A group of Charlotte commercial real estate executives at a 2017 market forecast slammed House Bill 2 on Tuesday, saying the controversial law limiting LGBT protections is driving away potential investors and tenants.
“It’s idiotic, and it needs to go away,” said Wyatt Dixon, managing principal at apartment developer Proffitt Dixon. He said an investor on an undisclosed deal recently got as far as giving them a term sheet before declaring “We’re out” after HB2 passed and backlash began.
None of the real estate executives at the Bisnow forecast said HB2 is completely destroying the city’s momentum, and key market segments such as apartments and office space are expected to keep growing in Charlotte. But the executives on two separate panels all agreed HB2 is hurting the state and making their jobs harder.
“We’ve lost an intangible,” said Jensie Teague, of Selwyn Property Group. He said Charlotte now compares less favorably with peer cities such as Austin and Nashville. “We need to get that back.”
Digital Access for only $0.99
For the most comprehensive local coverage, subscribe today.
The legislature passed HB2 last year in response to a Charlotte ordinance expanding nondiscrimination protections for LGBT individuals and allowing transgender people to use the bathroom of the gender with which they identify. The state bill blocked local protections for LGBT people and mandated transgender people use the bathroom corresponding to their birth certificate in public buildings.
In response, artists such as Bruce Springsteen boycotted North Carolina, and companies including PayPal and CoStar Group canceled planned expansions in Charlotte. A deal to repeal the bill fell apart in December amidst bitter partisan fighting, though Gov. Roy Cooper said this week that he’s in talks with legislative leaders to work out a new way to repeal HB2.
“No matter what side you’re on, it’s just got to be repealed,” said Jason LaBonte, senior vice president at Crescent Communities. He said a global investment bank Crescent was working with on funding for a deal recently spent five minutes in a meeting talking about the deal and 25 minutes talking about the potential ongoing negative impact of HB2.
Jonathan Nance, senior vice president of investments at Grubb Properties, said the law makes it harder to raise capital.
“That’s something we’ve got to repeal,” he said of HB2. “We’ve got investors who will not look at Charlotte or North Carolina.”
On Monday, North Carolina Gov. Roy Cooper said that he sees an opening for another possible deal with legislative leaders to repeal the bill. Speaking at a Martin Luther King Jr. holiday breakfast in Charlotte, the Democratic governor said he has been talking with GOP Senate leader Phil Berger and House Speaker Tim Moore since their last proposed deal collapsed in December.