Q&A: Monday Properties’ Cliff Cummings Dissects DC’s Office Market
Monday Properties, the landlord behind D.C.-area offices like Shirlington Tower and 1000 Wilson Boulevard, has recently added Cliff Cummings to its roster of top execs.
In his new role as vice president of investments, Cummings will lead acquisitions for the firm’s office platform. The job will entail selecting and closing new acquisitions, building value in current assets, and developing new and existing capital relationships.
With more than a dozen years of real estate investment, development, and acquisitions experience, Cummings comes to the firm from Newmark, where he executed close to $2.5 billion in institutional real estate transactions. Prior to that, he held roles at Monument Realty and W3 Partners.
Commercial Observer spoke with Cummings about his outlook for office in 2021, what he’s looking forward to in his new role, and what’s next for Monday Properties in this space.
Commercial Observer: What led you to Monday Properties? Why were you interested in the role?
Cliff Cummings: I first encountered Monday Properties in 2012 as a potential [joint venture] partner for two deals I executed during my first acquisitions role in the San Francisco Bay area. In 2014, I moved to Washington, D.C., and worked in development acquisitions, pursuing office and residential development opportunities in the D.C. metro area, including Rosslyn and the surrounding submarkets. It was then that I became more familiar with Monday Properties and very aware of their impressive office portfolio in Rosslyn.
In 2017, I decided to make the move to a brokerage and joined the Newmark investment sales team, where we worked directly with Monday Properties in multiple transactions they pursued and executed with several new equity partnerships. I admired the Monday team’s professionalism, their ability to develop strong equity relationships with institutional partners, and their entrepreneurial style. After such a long track record of interactions with Monday, I was confident this was the right opportunity when I was approached to lead the commercial office acquisitions efforts.
How has your experience prepared you for this opportunity?
My last three roles were critical in rounding out my skill set to prepare me for this opportunity at Monday Properties. Those roles ranged from leading acquisitions for a large institutional client on the West Coast, to raising JV partnership equity and pursuing redevelopments, ground-up developments, and entitlement opportunities throughout the D.C. metro area. Most recently, my role included building and expanding a strong network of owners, investors, peers, and leasing brokers during my time in investment sales. I was lucky to have great mentors and support in each of these roles, and I’m grateful for the guidance and leadership I received along the way.
What are your initial goals in the job?
My initial goals are to leverage my recent experiences and network to expand our equity relationships to pursue all opportunities we feel strongly about. This will generate unique opportunities to work directly with owners in the marketplace, rather than solely relying on broadly marketed sales opportunities.
How would you characterize the office market in the D.C. region in 2021?
During the COVID-19 pandemic, the D.C. region proved, once again, that it has one of the most resilient economies in the country compared with the other top-tier markets. While the market experienced a pullback, like most others in the U.S. during the pandemic, inflating vacancy rates to new market highs in some submarkets, we’re already starting to see leasing and capital markets trends reversing that momentum throughout the region.
Tenants are showing renewed confidence to commit to office space, recognizing it as a critical requirement for their company’s continued growth and success. The vaccine is creating a new sense of security and confidence that continues to drive leasing and investment momentum throughout the D.C. metro area. Northern Virginia has seen the most activity throughout the pandemic with its strong technology and government contracting industries, and parts of suburban Maryland have seen unprecedented demand for life sciences and lab space.
Our region has the most highly educated labor market, and it has seen historically significant growth in young, tech talent in recent years, because of the numerous, high-paying job opportunities and high-quality places to live in the region. We’re excited for what’s to come, and we’re looking forward to meeting our current and future tenants’ shifting needs.
What impact did the pandemic have on the market?
The pandemic shifted the way people think about the office and what people use the office for. Flexibility has been the key theme, and tenants are trying to do what’s best for their company and its employees. Some tenants are requesting more mixed-used space; others feel they need more space than ever to keep up with social distancing requirements to help their employees feel safe.
D.C., Northern Virginia, and suburban Maryland combine to form a massive, bustling metropolis, and the pandemic had a marked impact on that exciting urban activity. For a while, a loss in energy was felt throughout the region as less people came into the physical office, restaurants, or retail spaces. We can see that starting to pick up again with more and more people returning to the office. Vaccine availability couldn’t have come at a better time with the weather getting warmer and more people wanting to socialize or exercise outside. Restaurants and retailers have done an exceptional job at creatively finding ways to serve their customers. There are still many questions to tackle, but I am confident the region will get back to a sense of normalcy soon.
How are you preparing an investment strategy for the year ahead, based on what you’ve seen over the past year?
In the near term, I am focused on developing a strategy around the “First Movers,” referring to the submarkets that are going to benefit most from the first waves of pent-up leasing demand as the market returns to work. The D.C. metro area is the dominant cloud computing, government contracting, and cybersecurity market, and one of the top life science markets in the United States. These industries saw extraordinary growth during the pandemic, and I strongly feel that, given the demographic and technology infrastructure advantages in the region, these industries will be a consistent driver of our investment strategy throughout the marketplace in the years to come.
What are your expectations on what’s ahead in the office market overall?
I think employers are going to do what’s best for their employees. Overall, while a small percentage of tenants are looking to shrink their square footage, three-quarters have no plans to do so. While there may be more flexibility to work from home some days, companies and employees still want space to collaborate and learn from each other. They need a central place to host meetings and retreats. People have spent too long working from home — I expect people are ready to come back to the office and socialize. I’m looking forward to new ways we can help tenants lay out their office for the best collaboration possible.
What can you forecast about Monday Properties in this space coming up?
Monday Properties is on an upward-growth trajectory, and I’m thrilled to join the team during such an exciting time. We have a diverse portfolio of properties and continue to invest in desirable communities that we feel strongly will recover quickly from the pandemic, including recent acquisitions in Shirlington, Rosslyn, Alexandria, the Dulles Toll Road, and multifamily acquisitions in Charleston and Stamford, Conn. We are optimistic about the future and have embraced change by working closely with industry experts, our tenants, and partners to proactively execute on new initiatives that benefit the greater good. Our number one priority continues to be the safety and well-being of our tenants, employees, and community, and we believe the health and wellness investments that we’ve made over the past several months will prepare us well for success in the coming years.