Posts Tagged ‘ Jeremy Neuer ’

Home Court Advantage

With the NBA Finals starting in a few hours, and the NHL Stanley Cup Finals already underway (LET’S GO RANGERS!), I have been locked in to the playoffs since mid-April.  Last night, I was hoping the Rangers could steal Game 1 on the road and swing the home ice advantage in their favor.

Given all of the talk over the last six weeks about home court and home ice advantage, my partner Matt Wassel and I had an interesting debate recently. The question was, “what’s the real estate equivalent to home court advantage?”

Because we are both sports nuts, we had some fun with the topic, and settled on the following.  A landlord, trying to renew an existing tenant, has home court advantage.  Obviously, if the tenant is shrinking or growing, needs major modifications in their space, or wants to change their geography, it’s not applicable.  But playoff teams are expected to win their home games and landlords should expect to keep their tenants, especially when they can stay in their existing space with little work.

While it’s not always that easy, it should be.  Tenants don’t want to go through the expense or trouble of moving to a comparable building at a comparable rate.  If a landlord is providing good service during the term of the lease, a tenant is unlikely to move.  In fact, I heard a story earlier today about a tenant paying a $3.00/sf premium to stay in their building because they liked the landlord.

However, some landlords take advantage of this during renewal negotiations.  They know a tenant will incur costs to move. We always say “the only way to get the best deal from your current landlord is to convince them you have one foot out the door.”  

In some ways, it’s all about inertia.  A happy tenant isn’t likely to move.  They are comfortable in place and while they might look in the market, they are not a flight risk. On the other hand, if a landlord doesn’t provide the kind of service a tenant is expecting, the flip side of inertia can quickly take over.  An unhappy tenant looking at buildings in the market is a dangerous thing.

I am rooting for the Spurs tonight and in the series.  I would like to see Tim Duncan and Gregg Popovich win one more before they ride off into the sunset.  If they take care of business at home, they can’t lose given that they have home court advantage.  In most cases, landlords should be in a similar position with renewing tenants, if they take care of business.

The Rangers, on the other hand, need to steal a game in LA somewhere along the line.  They need a break, they need the Kings to slip up or they need to be that much better than the competition, not unlike a landlord trying to steal a tenant from a competing building.

What’s your opinion about the analogy?  Do you think landlords have an advantage?  Please leave your comments below.

JN

2014
06/05
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Monday, Monday

Time management has been on my mind a lot lately. I guess that happens when you’re busy and being pulled in a lot of different directions. There’s work, there’s kids, there’s work, there’s friends, there’s sports to watch and teams to root for, there’s concerts to attend, and there’s work. I am obviously not the only one that feels this way.

Because I really enjoy my job and I am a recovering workaholic, I am in tune with my email more hours of the day than I would care to admit. I have noticed something of late regarding email that I find interesting. While email tends to slow down on Friday around 7pm, it picks back up on Sunday right around the same time.

While I relax watching Sunday night television, I dive right in to my email during commercials or between shows, trying to knock out whatever I can prior to the workweek starting. Is there anything that can’t wait until Monday morning? Absolutely not! However, I almost can’t help myself.

Have you ever noticed that when you ask people about their weekends, many respond that it was “too short”? Do you think that has anything to do with the fact that they start working on Sunday night?

Instead of filing the quiet time after the kids go to sleep relaxing, I am starting my Monday morning on Sunday night. I am actually living in the future of the work I have to do Monday instead of the present and I am clearly not the only one.

This isn’t a new concept either. Many years ago, when my team was building our client base (we weren’t as busy and not making as much money), one of the first topics in our Monday morning meetings was the lack of sleep that some of us would get on Sunday nights because of the stress that Monday morning eventually brought. Living in to future of Monday morning prevented a good night’s sleep Sunday.

So what can we do? Will I stop responding to email on Sunday night? No way. Will Sunday night start to creep in to Sunday afternoon? Maybe. Do I think that eventually we will all be working seven days a week? No I don’t.

So if you are one of those people that says the weekend is too short (I don’t), think about whether or not you are shortening it by diving in to Monday morning too quickly. As brilliant philosopher Ferris Bueller said, “Life moves pretty fast. If you don’t stop and look around once in a while, you could miss it.”

In other words, if you don’t stop and look around, you might miss your weekend.

JN

2014
05/28
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Too Connected?

Last March, I wrote a blog post about shutting down email for an hour.  As you may recall, or can read here, the post discussed activity based workstations and the concept of having a quiet area to get work done.

I wish it was that easy.

It seems lately that etiquette has given way to people’s need for immediate gratification. It seems that if I don’t answer my office line, my cell phone typically rings shortly thereafter. If I don’t answer my cell, an email or text is likely to follow. There are some clients and projects that need immediate attention, but when another broker calls and emails on a 1,500 square foot deal, it’s enough to drive me a little crazy.

And what’s the etiquette on the timing for a return call? If I don’t return a call in an hour, when did it become acceptable to call again so quickly? Some people will call and email three or four times a day before I can get back to them. If I could, I would return the call…I promise!

However, I have come to realize that instead of getting upset, I need to embrace it. It’s the reality of doing business in 2014. We are far too connected and there will be people who take advantage of that connectivity. But are they doing it to annoy me? It seems like it at times, but it’s typically in the interest of moving a deal forward. They are just doing their jobs. Just because I don’t want to discuss a specific deal at that moment doesn’t mean that they are wrong for calling.

So what’s the proper etiquette these days? Do we need constant contact to get deals done? While there are times that I all I can think about is The Beatles’ song, Don’t Bother Me, it’s only because I want to get other work done.

I guess the answer is go back to my previous idea. Shut down Outlook, turn off the cell, close the door, and focus. Will they come up with another way to find me? I guess we will find out soon what the next level of connectivity is, but in the meantime, if you can’t find me, I am sorry. I will be back soon…I promise.

JN

2014
05/21
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Bern’s Steak House

“Hi there. How are you?  It’s been a long time. Seems like we’ve come a long way.”  The Eagles

I know. I know. Yes, it’s been a while since I have posted to NeuerSpace. I hope you’ve missed me.  In the last six weeks, so much has happened, including my 40th birthday and the launch of my FunnelCast blog for The News Funnel.

That said, NeuerSpace is back and will be updated regularly.

Now…on to the topic of the day.

Last week, I ended up visiting Bern’s Steakhouse in Tampa, Florida by accident. But I am glad I did.  I was staying in a hotel across the street and my cousin and I decided at the last minute to see if we could get a seat at the bar.

If you’re not familiar, Bern’s is one of the top-rated steakhouses in the country. In 1996, Wine Spectator ranked it as tied for the country’s best steakhouse and in 2009, Rachel Ray rated it as the best restaurant in the country!

The dining room seats 350 people and the upstairs dessert room seats an additional 250.  On a busy night, they will have 1,000 guests and their menu resembles a textbook with a table (columns and rows) outlining all of the steak options including type, size and thickness.

After an amazing meal and dining experience, which was also very reasonably priced, we were asked if we wanted the tour of the kitchen and wine cellar. On the tour, we learned that they grow many of the vegetables in their organic farm, use approximately 300 – 400 pounds of onions on a typical night, and have the largest private wine cellar in the world with 105,000 bottles on premises and another 500,000 in the warehouse. The most expensive bottle sells for $30,000, while the oldest dates back to 1815.

They also make their own ice cream on premises. They have 13 different flavors and the macadamia nut was one of the best scoops of ice cream I’ve ever had.  The bartender told me they refined the recipe 300 times before settling on this one.

And while I was amazingly impressed with the entire experience, it’s what that I learned after I left that really stuck with me. To become a waiter at Bern’s, you need to work on the farm for a year to learn about the food and the vegetables before you can begin working in the restaurant.

Bern’s does countless things right. If they didn’t, they wouldn’t be one of the country’s top restaurants. Bern’s attention to detail and process is one to be emulated. Their dedication to providing amazing service to each customer was obvious to me throughout my experience. Their commitment to training their staff correctly obviously pays off in many ways.

My company, CBRE, does a lot of things right as well. If we didn’t, we wouldn’t be the largest provider of corporate real estate services in the world. Recently, our team has taken a slightly different approach to training, more similar to Bern’s than what is typically seen in our industry. Judging by the first six months of our new process, I would say that the results far exceeded my expectations. If those results continue, I would say we are on to something.

You can’t be the best at anything without an unwavering commitment and dedication. I can’t wait for my next trip to Bern’s. I hope that our clients feel the same way about working with us.

JN

2014
05/08
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You Can’t Sit Down

Earlier this week, I read a post on The Wall Street Journal’s “At Work” blog about the treadmill desk.  I will come back to the article shortly, but for those that haven’t seen or heard about this product, it’s a treadmill that only goes up to two miles-per-hour and has a desk surface that allows you to work while walking.

lifespan-fitness-treadmill-desk

I first saw one in person when touring a new office suite environment about two years ago and dismissed it  immediately as a gimmick. When touring CBRE’s new Downtown LA office last year, I saw another one. I asked Lew Horne, the leader of the LA region and driving force behind the new office, if anyone used it. His answer shocked me. “All the time,” he said.

He then went on to tell me that there is a growing consensus among health professionals that sitting is the new smoking and since a healthier workforce is a more efficient workforce, the new space was designed to encourage people not to sit. In addition to the treadmill station, there were several other standing stations. I even saw one woman standing on a piece of foam that is designed to keep you moving, even while standing in place. And the more people move around, the more opportunity there is for collaboration, idea sharing, etc.

Back to The Wall Street Journal blog. A recent study by the University of Minnesota showed that workers who worked at the treadmill stations were more productive than their counterparts who sat all day. While there is an initial adjustment period, and it is certainly not recommended for the clumsy (people can fall) or those using fine motor skills, once people get acclimated, it works. Productivity, as scored by both the employees and their supervisors, increased significantly over a six month period.

I Googled “sitting is unhealthy” and there are over 7.3 million results.  “Smoking is unhealthy” yielded 8.3 million results.  “Workplace efficiency” yielded over 35 million results.  I will let you draw your own conclusions.

Coincidentally, Tuesday a friend asked me if I was using the pedometer function in my watch. I went on a bit of a rant saying I didn’t care how many steps I took in a day. After reading about the productivity increase brought about by the treadmill desk, I not only want one for our office when it’s redesigned, but I also turned on the pedometer function on my watch. Over 2700 steps so far today…and so many more to go.

JN

2014
03/12
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Derek Jeter – Part One

There are going to be countless article, blogs, books, and songs written about Derek Jeter between now and the end of the 2014 season.  Maybe not songs, but you get the point.  I am sure I will have a lot to say about The Captain in the coming months, so while I don’t have a Part Two in mind quite yet, I am calling this Part One.

Many of the articles and quotes I have read since Jeter announced his retirement have mentioned Jeter’s effort.  They cite the fact that he runs hard to first base on every ground ball, something that is taught in Little League, reinforced at every level, but not often seen on the Major League level.  That said, how many times has his running hard impacted the play or the game?  Yet, he does it EVERY time.

On the flip side is Robinson Cano, the former Yankee second baseman. Cano is an amazing player.  He plays every day, rarely taking a day off, plays great defense and is one of the best hitters in the game.  But he doesn’t always run hard, a fact that I am sure was considered as the Yankees evaluated him as a free agent.  Kevin Long, the Yankee hitting coach, stirred controversy recently when he mentioned Cano’s lack of hustle in an interview.  This truly highlighted the contrast between Jeter and Cano.

As I often do, I thought about how it applies to my business.  Do I run out every ground ball?  Would others perceive me as giving maximum effort or do they think I lack hustle?

It reminded me of a deal we did about ten years ago.  We were representing a large tenant in Central New Jersey.  Our client was occupying 180,000 sf in one of the premier buildings in the market, but the space was inefficient.  When we went out to look at alternatives in the market, one of the goals was to fix the inefficiency, even if it meant going to a lesser building.

Typical to the process, we developed a short list and sent out several requests for proposals. Many of the landlords were anxious to respond as it was large deal.  They were detailed in their responses and aggressive in their business terms.

However, one landlord provided a short, sloppy proposal that was above their asking rental rate. When I called to ask why, the in-house leasing agent told me that he didn’t think they had a chance to do the deal and that they didn’t want to be used as a stalking horse. He wasn’t running out the ground ball.

We called his boss, received a revised proposal and ended up doing a 150,000 sf deal at the building.  The in-house leasing agent was not involved in the deal after the initial proposal and left the company shortly thereafter.

Often, tenants will change their minds in the middle of a deal. A company that is focused on moving and won’t stay in their current building can shift their focus to a renewal based on many factors.  Similarly, a renewal can get off track when a company’s needs change and the space is either too large or too small.

A deal is a step-by-step process.  Each step is important and can’t be skipped. Every team member involved in the deal, on both sides, has to do their part.  Every task, trivial or critical, deserves a high level of attention, the same way Jeter runs out every ground ball.

My team is encouraged to use proper grammar and punctuation in emails, proofread proposals before they go out…the little things.  That said, I made a mistake this week in a proposal and sent it the client before it was caught.  No one’s perfect, but we aspire to be.

There are things you can’t control, errors/mistakes happen, but if you give maximum effort, good things (and even the unexpected) can happen.  You never know, right?

JN

2014
02/27
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Do The Evolution

I was recently asked to participate in a pre-launch demo of a web site that hopes to change the way we do business and form relationships. Just a little ambitious, right?

During the meeting, I expressed some of my reservations about the platform, mostly citing the way our business gets done, specifically on the leasing brokerage side.  One of the key investors in the site jokingly called me a technological Neanderthal.  While I consider myself quite the opposite, I realized that the commercial real estate industry may be far behind others.

That said, in the 15 years since I started in real estate, our industry has evolved in many ways. In November 1998, this is where we were:

– I bought my own computer, with my own money, when I started at Grubb & Ellis.  The company didn’t provide them to brokers.

– CoStar was not web based.  Someone in the office had to download the update, via a dial-up modem, every month.  And the kicker was that the information was only correct about 50% of the time.

– Everyone had a “mobile” phone, but there was nothing “smart” about them.  Palm Pilots were not yet popular either.

– We still used scratch off numbers to label maps for market tours. I wish I had a picture to post, but they are all gone.

– The fax machine was the most important piece of equipment in the office.

– The internet was not something you could take with you. And even when you could access it, it was limited in its reach and breadth.

Today, I think I know where the fax machine is in our office, but I’m not 100% sure. We have come a long way in the last 15 years and the changes are coming faster and are having a greater impact.  However, with so many technology start-ups and a plethora of tools to choose from, how do we know which ones to invest our time in?

For me, I look for tools that enhance the human experience rather than try to replace it. LinkedIn is great for certain things including marketing a blog, but for me, nothing replaces the value of meeting someone and forming a personal relationship.

The News Funnel gives me all of the real estate news that I care about in one place and also gives companies and bloggers the opportunity to post directly to their Company News Channels.  Enhancement.

ViewTheSpace is a great marketing tool, but in my opinion, the videos don’t replace the need to visit the space.  Rather, the videos increase the likelihood of those visits. It makes our job as brokers easier.  Enhancement.

Floored and Fast Office provide virtual images, allowing tenants to see what a space could look like, rather than a simple floor plan, making it easier to make decisions about a space.  Enhancement.

Personally, I look forward to a time when conference calls are replaced by Google Hangouts.  How much more efficient would the time be if everyone was forced to pay attention because you could see all of the people participating (or not)?

It’s evolution, baby. If you don’t embrace it, you run the risk of being called a Neanderthal, or worse, getting left behind.

What other tools are you using that speak to the evolution of our business?  What tools do you remember using that have gone the way of the dinosaur? What do you hope is coming next?

JN

2014
02/14
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Coming In Second

As I was watching the end of the Super Bowl last night, I felt a bit of sympathy for the Denver Broncos.

Truth be told, I was rooting for the Seattle Seahawks, but given the context, I would have felt bad for either team.

The Broncos had a great regular season. Peyton Manning had a record-breaking season and won his fifth Most Valuable Player Award. But they fell one step short of their ultimate goal.

Years from now, very few people will remember anything about the Broncos’ 2013 season except the individual records that Manning set and maybe the fact that they didn’t win the Super Bowl.

There’s no glory in finishing second in professional sports. There’s less glory in coming in second in real estate.

Real estate deals are not dissimilar to sports. It takes a team, working in unison, to complete any deal. The landlord, the attorney, the broker, the architect, the project manager, and others all have to be aligned and responsive to a tenant’s needs. Any weak link in the chain is an opportunity for another landlord, another attorney, another broker, to win the deal.

Last year, I worked on a deal on behalf of one of my landlord clients. We negotiated back and forth with the tenant for eight months. We sent over a dozen written proposals. In the end, we came in second and the tenant made a deal with another landlord.  No deal, no glory, no commission, and certainly no accolades from the client for a good effort.

While we won more than our fair share of deals last year, coming in second on the one I mentioned sticks out. Not because of the size or the potential commission, but rather the time we spent and the amount of work that went into it. In some ways, I would have preferred being eliminated from consideration earlier.

Some fans say that they prefer their teams being knocked out early rather than losing the Super Bowl so they don’t get emotionally invested.

I empathize with the Broncos and their fans today.  Coming in second sucks.

JN

2014
02/03
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Two Lessons from Bruce for Young Brokers

Bruce Springsteen has been been in the press the last few weeks, promoting his new album, High Hopes.  He has been interviewed by Rolling Stone, NPR, and appeared on “Late Night with Jimmy Fallon” as both the couch and musical guest.  He even played a third song that Fallon released as an online exclusive and did a Born To Run parody that’s gone viral.

After the public appearances died down, and before his upcoming shows in South Africa, Bruce stopped by the Light of Day benefit concert in Asbury Park last weekend.  It wasn’t completely unexpected. Bruce has played this benefit many times in the past with his friend, Joe Grushecky.

It makes sense that Bruce brought his A-game to the interviews and Fallon appearance.  After all, he’s trying to sell albums (does anyone other than me still call them “albums”?), and the interviews were widely distributed.

However, Bruce put forth his maximum effort in front of 1,600 people in Asbury Park.  He even showed up early in the afternoon to rehearse, debuted a song off of the new album, and his performance was tremendous, as always.

There are two important lessons for young brokers (and great reminders for older brokers) that were very present to me as I drove home:

– First, the same way that Bruce didn’t treat this performance like a small show, there is no such thing as a small deal.  My team averages about 100 transactions a year, representing both tenants and landlords, and many times, the smaller ones are more important to the client than the larger ones.  The attention to detail needs to be present, irrespective if the deal is 1,000 square feet or 100,000 square feet.  

Obviously, Bruce’s performance over the weekend wasn’t about money.  It goes back to a quote from 1978 that has been on my cork board at work since it reappeared in Rolling Stone in 1999, “The whole idea is to deliver what money can’t buy.”  People, like me, come to see Bruce over and over again because we know that he will do everything he can to make sure that it’s an amazing concert experience, whether it’s in front of 50,000 people in Giants Stadium or a few dozen people in a bar down the shore.

As a service provider and trusted adviser, we need to do the same thing.  We need to deliver.

– Second, if Bruce Springsteen, arguably one of the greatest performers in the history of live music, can show up early to rehearse, so should everyone. When we make presentations, I’d like to think we do a good job of rehearsing beforehand.  My partner, Joe Sarno, likes to do at least one or two full run through’s beforehand, making notes, typically on little yellow Post-Its.  Show up prepared and rehearsed, or don’t show up at all.

For me, seeing a Bruce show is usually a bit of a religious experience.  Last weekend, it was a learning experience too.

JN

2014
01/27
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Winning Tenants – Landlord Perspective

As you can imagine, my 2014 goals are still very present in my everyday thoughts.  The first goal I discussed in my recent blog post was to increase occupancy in the buildings we represent.  I spend a lot of time thinking about how to win tenants.

During last year’s CBRE conference, there was a session on Related’s Hudson Yards project. The leasing team explained the amazing development on the west side of Manhattan and the changes to the infrastructure in the neighborhood. Three tenants, L’Oreal, SAP, and Coach have committed to the first tower and just yesterday, Time Warner announced it would be moving from Columbus Circle to Hudson Yards as well.

After the session, I approached two of the panelists and asked, “What was the one thing that won the day?” For each company, there was a different answer. I was hoping that there would be one answer, which would allow me to take a clear message back to my landlord clients, but there wasn’t. They all made their decisions for different reasons.

When I started in the commercial real estate business, the joke was that we could do a survey of the market, but the building closest to the boss’ house was the building that would win. That couldn’t be further from the truth in today’s market. However, here are some of things that tenants do consider as they are making their decisions:

1) Mitigation of Risk

In major corporations, making the wrong decision can cost someone their job. Years ago, we were doing a national data center search for one of our clients and the best existing data center we found was in San Francisco. It was immediately crossed off the list. The real estate director didn’t want to be responsible for recommending a building that could be impacted by an earthquake, even if the building was reinforced.

2) Landlord Reputation

This goes hand in hand with mitigating risk. Is the landlord a company that will deliver what they promised and on time? Will the employees be happy in the building? How do they treat tenant requests during a lease? Do they have a history of strong tenant retention? These are all questions we are asked by our tenant clients as they consider buildings.

3) Process

Again, this goes back to mitigating risk and the landlord’s reputation. Will the deal be an easy process? Can we get through the lease in time? Will their architect turn around plans quickly? There’s a reason certain landlords, like my client KABR, win more times than they lose. If the process is easy, it removes significant risk and gives the tenant comfort that they are important and will be given attention even after they move in.

4) Location

As I mentioned, it’s no longer about being convenient for the boss. Mass transit, especially access to the train, is becoming increasingly important. Access to the right labor pool is critical, especially to growing companies.

5) Branding

Is this building the image we want to portray, not only to our employees, but more important, to our customers? Is there an opportunity for building signage and how does that signage fit in with an overall branding strategy?

6) Efficiency

As companies seek to improve their workplace, the shape of the floor plate, the access to natural light, and in some cases, the ability to pack as many people into the space, is a greater part of the conversation. Landlords need to be concerned about the impact to building systems and bathrooms, but many companies are less concerned with cost per square foot as they are with cost per employee (and rightfully so, in my opinion).

7) Amenities

It’s a bigger part of the conversation than ever. As companies seek to enhance their employees’ experience, they want to know what the building can provide. A building-shared conference center or training room can also help a tenant gain efficiency, as they don’t need to include it in their space if it already exists in the building.

8) Parking

With the greater efficiencies comes a greater need for parking. We recently won a tenant because our landlord client was willing to give them the rights to all of the parking, even though they were only leasing 80% of the building. Solving the parking problem was the largest hurdle to overcome in that deal.

9) Price

Last on the list for a reason, but still on the list. All companies still look at price, but some are willing to pay higher rates because it better supports the business. We always tell our clients, the business should drive real estate, not the other way around. While the market keeps the pricing of buildings within a given submarket similar, there’s a reason certain buildings can and do charge more. It’s because of all of the reasons above.

So how do we know which of the above will win the day? We don’t. It’s listening on the tours and in meetings about what’s important to individual companies and the decision makers. If we ask the right questions, we can hope to crack the code.

If you are a landlord or represent landlords, do you agree with my list?  If you are a tenant, why did you choose your space?  I’d love to hear your opinion on this topic.

2014
01/17
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