered for a 2017 scholarship, please submit all required paperwork no later than 5:00 pm, Friday, December 29. Eligibility requirements can be found on our website. Lastly, I wish all a wonderful 2017 holiday season and a very prosperous 2018! INTERESTED IN HOSTING AN RAC NYSCAR EVENT IN 2018? We still have some dates open for hosting in Contact Chris Passero at (585) or at CPassero@passero.com. 17TH ANNUAL PRESIDENT'S DINNER AND AWARDS BANQUET ON NOVEMBER 16, 2017 ENJOYED BY ALL! Almost 80 RAC NYSCAR members and guests celebrated the finest in our Commercial Real Estate community this year at the Hyatt Regency Rochester Ballroom. Our sponsors were CBRE Rochester, CoStar Group, FSB Realty Services, Harris Beach, Passero Associates, Spectrum Business, SVN Realty Performance Advisors and The Rose Hill Group of WNY Ltd. Gary W. Passero of Passero Associates was honored with the Allan D. Moore Lifetime Achievement Award for his exemplary achievements, personal commitment, dedication and performance in the Commercial Real Estate industry in the Rochester community. Our Commercial Realtor the Year award went to Terrance K. Bromley of FSB Realty Services, for having demonstrated excellence in the Commercial Real Estate profession. Joseph F. Rowley, Jr., and Joseph L. Rowley III, both of SVN Realty Performance Advisors, received the Deal of the Year-Sale award. The Deal of the Year-Lease award went to Courtney Janto of Buckingham Properties and Jaymes Keenan of CBRE Rochester. Both Steve Conger from Spectrum Business and John Rynne received Meritorious Service awards. Our Best New Talent award went to Alex Amorese from CBRE Rochester. Geoffrey Cook from Taylor-The Builders was the

3 recipient of our first-ever Affiliate of the Year award. Geoff was unable to attend; Jillian Coffey accepted on his behalf. RAC NYSCAR WELCOMES TWO NEW BOARD MEMBERS AND SAYS FAREWELL TO TWO VETERAN BOARD MEMBERS 2018 RAC NYSCAR Board of Directors The RAC NYSCAR Broker membership voted in our two new 2018 Board Directors, Kevin Bromley from FSB Realty Services, and Eric Whitlock from HUNT Commercial Real Estate. We said a fond good bye and a BIG THANK YOU to two of our long-serving Board members, John Rynne, MAI, of Rynne, Murphy & Associates and Mercedes Brien of Mission Commercial Realty, LLC. BROKER INVITATIONAL WILL CONTINUE IN 2018 Our grand prize winner of the 2017 Broker Invitational was Joe Rowley, Jr., from SVN/Realty Performance Advisors! Joe's name was drawn at our President's Dinner and will have his 2018 dues paid in full by the Rochester Area Chapter. Read on to see how you can be eligible for The Broker Invitational will be continued in Bring a different Broker guest or colleague to our events and receive an entry or entries into the drawing to take place at the next President's Dinner. See details below. Details for Participation: Invite a Broker to a meeting and receive one entry for a drawing for Free Dues for One entry per individual guest (even if they attend more than once as a guest). You must register your Broker guest at the event with our RAC NYSCAR Admin, Caroline Rohlin, for your entry to be counted. If that Broker guest joins RAC NYSCAR, then the inviting member will get two additional entries into the drawing. The winner will be drawn at the November 16, 2017 President's Dinner. Affiliates and Broker members in good standing are invited to participate; however, entries are only valid for a Broker guest. For questions, please contact me at harry.gleason@cbrerochester.com or at Please be respectful of our Guest Policy. Guests are limited to two (2) visits before becoming members.

4 After two visits, that guest either may join as an RAC NYSCAR member by paying dues to receive all the benefits of membership or they may no longer attend. GOVERNMENTAL AFFAIRS REPORT From the Desk of John P. Rynne, MAI, RAC NYSCAR Governmental Affairs Chair: One of the biggest concerns in Governmental Affairs is the national issue of the tax reform bill. Both National Association of Realtors (NAR) and the New York State Association of Realtors (NYSAR) are adamantly against part of the tax reform bill and in favor of much of the remainder proposed by both the House of Representatives (House) and the Senate. A conference committee has been set up between the House and the Senate bills to compromise by December 15, and at the latest, December 22 for the President to sign. NAR estimates that if some of the provisions of the bill are put in place, there will be a 10% decrease in single-family residential values in the United States. States such as New York, California and New Jersey, which are highly taxed, will feel the worst impact. Low tax states such as Florida, Alabama, Nebraska, etc., will probably benefit from the bill, but the overall impact is a 10% decrease in overall single-family property values according to NAR. Other negative impacts of the bill include the mortgage interest deduction, which is currently at a $1M ceiling. The new bill proposes that amount will be reduced to $500,000 for new mortgages. The state and local tax (SALT) deduction is at risk. The House version eliminates the SALT deduction 100%. The Senate version has a $10,000 deduction protection ceiling. This level will protect low-income and many middleincome homeowners. Another aspect of the bill is that the standard deduction will be increased to $24,000. That will make it more difficult to itemize taxes for many low- and middle-income households. There will be limits on the exemption of capital gains tax from the sale of a primary residence from 2 years of residency out of 5 years ownership to 5 years of residency over an 8-year ownership period. According to NAR, this will increase the negative effect from 4% of homeowners to 12-22% of homeowners. Also, the bill will eliminate second home deductions unless it is a rental unit. There will be an elimination of the deduction for moving expenses, interest on student loans, medical expenses, alimony expenses and gambling losses. This part of the bill, reportedly, will benefit single persons with no children who rent and are high income earners. On a positive note, the corporate tax cut will be 35% to 20-22%, but in the House version, it will not encompass the Sub-Chapter S Corporations. However, it will benefit large and medium corporations. Reportedly, the Senate bill will encompass S corporations on some basis. S corporations represent millions of small companies. Thus, the Senate bill has a provision, which will encompass S corporations who could also benefit, including many small and medium size businesses. Another National issue for NAR is Net Neutrality, which was established during the Obama Administration through the Federal Communications Commission (FCC). This regulation gave more equal access and rates across the board. The Trump Administration wants to repeal this because it represents too much government control on prices, which discourages market competition and innovation. However, NAR is in favor of keeping net neutrality. The National Flood Insurance Program (NFIP) was set to expire at the end of September. It has been temporarily extended to December 8, 2017, and more recently, has been extended to December 22, 2017, along with the Continuing Resolution (CR), which is a stop gap measure to keep the government fully funded since there is no agreement on a final budget. The NFIP program did pass the House, but the Senate has not passed it yet. This will insert more private insurance into the system along with other reforms and should decrease flood hazard insurance rates. Previously, the rates and insurance were essentially through the Federal government. As was previously reported, Waters of the United States (WOTUS), an EPA regulation, was partly reversed by the Trump Executive Order on February 28, It was put into the Federal Register on July 27, 2017 to replace the burdensome 2015 EPA/Army Corp. of Engineers Regulation. WOTUS reportedly will cover only wetlands and waterways with a surface connection to navigable waters. There is interest in exempting surface connections to small navigable water ways. The New York State Association of Realtors (NYSAR) has a number of issues. There is the first-time home

5 buyers legislation that has passed both in the NYS assembly and the NYS Senate and is waiting for the Governor's signature. This will give a tax deduction to singles at $5,000 and couples at $10,000 for firsttime homeowners or home buyers. This has to be signed by the Governor this week, or by December 15. Lobby Day is scheduled in Albany for many New York State issues, which will be discussed in later newsletters in In summary, hopefully the House and Senate final version of the tax reform bill will maximize benefits to property owners and all tax payers. Remember to stay involved and informed, so property rights can continued to be bolstered as one of our most important freedoms. Rochester Area Chapter NYSCAR admin@rochesternyscar.com (585) Please feel free to forward our newsletter to any professional in the Commercial Real Estate community. New members are welcomed and encouraged. Copyright All Rights Reserved.