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Brokers stay the course during slump.

Brokers stay the course during slump

While office market conditions of this decade thus far are a far cry from those of the last, the ingredients of a successful brokerage operation -- hard work, market knowledge and good negotiating skills -- have not and should not change, says Arthur Draznin, president of Harper-Lawrence, Inc.

Draznin, who succeeded Gil Robinov as head of the brokerage specializing in office leasing for tenants and owners, said those brokers that come in with "cavalier" attitudes and proposals will alienate people and find themselves hurting when the market turns around.

"That's not the way it's done even today," insisted Draznin. "There's no reason the normal negotiation process should disappear because prices are different."

While Harper-Lawrence changes and continues to change to keep up with the market and the current climate, Draznin said, he continues to try and instill in his team his own hard work ethic.

"There is no substitute for canvassing and providing on-going service to customers and clients making sure that through the process no stone is left unturned. And anyone who treats this business any difference does not succeed at it."

Draznin, who started in the business in 1975 with Edward S. Gordon Company, said he has assembled a professional staff of approximately 20 brokers and salespersons. Harper Lawrence's core office leasing team is comprised of: Draznin, David Solomon, executive vice president with 25 years in the business; Dennis Karr, senior vice president, with close to 20 years experience; Peter Kallish with 20 years in the business; Barry Goodman who recently joined after 15 years with Edward S. Gordon; Peter Tuttman and Clyde Reetz.

And despite market doldrums, Harper Lawrence has been busy, its leader reports. Recent tenant representation deals include: Tiffany Company for 65,000 square feet; Paine Webber for 100,000 square feet worth of leases, Morrison, Cohen Singer Weinstein for 60,000 square feet, National Cleaning Contractors for 65,000 square feet. Other tenants include: British Airways, Gibbs & Cox, Pavia & Harcourt, Turner Construction, Meridian Hotels, and Salomon Brothers.

Exclusive agencies for owners include 600 Madison Avenue. Harper Lawrence recently brought the 350,000-square-foot office building to 100 percent rented when they leased the entire ground floor to the flagship operation for Eddie Bauer.

They are also the agents for One Dag Hammarskjold Plaza, which until recently has been 100 percent leased, the recently renovated 1790 Broadway and a 400,000-square-foot office building at 440 9th Avenue.

Draznin said their approach to owner representation is "hands on", which, he said, is the only way to operate today when there is a fight for tenants. And today there is a greater emphasis on marketing.

"Never a time goes by when information is necessary -- floor plans, financial lease analysis or information about floor load -- doesn't get delivered or answered immediately...You do whatever you can do to drag them in ... The product will not get sold unless prominently displayed on the shelf."

In representing tenants, Draznin said, they offer the advantage of their affiliation with a major owner/developer the Lawrence Rubin Company, which gives them access to full management capability, construction capability, and legal and financial services.

"This allows us to tie our specific experience, which is a complete knowledge of the market, astute negotiating capability, together with everything else necessary to make it happen today."

The firm, Draznin said, has been negotiating a considerable amount of lease renewals for tenants. They have shown tenants, he said, the cost associated with the landlord replacing them and they have been able to get from the landlord all or a good portion of what they would give to an outside tenant without the risk.

For a not-for-profit organization, for example, they were able to convert the value of a new building installation into additional rent concession.

"So that tenant renewed their lease with their existing landlord but were treated as if an outside company was renting space for the first time," he said.

In reviewing the escalation, common area charges and maintenance charges for an international tenant they were representing, the Harper Lawrence brokers found the tenant was being overcharged. They brought this to the attention of the client and they are now using it to negotiate a favorable renewal.

They also represented a tenant recently who had several years remaining on its lease but wanted to move. Harper Lawrence moved them to another building where the new owners took over the existing obligation, amortized a portion of that existing obligation into a new long-term lease, and subleased their old space so that the landlord had a much smaller loss than originally anticipated and the tenant had a larger brand new space at a smaller rental.

"We're coming up with creative solutions," he said.

While deals are still being made, Draznin said, getting paid is a problem for brokers today. His firm, he reports, has been burned by a number of bankrupt buildings.

Draznin said most successful brokers have a high level of insecurity and hunger for deals. "The biggest fear I have about this business is waking up and not knowing where my next deal is coming from, and as a consequence I attempt to instill that same sense of concern in all that people that work with me."

While it may sound cliche, Draznin believes there is a need to get "back to basics." With all the financial technologies involved in leasing today, he said, many have lost sight that brokerage is still a "people business." Draznin encourages his staff to get out and continue to meet new people and strike up new relationships.

Draznin describes his firm, which also does some investment sales brokerage, as a "boutique with highly qualified and capable people who are attentive, energetic and professional in every facet of the business." He is comfortable with the firm's size and said he does not want to become a large "bureaucracy."

"It's a lot tougher for us to gain a foothold with the 100,000, 200,000, 300,000-square-foot tenants but we've managed to capture several," he said. "I'm very pleased when we close the 5,000, 10,000, 20,000, and 50,000-square-foot deals. I'll do those all day."

Large size tenants will require a firm with a greater |presence' in the market, he said, mostly for purposes of accountability when something goes wrong.

"However, there are many smart tenants that realize that this business is a people-driven business and if you have the right person and firm you're probably better off than with just a large firm."

While hard work is the credo at Harper Lawrence, Draznin assures that there is also some levity. "We even manage to have some fun and laugh once in a while which is an area that I think is lacking with some of my competition."

Draznin said he remains bullish on New York. "There's 300-plus million square feet of office space and thousands upon thousands of tenants. There's plenty of business for all with leases expiring all the time."

PHOTO : Arthur Draznin President Harper-Lawrence, Inc.
COPYRIGHT 1991 Hagedorn Publication
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Copyright 1991, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Title Annotation:Harper-Lawrence Inc.
Author:Fitzgerald, Therese
Publication:Real Estate Weekly
Article Type:company profile
Date:Jul 10, 1991
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