Strategies that lure tenants for long term.
While many players in the suburban office market have experienced difficulties during the past few years, Cali Associates has continued to perform well, with leasing activity totaling nearly 400,000 square-feet of commercial office space so far in 1993. The company reports an overall occupancy percentage in the mid to high 90's for an office portfolio that encompasses more than 2.5 million square-feet of space.
This high occupancy rate is maintained from the following marketing and management strategies that have proven to be effective throughout Cali's 45-year history in the real estate industry.
Cali relies on an interdisciplinary approach to execute a coordinated, comprehensive program for leasing and tenant renewal. Every building project is supported from the company's Cranford headquarters by an expert staff of professionals, which comprise various departments - leasing and marketing, property management, accounting, legal, architecture and construction-that work closely together to achieve the right product for the right market. Signing tenants to long-term, competively-priced leases in quality buildings with good management is a victory for all parties. Attracting new tenants to buildings is only half the battle in achieving realty success. Keeping buildings occupied with satisfied tenants is just as challenging.
One of the worst things an owner can do is neglect existing tenants in the pursuit of new ones. Once a project is leased, keeping existing tenants through renewals is the most cost-effective way of maintaining that stable rent roll.
Loyalty has become a commodity and everything should be done to earn and maintain a tenant's allegiance. Cali's policy has always been to accommodate its existing tenants first, whether it means extending a lease term until corporate decisions are made, providing tenants with additional space on a temporary basis, or even providing storage space. In short, make life as easy as possible for the existing tenant to remain in the building. Tenants not only enjoy the comfort of knowing that all essential building services are taken care of, but they also benefit from a number of tenant-centered amenities. Cali publishes "Caligrams" newsletter and sponsors various activities for its tenants, such as ice cream parties and community-related events, such as art exhibits in the building lobbies and donation drives for Toys for Tots. Hands-On Property Management
An on-site property management program is the most effective and efficient way to assure tenant satisfaction, starting at the move-in. At Cali, every development property is assigned an on-site superintendent and a project director. The project director is often a partner in the property and maintains an active role in building management. Even after construction is complete they stay with the project, overseeing building management and tenant relations. One of the reasons why Cali has remained local in its development interest is not only because the opportunities in New Jersey are so vast, but because its project directors can access each of the properties quickly, and therefore, manage them effectively. Keeping Buildings Up to Date The building needs to be functional for the user, as well as attractive. Because of the numerous bankruptcies and foreclosures of the late eighties and early nineties, tenants today want buildings that are owned by stable landlords who have the financial resources to continually enhance the building quality and services.
Fortunately, Cali has remained strong despite the ups and downs of the real estate market and has been able to upgrade its properties along the way, making them more contemporary in terms of aesthetics and technology. With the advances today in telecommunications, even the smallest of tenants look for fiber optics, satellite dishes and UPS systems. The telecommunications capabilities must be current and flexible in order to meet the ever-changing demands.
Renovations will make the building more competitive with the newest space in the market. A prime example of this is Cali Corporate Center at 65 Jackson Drive. A renovations program helped to attract the prestigious corporation of Kraft General Foods, among other new leases, expansions and renewals. Once a building with substantial vacancy, 65 Jackson Drive is now fully leased. Services and Amenities
The best work environment possible for tenants is not only achieved by an attentive building staff and dedicated property management, but also by providing extra services and amenities. Cali has found that tenants, especially those who previously worked in Manhattan, enjoy the added conveniences of food services and cares, ATM banking machines, travel and delivery services, dry cleaning, and newsstands in their buildings. These "extras" are greatly appreciated by the tenants.
In summary, owning an office building today goes beyond simply providing "baseline" services. It is a longterm commitment to tenants, and the success of a suburban office building in the 90's will depend upon this commitment.
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|Title Annotation:||Suburban Markets|
|Publication:||Real Estate Weekly|
|Date:||Oct 20, 1993|
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