As companies return to the office, many execs are faced with the daunting task of determining what if any changes to make to their office attendance strategy: What is our permanent remote work policy? How do we motivate employees to come into the office? Should we move to unassigned seating? Will we need to redesign […]
James Gorman, the Morgan Stanley CEO, “We’ve proven we can operate with no footprint. That tells you an enormous amount about where people need to be physically.” Our business relationship with office space radically changed over the last year. Here are questions being debated internally by almost every office-based firm: What changes are permanent and […]
Many firms are struggling with the culture shift that has occurred within their firm regarding remote work. There are numerous very well conducted surveys, including this one by PwC, that conclusively state that employees overwhelmingly prefer some remote work as part of their routine. Even pre-pandemic, CNBC, Hillarys, and others published surveys indicating that a […]
As more companies shed excess office space, we’re seeing forward-thinking CFO’s leading the charge. In the latest FL Institute of CFO’s survey with over 100 CFO’s of firms over $50MM responding, 43% expect to reduce office expenses in 2021 and 50% expect office costs to be flat. That places office expense reductions just behind corporate […]
Robots are to Warehouses as Zoom is to Office Meetings. Covid accelerated both the shift to remote work for office work and the shift to robotics for warehouse work. Robots don’t need social distancing protocols, can’t get sick or spread a virus, and certainly don’t have to home school their kids. If you’re not yet […]
Work From Home or Work From Office is not an all or nothing premise. We can do both and also work from the local coffee shop or coworking facility. Let’s stop the polarized contention that people either hate working from home or love it. It doesn’t matter any one individual’s preference. What matters is that, […]
You pay for warehouse space by the square foot and use it by the cubic foot. Spalding Sports is the largest producer of basketballs in the world. They sought our help when they ran out of warehouse space in their Reno west coast distribution center. At the time, Spalding had 157,000 SQFT of space and […]
If your business is industrial distribution, Amazon is either your biggest customer or your biggest competitor. If it’s the former, congratulations on having a great year in 2020. If it’s the latter, you might feel like you’re playing hide and seek in the jungle with Navy Seal Team 6 using live ammo. You could survive, […]
Companies often tell us that their space use is 180/SQFT (or similar) per person. Well it almost certainly is not. And it was not before Covid, either, but their Space Utilization Metric is broken. They may have laid out their space at 180/SQFT per seat, but their staff level is very likely something less than […]
In three separate incidents that I’ve witnessed, move out condition has become an important and major financial negotiation. Two of the cases involved clients moving out of a property and debate over the “reasonable wear and tear” condition of the premises on vacating. The other issue was over a proposed new lease with a rider […]
We located a building that had four vacant floors of about 25,000 SQFT each and made the landlord the following offer: The landlord would agree to have an entire floor painted and carpeted, and my client would lease just 5,000 SQFT with an option to take additional space at the same rent and a first right of refusal if the landlord found another user for the balance. Further, rather than put up a demising wall
Office market demand has fallen by more than half over this time just one year ago, and rates have remained somewhat flat. Look at this chart comparing Office Market Rent to Occupancy: Source: CoStar Group www.costar.com There has developed a significant spread between “bid” and “ask”. Unfortunately for many corporate office tenants, understanding the true […]
Are you delaying making decisions on an approaching lease expiration? Many firms are, especially if they have a plan to simply renew in place. This can be a mistake. That decision delay is fine as long as you protect your negotiation leverage. How? Delay the renew/relocate decision, but not the renew/relocate actions. The chart below […]
“We’ve proven we can operate with no footprint. That tells you an enormous amount about where people need to be physically.” – James Gorman, CEO, Morgan Stanley ——————- So your firm has realized that it can work differently than in the past. What’s the right process to reduce your footprint? Here’s a plan to follow. […]
Newton’s First Law of Inertia: An object at rest tends to stay at rest. A Landlord’s First Law of Inertia: A tenant in place is likely to renew. How likely? It is hard to find precise data although many Real Estate Investment Trusts report that in excess of 80% of their commercial portfolios renew. With […]
Nearly every office worker worldwide has taken part in a forced remote work exercise. Incredibly and perhaps surprisingly, we’ve passed with flying colors and demonstrated our ability to adapt to a non-office environment. The experiment is not over. We’ve learned some things, but not everything. We’re finding a significant portion of companies are wrestling with […]
If you go into the grocer and purchase, for example, three pounds of salmon, you can be relatively certain that you now possess three pounds of salmon. However, if you lease 30,000 SQFT of space in an office building, can you be relatively certain that you possess 30,000 SQFT? Absolutely not. Here’s why: To start, […]
There are many hurdles for getting staff back to work. Here’s our LeasingBetter C19 Workplace Checklist of best practices to help simplify your process. Feel free to download and/or print it out if you find it useful. Also be sure to keep checking the CDC Employer Information for Office Buildings for the most recent updates.
There was a time when some people believed that it was physically impossible to run a mile in less than four minutes. Not just difficult, impossible. After Roger Bannister did it, within a year, three runners broke the four-minute barrier in a single race. Since then, more than a thousand runners have conquered a […]
It’s only when the tide goes out that you learn who has been swimming naked. – Warren Buffett As I write this, COVID-19 has about 80,800 confirmed cases worldwide and 1,323 in the US. The operative word there is “confirmed” since by reason there will be many thousands that are unconfirmed and undetected. The virus […]
Your company signed a lease for office or perhaps warehouse space a few years ago and you’re now somewhere in the middle of the term. You can relax for a few more years, right? Wrong. Not if you want to make sure that you are staying ahead of the game. Here are three things […]
The City of London realized, shortly after WWII that they would need a new airport, now known as Heathrow. The job of determining the location was entrusted to Alfred Critchley, a successful businessman. Consider the many criteria that must be considered when choosing the location for a major airport: Transportation access, proximity to […]
It is a great time to be a tenant, and here is another example. Because almost all options are written with the assumption that rates will climb forever upwards, we’re seeing some interesting effects as rental rates tumble. Some options are literally not worth the paper they we’re written on. However, declining markets have made some usually unattractive renewal options have new value. Here’s why:
One of the great embarrassments to the FL Economic Development folks, who try to lure businesses to relocate to sunny Florida, is that we are the only state to apply sales tax to commercial real estate leases. (Note that some other states have excise or gross receipts tax that may count revenue from […]
If you expect to get a fair and competitive rental rate and terms on your renewal, you need to start early and have a process. Your Landlord is a professional. They probably have also hired an expensive real estate leasing company and have a $500/hour commercial real estate attorney. This is serious business. Even […]
A sophisticated landlord can sense a bluff the way a pitbull can sense fear. It’s not that landlords are bad guys (or pitbulls – my apologies to offended landlords or pitbull owners), it’s just that it is their JOB to maximize return to their investors.
One of the easiest and most effective ways for a corporation to keep real estate costs low is to regularly perform Market Rate Audits on their leased locations. Often many companies get caught up in reactionary tasks such as simply handling leases as they come up for expiration, so they never get ahead of the […]
If your lease is silent on the subject, most States provide that a landlord can charge double rent during a holdover period. Many commercial leases address this issue and specify some increased rent penalty from between 125% (if you negotiated it up front) to 200%. In addition, since rent is paid monthly, you are obligated to pay for the entire month
Your company has multiple leases for office or industrial space. You’re represented by a Big 5 Landlord Rep firm, and it’s not working out so well. You’re under pressure to improve it, along with a hundred other things that need improved. So you plan to create an RFP for RE services. I […]
I took this photo of Mick Jagger when I was a photojournalism major at the University of South Florida. It made the cover of a small time music magazine, and I had visions of eventually getting my work on the cover of Rolling Stone. Just like the song. Around the same time, I […]
