Browse Category: Office

Tips for Conducting a Successful Property Tour

Today’s guest post is by Dave Morris, CCIM, Sales Executive with Xceligent and former president of St. Louis CCIM, SIOR, Missouri Commercial Realtors, and St. Louis Commercial Realtors chapters. Connect with David on LinkedIn: DavidMorrisCCIM

 

 

Tips for Conducting a Successful Property Tour

As a listing broker, you spend a significant amount of your time prospecting for new tenants for your listings.  Once you’ve identified a prospect, you want to be sure to present your listing in the best possible way.  The initial property tour is the best time to highlight the properties’ benefits and address any concerns they may raise.  Do not miss this opportunity by allowing cooperating brokers and/or prospects to tour a space without you.  Here are some tips for conducting a successful property tour.

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Types of Commercial Real Estate Leases

If you’re just plunging into the world of commercial real estate leases, you might feel a little overwhelmed by the different terms used in the field. You might even feel unsure of what you’re getting into. But those terms aren’t as intimidating as many people think.

All leases are based around two main calculation methods – gross and net.  Within each method, there are a variety of types: full service lease, which is also referred to as full service gross, modified gross, and a variety of net lease, including triple net. These leases provide a base from which rent and expenses are calculated.  In both cases, the tenant pays a base rent for the property and the type of lease will determine whether the tenant or landlord pays the other operating expenses.

For instance, in a gross lease, the tenant is expected to pay a monthly lump sum rent that includes utilities, taxes, maintenance fees, janitorial fees, security fees, etc. The landlord includes all these fees in the rent and then pays for these expenses on behalf of the tenant.

For a net lease, the fundamental principle is that the landlord charges only the base rent, and the tenant contracts and directly pays for any other operating expenses including property taxes, insurance, janitorial services, maintenance fees, security fees, water, trash fees and other costs.

So, without further ado, let’s discuss the three types of commercial leases in more detail.

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5 of the Fortune 15 Are Building New Headquarters

Five of the 15 Fortune 500 companies will build new headquarters in 2017.

Amazon Joins Other Fortune 15 Companies in Building New Headquarters

Amazon recently announced the start of their selection process to find the location for a second headquarters that could employ as many as fifty thousand (50,000) new full-time employees with an average compensation exceeding one hundred thousand dollars ($100,000) over the next ten to fifteen years.  This opportunity has communities scrambling to identify the incentive package and real estate site that can land this amazing deal.  The initial requirement is for 500,000 square feet that will be open by 2019 that could grow up to 8 million square feet by 2027.  The establishment of a second headquarters by Amazon will be the fifth company within the top 15 of the Fortune 500 to begin or complete a new headquarters project in 2017.

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Telecommuting Turnaround: IBM Changes Its Tune On Remote Working

Home office

Telecommuting or remote working enabled by technology and online access has long been a commercial real estate market worry. The phenomenon of employees skipping on commutes and avoiding distant offices has raised fears of a softening national demand of office space since at least 1996. As reported by Global Workplace Analytics, regular remote working at home among the non-self-employed population has grown by 103% since 2005. 

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Tampa Office Market Analysis: Amgen Moves In

Picture of Amgen office and flag

The $25 million dollar office investment biotech giant Amgen has made in the Westshore business district of Tampa is touted to bring over 400 high-paying jobs to the Sunshine State. The California-based company’s plan to open a “capability center” — a kind of business support and operations facility — will occupy four floors of Corporate Center One, at 2202 N. Westshore Blvd., taking up over 125KSF.  The facility will open in October of 2017.

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McDonald’s HQ Set To Return To Downtown Chicago — On The Site of Oprah’s Studio

Harpo Studios, headquarters of talk show host ...

Crains Chicago Business reports that McDonald’s corporate HQ is bugging out from its sprawling suburban Oakbrook, IL campus back to a locale it once called home — downtown Chicago.  The reasons seem to stem from the classic reverse-migration of white collar workforces from suburban enclaves to metropolitan districts. Beyond that, the fast-foot behemoth’s business woes might play a role in the decision as well.

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Exec: Renters Avoiding Buildout Costs In California Office Market

Downtown LA's office skyscrapers. Including th...
Downtown LA’s office skyscrapers. Including the Wells Fargo Center and California Plaza Towers. (Photo credit: Wikipedia)

The imposition of energy efficiency standards for new and altered commercial buildings in California is helping to stoke the fires of a hot landlord’s market in offices, says one Los Angeles-based property exec.

At issue is the 1978 California law called Title 24, which aims to decrease the environmental impact of buildings. The law’s requirements impose costs on buildout and tenant improvement plans to the point that, according to Jim Proel, EVP of PM Realty Group, office tenants facing sub-10% vacancy rates are increasingly going the other way — toward longer lease terms with somewhat stiffer annual rent escalations than would be popular in a different market.

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Detroit Shifts Gears To Technology

A pair of articles today explain a new renaissance in Motor City commercial property and infrastructure centered on technology business expansion. Together they point out how this isn’t the economic and cultural stretch one might think for the town that so famously put its industrial eggs into one auto-making basket – and saw globalization and capital flight devastate its fabric when that industry chose foreign labor.

In Dan Rafter’s piece at REJournals.com Detroit A Tech Hub? You Bet the report mentions the recent Jones Lang Lasalle’s US Technology Office Outlook report that ranks Detroit among the top 30 in the US for total leases to the technology business.

You might be surprised to learn that Detroit has become a top target for tech start-ups. JLL in its U.S. Technology Office Outlook report ranked the city as among the top 30 in the nation for total tech leasing. What makes Detroit so appealing for tech firms? JLL pointed to low real estate costs, an affordable cost of living and a competitive pool of talented employees.

These factors are inspiring technology start-ups to open their doors in the Motor City. According to JLL’s research, the Detroit market is now supporting 50,796 tech jobs. JLL says, too, that Detroit’s high-tech employment rate is growing 4.3 percent each year.

The Detroit market has been home to some significant tech lease transactions. Griffels recently renewed its lease of 67,934 square feet in the Mars Corporate Center in Southfield, while Logicalis took out a 40,500-square-foot lease at 2600 Telegraph Road in Bloomfield Hills. Lochbridge recently took out a 29,000-square-foot lease at 150 W. Jefferson Avenue in Detroit’s CBD.

Electric Cars And A Fiber Freeway

Adding to the resurgence is more technology, both in infrastructure and in manufacturing target. Ford Motors has recently decided to invest $4.5 billion in the manufacture of electric and hybrid cars by 2020, which adds to the tech resurgence.  As reported in GlobeSt. by Brian Rogal:

“One of the things that people don’t realize about Detroit is that the auto industry is heavily dependent on the high-tech sector,” Dave MacDonald, an executive vice president ofJLL, tells GlobeSt.com. And the recent decision by Ford to invest billions in electric vehicles will further boost the need for tech workers.

Another big factor bolstering technology companies here is the presence of Quicken Loans and its family of companies, which have bought up more than 80 downtown properties, many of them 75 to 100 years old, the type of structure most favored by tech-savvy millennials. “Quicken is really a tech company,” MacDonald says, and it has filled these buildings with about 13,000 workers, helping to send the CBD’s vacancy rate into a historic plunge.

And last month Rocket Fiber, a Detroit-based fiber-optic provider that is part of Quicken’s family of companies, has just activated an internet fiber ring for the city’s downtown that at an affordable price offers connections 1,000 times faster, MacDonald says. In its latest report on the US technolgy sector, US Technology Office Outlook, JLL compares it to “the Google Fiber model that spurred business and startup activity when it deployed in Kansas City.”

Affordable commercial property options and 21st century infrastructure in a great American central business district is the kind of news Detroit – and office tenants eyeing it – can surely use.

Humor From McSweeney’s: Let’s Take This Open Floor Plan to the Next Level

There’s something of a trend war going on today in office layout. Tenants of course want the most from their expensive space, but what does “most” really mean?  Before the rise of the Silicon Valley-style open floor plan layout craze inspired by Google and the like, getting the most from office square footage meant cramming as many cubicles as possible near traditional conference rooms and corner offices with doors.

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