The economic impact of real estate.

Nearly $300 billion in taxes annually; 70 percent of local tax revenues

BOMA International, with its 17,000 members representing six of the world's seven continents, has always played a significant -- and powerful -- role in the commercial real estate industry. In fact, the North American office market comprises some 12 billion square feet of competitive spade -- and by all reasonable estimates, BOMA's membership represents almost 8.6 billion square feet, or over 70 percent, of this total.

In turn, the real estate industry as a whole has a significant impact on the economy -- estimates show that approximately $293 billion in federal, state and local tax revenues is generated annually by real estate and almost 70 percent of all tax revenues raised by local governments come from real property taxes. But how else does the commercial real estate industry impact the economy? To determine that, BOMA International developed The BOMA Office Expenditure Index. And the index showed, quite unmistakably, that the combined financial impact on the economy of all the industries that serve and support the office buildings sector cannot be ignored.

Based upon empirical evidence contained in BOMA's annual Experience Exchange Report and a random sample of owners and their estimated "capital expenditures" for 1998, it was determined that the office sector -- as represented by BOMA members -- accounted for just over $104 billion in the North America' s economy. Real estate taxes, paid by owners alone, accounted for almost $22 billion of The BOMA Office Expenditure Index total.

When broken-down by industry sector, the impact can be seen even more clearly on a line by line basis.

On a local basis, the index can be used to determine the impact of New Jersey commercial real estate market on the state economy (see chart).

Buildings are not simply a place to go to conduct business. The buildings themselves -- and the managers and owners who operate them make business for an enormous number of other industries. It's a powerful industry in which we work -- and one that will only continue to grow in strength and impact as the market and economy expands.

Founded in 1984, The Building Owners and Managers Association of New Jersey consists of over 300 members representing the leading building owners, managers, developers, asset managers, leasing professionals, corporate facility managers and providers of products and services for commercial properties. Internationally, the organization has over 95 associations representing 6 billion square feet of commercial space. BOMA-NJ holds monthly information exchanges and additionally provides continuing education courses through The BOMI Institute.