Marc Singer, Co-founder of Singer Xenos Wealth Management in Coral Gables. Courtesy photo
In light of all the attention being paid to hurricane season, climate change and rising sea levels are increasingly on the minds of everyone — including commercial real estate people.
As co-founder of Singer Xenos Wealth Management in Coral Gables, Marc Singer has helped hundreds of families create financial security and wealth. He also founded and heads the Advisor Forum, which manages over $9 billion in assets. He has some thoughts on the consequences of climate change. His comments have been edited for length and clarity.
Recent studies like one from Harvard University deal with how climate change could impact the general housing market. How much of a threat is it to the commercial market, and how do you counsel clients?
Just like the threat climate change poses to the general housing market, the impact it will have on our commercial market is both real and substantial. If you own commercial property, like a rental building, it’s always a good idea to begin reducing your exposure to vulnerable assets over time, especially in South Florida — ground zero for climate change and sea level rise. To be clear, we are not advising against investing in Miami or coastal cities altogether, but to do so in a way that can safeguard your portfolio and limit your exposure to vulnerable real estate assets.
For example, if you own multiple warehouses or hotels in South Florida, consider exploring how new opportunities outside the region may benefit your bottom line, too, where you’re less likely to deal with complications of sea level rise. You have years to lower your risk, but start the process now, and slowly move some away from the area over time so your assets truly become better protected.
Some skeptics have questioned how severe or imminent is the threat of climate change. We can’t get into a detailed description but can you name the single factor or two that are compelling arguments to take the issue seriously, and how local officials are responding to it?
Global warming, climate change and sea level rise are global issues and their effects are far-reaching. It is a very real issue, and it should be taken very seriously. Here in Miami, a 2016 University of Miami study found that before 2006, the average annual rate of sea level rise was about 3mm. After 2006, this rate jumped to 9mm a year.
Just take a look at how Miami’s public and private sectors are approaching climate change and sea level rise. The City of Miami, Miami Beach and Miami-Dade County resiliency officers are, together, creating a master plan to identify areas of critical need and potential solutions. For example, Miami Beach is spending $500 million to elevate more than 100 miles of roads, install dozens of pumps, build higher sea walls and improve drainage systems. And Miami voters passed a $400 million general obligation bond in 2017 with half that sum earmarked for combating sea level rise and protecting against stronger storms. Additionally, academic institutions, like the University of Miami and Florida International University, are all studying climate change and its potential impacts closely while identifying innovative ways to mitigate it.