Suite Deal

by Alice Devine

  Property manager: “I heard. Did they end up committing to seven years or ten?” (Specific question shows that the property manager knows something about the term and makes it easier to extract the answer.)

  Outside broker: “Ten, although they have an option to cancel after seven.”

  Of course, the above exchange is a typical example of how leasing personnel fill in the missing pieces of their knowledge to build a comprehensive understanding of the marketplace. Here’s another sample:

  Broker: “Did you hear X Company has committed to the top floor of New Tower?”

  Landlord rep: “Have they topped off the building?” (Rep is asking if construction is nearing completion, which will lead to a tenant occupancy date. Since the landlord rep has researched the market, the rep knows the floor plate of New Tower measures 20,000 square feet, so the suite size is a known variable.)

  Broker: “Not yet.”

  Landlord rep: “Well, hopefully we’re on the invite list for the topping-off party!”

  At this point the real estate professionals might move onto another topic and maintain an easy banter or they might delve deeper into talks about New Tower. Make sure you scribble some notes as soon as possible and enter them into your information database later.

  As a note, occasionally a tenant or another party in a lease transaction will request a confidentiality agreement with respect to the terms of the lease transaction. Respect this, and move on to another topic. (Be aware that some professionals might insinuate such a confidentiality request—even sans a formal agreement—in order to refrain from sharing details that might hurt their own leasing efforts.)

  Entertaining, Corporate Style

  Whether at a white-tablecloth dinner or ballpark suite, most landlords cultivate relationships using social events that extend beyond the workday. Uptown or downtown, successful events share some attributes that get the most bang for your entertaining buck. So learning some entertaining basics can come in handy.

  The Purpose

  What’s the point of the event? Knowing your purpose allows you to tailor the social activities for maximum impact. Is it to attract brokers to available space? Highlight a renovation? Cultivate colleagues who can talk shop? Identifying what you want to achieve as well as what attendees will gain creates the framework for a successful event as details from decor to food can be assessed in terms of the end goal.

  My firm hosted an annual Dealmaker’s Dinner to honor brokers (plus their guests) whose clients had signed a lease with us that year. Each December, we booked a hot restaurant in San Francisco. The changing venue added a spark, as dining at the latest Michelin star restaurant seemed akin to a lottery win. We hired limos to transport guests. At the dinner, we acknowledged Repeat Offenders, brokers who’d completed more than one deal in that year or previous years, with a special gift. The event became a coveted invitation—a fun, luxurious, and exclusive evening that built friendships. With over 80 percent of invitees saying yes to the invitation, it proved a hit.

  Branding

  From the invitation to a promotional gift, each facet of the event offers a chance to convey mood and create consistency. Choose colors, fonts, and themes accordingly.

  The Venue

  Real estate professionals pay attention to physical space and the experience it generates. Evaluate the sound system, table layout, and seating arrangements. For tables, consider smaller tables (sixty-inch round or smaller) that create energy through physical proximity and conversation. While large or long tables may look stately, they often isolate guests by limiting conversation partners. For any gathering over eight people, assigned seating arrangements are a great idea. And remember that no one likes the dark table squeezed next to the swinging kitchen door.

  In terms of sound, ensure that conversation and any speakers can be heard over ambient noise. It’s anticlimactic to ask your dinner partner to repeat a joke’s punch line. By previewing the sound system, you can ensure that the new analyst seated at the back of the restaurant can hear as well as the executive vice president at the table in the front.

  One of the best and most cost-effective marketing events I held was a monthly Breakfast Club in various vacant office suites. We’d set up two or three tables; one with a buffet of coffee, tea, scrambled eggs, toast, made-to-order omelets, and lattes, and set the other table(s) for seated guests. Breakfast started at eight, and we’d welcome brokers, give a brief overview of the vacant space, throw out an interesting topic of the day, and eat. By nine, most brokers had departed. The casual, consistent nature of the event made organizing easy, costs reasonable, and the vacant space showcase effective. After all, everyone needs breakfast, right?

  Restaurants and Caterers

  There’s a certain balance to selecting an interesting menu that kitchen staff can deliver on time and within budget. Corporate planners satisfy these sometimes-competing demands by combining standard menu items with customized choices. For example, you might serve the same appetizers, salad course, and dessert to everyone yet present two or three choices for the entrée. Limited choices appeal to the serving staff and usually create a better guest experience. After all, no one wants to watch their steaks cool while others wait for their salmon. Finally, verify that adequate staffing is included in the food contract. Include a server who greets guests with a tray of sparkling water and wine to kick-start the party. First impressions count, and it sure beats a long line at the bar.

  Print the menu on the same paper and with the same theme as the invitation and place a copy at each table setting (wait until the day of the event to print the menus in case of changes to the meal ingredients, and pending a final attendance count).

  Remember bad Uncle Billy, the loud uncle who drank way too much before Thanksgiving dinner? Yes, we all have one. When I host a company event, I keep Billy in mind by limiting cocktails to an hour or less. Also, I make sure that servers pass bite-sized hors d’oeuvres (with cocktail napkins) so that guests can enjoy each other rather than push their way to a crowded table for a cracker. Parties are all about momentum, and if Uncle Billy doesn’t eat anything, things spiral downward pretty quickly.

  Make Alice Waters Proud

  Remember that people attend events for an experience. Go long on excellent seasonal food and skip the predictable chicken entrées and ubiquitous cold custard fruit tart.

  Logistical Planning

  Thinking through logistics that impact venue, budget, and most importantly, the guest experience is a critical, if less glamorous, part of event planning. Start by mentally walking through the event, beginning to end. Then, talk to the appropriate contacts (such as the caterer, valet, etc.) and resolve any outstanding items.

  The Devil in the Logistical Details

  Parking, valet (and transportation)

  Lighting

  Sound system and acoustics

  Necessary bar and catering staff

  Seating arrangements

  Coat check

  Menu (and alternatives for those with allergies or other preferences)

  Alcoholic and nonalcoholic drinks

  Agenda and timing

  Budgets

  Corporate events reflect the current economy. In volatile markets, subdued gatherings rule the day, small in scale with targeted audiences. In bullish markets, anything goes. No really, it’s real estate. Solid relationships, however, can be built with relatively modest events.

  The event menu, bar, and labor drive the bulk of expenses. The menu cost depends on the ingredients, so many hosts temper a pricier item such as steak with a lower cost pasta or risotto. For drinks, event coordinators purchase wine separately and ask if the restaurant will provide corkage. Remember to negotiate wine prices as restaurants usually quote on a per-bottle basis, and you will purchase in quantity. Timing plays into the budget, too, as restaurants and caterers are often less expensive and more flexible o
n weekdays.

  Tips for the Budget Conscious

  • Hold the event on a weekday—restaurants and associated costs rise on the weekend.

  • Breakfast and lunch are less expensive than dinner.

  • Offer poured glasses of wine and water instead of a full bar.

  Timing

  When scheduling any event, consider the audience and the type of event. For example, a Friday evening without spouses, partners, or guests can prove disastrous as people race to weekend plans. And meetings or emergencies can fill Mondays. Event planners often choose Thursdays for lunch or dinner. Guests are a little more relaxed as the week winds on, yet the event doesn’t interfere as much with personal time.

  The Guest List

  When it comes to corporate events, a curated guest list produces the best results. Have a specific reason to offer a spot to each invitee and then do everything possible to create an invitation and event that will elicit positive attendance from that group.

  One of our company executives enjoyed inviting couples to dinner. His rationale: meeting a spouse or partner allows you to know your guest in a more authentic manner. Although perhaps a bit mercenary, the executive also believed that individuals would act with more integrity once he had been introduced to their inner circles.

  Piggybacking

  Companies capitalize on large glitzy events by arranging smaller exclusive gatherings around the larger one. For example, take advantage of companies on location at a convention, without incurring the cost of transportation or significant coordination, by hosting a small cocktail reception in a private suite before the keynote speech.

  Invitations

  Good invitations generate excitement, especially when great restaurants, popular music, and hard-to-secure tickets are involved. In terms of the actual invitation, David Eiland, president and co-owner of San Francisco’s Just for Fun, says successful hosts “make the invitation speak to the event.”4 Eiland suggests unique invitations that don’t disappear under last week’s utility bill. For example, a paneled card that displays construction elements (hardhat, shovel) with an inserted nut and bolt at the top of the invitation might celebrate a construction groundbreaking. Another client uses easel-backed invitations for vertical display atop a desk. Keep your budget in mind, though; $5 or less per invitation set is a good rule.

  Your invitation should generate event buzz by showcasing a fun venue, notable guests, interesting speakers, or a great activity. Make sure the invitation speaks to (i.e., is consistent with) the event. As with all communication, pay extra attention to names: Bill Smith likely won’t open an envelope addressed to “W.R. Smithe” because of the misspelling and unlikely use of initials.

  Social Secretary

  When inviting a significant number of guests from one company, verify the date with that business’s office manager for potential conflicts.

  Envelopes Should Be:

  Personally addressed, not labeled

  Stamped, not metered (commemorative stamps are even better)

  Properly stuffed (so the invitation is face up when one opens the envelope)

  RSVPs

  Receiving accurate responses from invited guests starts with a complete invitation (who, what, where, when, why). For instance, invitations should list a telephone number or email along with the contact’s name and a specific due date for responses. On the host’s side, the RSVP contact person needs all the event information to answer any questions. Once past the indicated response date, you’ll likely need to follow up with stragglers to make sure they received an invitation and to see if they can attend. And please, avoid the dreaded “Regrets only,” which generates poor response and leaves you in the dark for planning. Keep a spreadsheet of responses that lists the attendee’s name, company, address, telephone number, guest name (if applicable), RSVP of yes or no, and any other applicable columns (table number, golf index, etc.). Some event organizers use an extra column to itemize information such as allergies, likes/dislikes, and so on.

  Gauging the Turnout

  Formal functions: Turnout rates of 60–65 percent are excellent.

  Casual events: Expect a 35–50 percent positive response.

  No-shows: Anticipate 8–10 percent and plan accordingly. Have an alternative seating plan so guests have company and servers can quickly whisk away the extra setting.

  The Actual Event

  When the event starts, welcome guests at the door and greet them by name. Have fun, but not too much fun—remember you’re the host. Be true to your invitation. If you invited guests to a dinner, don’t talk shop over dessert. Instead, ask about their children, a recent trip, or a hobby. As the venerable Emily Post writes, “Good manners are, after all, nothing but courteous consideration of other people’s interests and feelings.”5 The goal is to build connections with others by getting to know them and making them comfortable.

  For one client event, we hired a stand-up comic who started with a couple of unimpressive magic tricks. Next, he picked an audience member to embarrass. Too bad it was a senior VP who’d flown in from New York and didn’t take kindly to being the butt of the joke. The room fell quiet, and I wished for a giant hook to yank him offstage. That cringeworthy moment taught me to preview any entertainer—musician, magician, or comic—before booking.

  Follow-Up

  A brief “Thanks for coming” note or photo mailed after the event provides another touchstone for relationships. Posting photographs online to memorialize the event might be expedient, but be sure that posted items remain business appropriate. Remember, it’s all about the relationship.

  Promotional Gifts

  Promotional gifts are part of a well-designed marketing package as they advertise your company and remind others of a relationship, long after the party lights fade. According to the Promotional Products Association International, the challenge is to relate promotional products to the recipient. More often than not, that means appealing to the so-called millennial who comprises the largest share of the US workforce (one in three professionals) and who values purpose, access to assets, and engaging experiences.6 While some groups donate to a favorite nonprofit, other hosts look to trends in the retail marketplace for relevant gifts. For timing, four weeks lead time is ideal for product conception, production, and delivery.

  From cool outdoorsy jackets to the latest tech gadget, businesses tout symbols that connote status and success. Consider the canvas duffel bags first made popular by EF Hutton and carried by investment bankers, slung across their chests, a cross between county club and hip messenger bag. It became a symbol of a good education and a good job. While the gifts may change, the message stays the same—that of success.

  Part II

  Structuring the Lease Deal

  Chapter 5

  Tour Prospective Tenants

  “I’m convinced that buyers decide if they’re going to buy your house within the first eight seconds of seeing it. So set your stopwatch, get out of your car, and see what you see in the first eight seconds.”1

  —Barbara Corcoran, founder, The Corcoran Group

  Goal: Give a Tour That Will Land Your Building on the Prospective Tenant’s Coveted Shortlist

  Three figures stumble along a dimly lit corridor. The woman in the navy blazer works the key into a stubborn lock and pushes against the scratched door. Inside the musty office, her hand fumbles for the light switch. Finally, lights flicker on to reveal a space whose blinds are shut tight against the afternoon sun. The tour, the tour, the classic tour.

  The tour is our brief moment on stage, a chance to meet face to face with the tenants and show the best parts of our property and how it might fit their needs. In some ways, the tour serves as the most acute test of the market as tenants decide whether or not to pursue space in a specific building. Importantly, the meeting allows a personal connection between the landlord and the prospective t
enant, a sizing-up of a potential relationship. Tenants will assess your integrity and professionalism, which will affect their experience as a building occupant. At the same time, leasing agents will try to get a sense of tenants and their business. Tours either spark the embers for a long-term business relationship or douse the flame.

  And it all happens so fast. Studies show that first impressions—or rapid cognition—occur within seconds. Coined thin slicing, the psychological term refers to a human’s ability to make sense of situations quickly.2 The theory that humans make judgments in astonishingly brief periods of time and then use the balance of their time to justify their initial thoughts underscores the importance of curb appeal. Long-term leasing decisions may hinge on our prospect’s first view of a property’s parking lot or on our own introductions. Part rigorous preparation, part show, part intuition, tours are an artful science that you cultivate with practice.

  Arrange the Tour

  Handle Initial Inquiries

  Most tours start days or weeks before a visit, with a telephone call. While brokers and prospective tenants both research properties online, brokers will usually also call landlords to confirm and discuss space availability. Uninterested brokers rarely waste time with this type of telephone call (unless they represent one of your existing tenants and are scouting for information), so treat each call as a bona fide prospect.