2022 Roundtable Annual Meeting

Inflation, National Policy Agenda, and CRE Market Conditions Focus of Roundtable Annual Meeting

2022 Real Estate Roundtable Annual Meeting Audience

The Roundtable’s 2022 Annual Meeting in Washington, DC this week focused on key policy issues affecting the commercial real estate industry—including inflation and interest rates; prospects for a scaled-back Build Back Better (BBB) Act; proposed climate risk disclosure rules; and a new industry Equity, Diversity, and Inclusion initiative.

Policy Focus

DeBoer and Manchin at 2022 Roundtable Annual Meeting
  • Roundtable President and CEO Jeffrey D. DeBoer, left, launched the June 16 business meeting with an overview of The Roundtable’s Policy Agenda and newly released 2022 Annual Report, Building a More Resilient and Dynamic Future. Annual Meeting guests included:

    • Sen. Joe Manchin (D-WV)
      Sen. Manchin, above right, discussed the benefits of a bipartisan approach to legislation and the role of inflation in considering any additional spending bills this year.

    • Sen. John Thune (R-SD)
      Sen. Thune spoke about supply chain issues, aid for Ukraine, the Fed and monetary policy, and the upcoming elections.

    • Rep. Abigail Spanberger (D-VA)
      Rep. Spanberger addressed efforts to produce common-sense gun policy, lower inflationary costs for families and policymaking in the House during the upcoming lame duck session.

    • Jim VandeHei

      Axios and Politico co-founder and CEO discussed the current political environment, potential challengers to President Biden, the upcoming congressional elections, and the advantages of delivering news and analysis about today’s policy landscape in an efficient, “smart brevity” style.

    • Jonathan Karl

      ABC New’s Chief Washington Correspondent spoke about the current political environment and the midterm elections.

Supplier Diversity & CRE

Rock Irvin, Chief Commercial Officer, SupplierGATEWAY (left) and Adenuga Solaru Chief Executive Officer (right)
  • The Annual Meeting also included an initiative of The Roundtable’s Equity, Diversity, and Inclusion (ED&I) Committee, chaired by Jeff T. Blau (Chief Executive Officer and a partner of Related Companies).

  • A proposed two-year pilot program was discussed with SupplierGATEWAY—a firm that assists companies interested in hiring Minority- and Women-Business Enterprises (MWBEs) as contractors, service providers, JV partners, and other “vendors” in their “supply chains.” (Photo: SupplierGATEWAY's Rock Irvin, left, Chief Commercial Officer, with Adenuga Solaru, Chief Executive Officer)

  • The proposed online SupplierGATEWAY portal would support CRE firms interested in accessing a broad and centralized MWBE vendor database, posting hiring opportunities for those contractors, and utilizing tools to assist with corporate ESG reports.

  • SupplierGATEWAY's executives demonstrated a CRE-specific “prototype” of their MWBE management portal that could be available by the fall for companies who may subscribe to the service. 
  • For more information regarding The Roundtable’s supplier diversity initiative, contact Roundtable Senior Vice President and Counsel, Duane Desiderio (ddesiderio@rer.org).

CRE Markets & Policy Advisory Committees

TPAC Meeting at Annual 2022 Meeting
  • The Roundtable’s Policy Advisory Committee leadership discussed their policy issue activities during the business meeting and referred to a Policy Issues Toolkit for background information on how key issues impact commercial real estate (see Executive Summary). Each committee met in conjunction with the Annual Meeting to address the following:  

    • The Sustainability Policy Advisory Committee (SPAC) focused on a recent Securities and Exchange Commission (SEC) proposed rule that would require registered companies to report on climate-related financial risks. The Roundtable submitted a comment letter to the SEC last week on the proposed rules. (Roundtable Weekly, June 10 and Roundtable comments | SPAC Agenda).
    • The Research and Real Estate Capital Policy Advisory Committees (RECPAC) met jointly with Rep. Rep. French Hill (R-AR) to discuss the congressional legislative agenda and capital markets from his perspective as a member of the House Financial Services Committee and Ranking Member of its Subcommittee on Housing, Community Development and Insurance. (Joint RECPAC-Research Agenda)

    • The Tax Policy Advisory Committee (TPAC) drilled down on a Senate proposal to tax unrealized gains associated with appreciated assets, partnership tax rules, like-kind exchanges, Opportunity Zone incentives, and energy-efficiency tax provisions. (TPAC Agenda)

    • The Homeland Security Task Force (HSTF) and Risk Management Working Group (RMWG) met jointly to discuss current threat issues, with presentations by Kevin Vorndran, Deputy Assistant Director, Counterterrorism Division, FBI and Nitin Natarajan, Deputy Director of the Cybersecurity and Infrastructure Security Agency (CISA). (Joint HSTF-RMWG Agenda)

Next on The Roundtable’s calendar is the Sept. 20-21 Fall Meeting (Roundtable-level members only).

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Policy Landscape

Reconciliation Legislation Talks Grind On

Sen. Schumer Senate podium stand

PoliticoPro reported today that Senate Majority Leader Chuck Schumer (D-NY), above, and Sen. Joe Manchin (D-WV) are grinding through talks about a scaled-back reconciliation package that may include provisions on climate, deficit reduction, and prescription drug costs.

Discussions & Deadlines

  • The Senators met twice this week to discuss the contours of a potential trimmed-down alternative to the defunct Build Back Better Act before Sept. 30, when current budget protections for a party-line spending bill expire. (PoliticoPro, June 17)

  • The Senate is scheduled to go on a two-week recess after July 24, then return for four weeks before the August recess.

  • PoliticoPro also reported that Schumer is working with the Senate parliamentarian to pave the way for a possible July or August vote on such a bill. Under reconciliation rules, a legislative package would require majority approval in the evenly divided Senate, as Vice President Kamala Harris could potentially cast a tie-breaking vote.

  • Schumer and House Speaker Nancy Pelosi (D-CA) met with President Biden on Wednesday to discuss “their plans for fighting the global problem of inflation that is affecting every major economy, such as bringing down prescription drug and energy costs…” according to a White House read-out.

  • Pelosi commented after the meeting on negotiations about a reconciliation bill. “It’s alive. I’ll just say that.” (The Hill, June 16)

House Dems Push for Senate Progress

U.S. House of Representatives signage
  • On Thursday, 175 Democrats wrote to President Biden asking him to “reach a deal and sign into law as swiftly as possible a revised reconciliation package that includes the climate investments” previously passed by the House.” (E&E News, June 17)

  • The House Democrats warned “the window to achieve a deal is rapidly closing, and so time is of the essence.”  (CQ, June 16)

  • In May, discussions between Schumer and Manchin were reportedly addressing a pared-down package involving $800 million to $1 trillion in revenue from a new minimum tax on large company profits and increased IRS enforcement. Half of these revenues would go to deficit reduction. (Wall Street Journal, May 28 and Axios, May 27)

The most significant portion of the moribund BBB Act’s proposed spending was focused on climate policies. The Roundtable on Nov. 16, 2021 sent a letter to congressional tax writers detailing five recommendations on green energy tax provisions affecting real estate that were part of the BBB Act. (Roundtable Weekly, Nov. 19, 2021) 

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Tax Policy

Senate Republicans Propose Middle-Class Tax Relief, Financed by SALT Cap Extension

Capitol dome side flag overcast

Congressional Republicans this week proposed legislative measures—aimed at helping middle-class savers and spurring investment without further increasing inflation—as a precursor of GOP economic policies that may be promoted during the fall’s midterm elections. Senate and House announcements on inflation followed last week’s Labor Department report showing the consumer price index reached 8.6 percent in May. In response, the Federal Reserve raised interest rates  by 75 basis points, its largest hike since 1994. (Wall Street Journal and Tax Notes, June 14 | CNBC, June 15) 

Senate GOP Proposal 

  • This week, Sens. Chuck Grassley (R-IA), John Barrasso (R-WY), Steve Daines (R-MT), and James Lankford (R-OK) introduced the Middle-Class Savings and Investment Act.  The legislation aims to help the middle class through tax cuts and savings incentives, paid for by extending the current $10,000 cap on the deduction for state and local taxes. (Sen. Grassley news release, June 14) 
  • The Republican-introduced bill would:

    • Expand the Zero Rate Bracket for Capital Gains and Dividend Income

      The legislation would increase the size of the zero percent tax bracket for long-term capital gains and qualified dividends. Under the proposal, a married couple with income under $178,000 would not owe tax on capital gains and dividend income. 

    • Provide Relief from the Net Investment Tax for a Married Couple

      The legislation would exempt the first $400,000 earned by a married couple from the 3.8 percent net investment income tax that otherwise applies to capital gains, dividends, and passive rental income. Currently, the first $200,000 earned by an individual and $250,000 earned by a married couple is exempt from the tax. 

    • Create and Expand Tax Relief for Interest Income and Retirement Savings

      The legislation would allow individuals to exclude up to $300 ($600 if married) of interest income from taxation. Additionally, the bill would expand the tax credit that encourages low-income taxpayers to contribute to a qualified retirement account. (Backgrounder on the Senate legislation)

  • The bill would be paid for by extending the current $10,000 cap on the deductibility of state and local taxes for three years, or however long is needed. The deduction is scheduled to expire at the end of 2025.  

House Republican Outline 

R Ways and Means Brady graphic
  • On June 14, House Ways and Means Committee Republicans released a one-page document outlining a six-point plan to combat inflation. The GOP calls for repurposing $170 billion in unspent pandemic federal aid for deficit reduction while pursuing permanent tax relief. The list of principles also urges policymakers to reject the Biden administration’s proposed overhaul of the tax code affecting corporations and wealthy individuals. (BGov, June 15)

  • The proposals to fight inflation by congressional Republicans seek to provide a contrast to the approach by Democrats, which includes cutting prescription drug costs and increasing taxes on oil company profits. (PoliticoPro, June 14) 

The Roundtable’s Tax Policy Advisory Committee (TPAC) met today in conjunction with The Roundtable’s 2022 Annual Meeting to discuss policy issues affecting the taxation of commercial real estate. (See story above). 

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