Subleases have always been a flexible way to secure affordable business real estate, even in healthier markets than the one we are experiencing. Still, subleases do present some drawbacks, such as being subject to the terms of the original lease, having to wade through multiple levels of approval for service requests, the risk of eviction should the original tenant default and being limited by the existing physical layout of the space.

However, today’s sublease market is providing opportunities that easily outweigh the drawbacks. Primarily, rates for well-appointed space in great locations are, in many cases, hard to believe. Many sublease options also include an array of value-adds, like furniture, high-end conferencing technology and phone systems. 

Many landlords are in difficult financial positions as a result of the lending industry’s inability to re-finance billions in commercial real estate mortgages. Thus, to put it mildly, property owners are very open to negotiation, as are the tenants offering the sublease.

Unfortunately, this recession will be known for how dramatically it has swept through our country’s industrial foundation. One day, a company is whole and stable; the next, shutting its doors. Thus, if you can prove long-term stability, you can become a very attractive option for both a company needing to stop the bleeding and a landlord needing income. 

Recently, we helped a client with a sublease that secured them an impressive space at a very attractive rate. Upon scouring the market on their behalf, we found that many first generation options simply couldn’t compete with the flexibility, price and terms of a sublease. Additionally, upon expiration of the sublease, our client will be in an ideal position to negotiate an almost as equally favorable direct lease. In essence, the sublease works in their favor as a “trial run.” And, in today’s market, a proven tenant becomes a valuable asset to a landlord.

We would be glad to answer some questions for you about what’s happening in today’s market from a tenant’s perspective. We understand that there is a lot to be confused or just curious about, given the rollercoaster-like fluctuations in the market.  Next month, we’ll touch on the concept of “blend and extend” and how it could help you safely “lock in” your space for the next few years.

Like any integral component of business, your use of office space requires careful planning, timing and expert insight. There is no shortage of case studies I could cite that illustrate this notion, from both the perspective of the quickly growing company and the one, unfortunately, that is on its way down. 

Thankfully, the story I’m sharing this month involves a company that I believe is smartly run and cognizant of the impact a well-orchestrated occupancy plan can have on growth. 

I received a call from a current client interested in a meeting. While I was unaware of any imminent space needs, I admit to being somewhat apprehensive about the prospect of having to discuss a disposition plan. (As most of you know, today’s economy can change our plans in a hurry.) However, as it turned out, my client wanted to simply integrate future real estate needs with their ongoing strategic planning. Perfect! 

This company does not have an immediate need for space but instead was seeking insight on how to best leverage their real estate for growth needs a couple of years out. We toured their facility, discussed market conditions, employment goals and how operations interacted with their facility. 

In conjunction with performing a current market survey, I now know how to view ongoing market availabilities and conditions with their needs in mind. This is as smart a business decision as any company can make today, especially given the Triangle’s real estate market.

Because of my client’s foresight, they can make critical business decisions with a full plate of data in front of them. And, they are already a step ahead of their competition. Like a builder getting site plan approval well ahead of breaking ground, my client is now poised to pounce on the market when the timing is right.

Our case study this month features another client who took the proper approach toward long-term real estate planning. Two years from execution, we researched market options, including existing buildings, purchasing and build-to-suit alternatives. When the time was right, they were able to move quickly with confidence, moving in to their property in only three months after submission of the offer to purchase. Read more about the Advanced Plastiforms case study (and others) on our Web site.  

Remember that your real estate partner is a valuable connection throughout all stages of occupancy, so feel free to give us a call about strategic real estate planning.  We look forward to hearing from you!

For me, that current focus is RED Day, a nationwide charitable mission of Keller Williams that challenges local offices to give back to the communities in which we work. 

This year, Red Day is Thursday, May 13.

Short for “Renew, Energize and Donate,” RED Day was created to unite Keller Williams Realty offices and associates in an international day of service. Last year, more than 25,000 KW associates donated 130,000 hours of service to their respective communities, helping in food and blood drives, liter pick-up and assisting in nursing homes, among countless other community-oriented projects.

The goal of our committee, on which I am excited to serve, is to connect directly with those we decide to help—we don’t just want to give money or present something intangible. In order to really support a cause, you need to believe in it; you need to get to know it.

We have decided to offer a range of facility care services to Meals on Wheels, Easter Seals UCP of NC and Aversboro Assisted Living of Garner. In addition to spending precious time with the recipients of each organization’s efforts, our team will be working with students at NC State’s School of Design to implement landscaping plans; painting teams will tackle interior projects; and we will also fix and install tile flooring.

Meals on Wheels is the most recognized effort in America feeding the hungry and homebound elderly while Easter Seals UCP of NC offers comprehensive support to families with disabled children and ongoing assistance to disabled adults.

Aversboro Assisted Living of Garner is a regional assisted living facility helping the elderly and infirmed live a healthy, independent and full life.

Reaching out and really connecting with organizations that operate on the fringes of our fast-paced business world will certainly be an eye-opener. Needless to say, I’m very excited to see this focus reach fruition.

Efforts like this are why I chose to align myself with Keller Williams. Companies should care about the areas in which they serve, and I am very thankful to work in one that does. We are proud to be involved with each of these organizations and know we will get back way more than we will give.

My industry is quite abuzz with talk about how to improve bottom lines. It became even more evident in our most recent TCREW (Triangle Commercial Real Estate Women) meeting that focused on a topic to which we should all starting giving serious consideration: sustainability.

Sustainability is about helping our environment, and our communities, prepare for the future and thrive in the present. Our meeting included a panel of experts that understand how focusing on sustainability can strengthen business.

Panel moderator Evelyn Contre, Founder and Managing Director of Springleaf Strategies,discussed how companies can realize significant financial advantages and increased brand recognition by implementing a few sustainability initiatives.

Springleaf Strategies is a consulting firm that assists its clients with executing sustainability-focused marketing plans.

Evelyn discussed client success that stemmed from improving building energy efficiency, resource conservation efforts, local purchasing and community reinvestment projects.

She also delved into the value of employee engagement, showing us how her clients realized increased productivity, fewer absences and a bolstered sense of community within the company simply by committing to sustainable causes, giving employees a greater sense of purpose beyond their daily responsibilities.

Panelist Beth Richardson, Director of Financial Services for B Lab, discussed her firm’s efforts in the establishment of B Corporations, which are 501(c)3 organizations in business to primarily benefit environmental or social causes.

B Corporations stand out from other “green-minded” companies because they meet a set of strict standards that legally hold them to their causes. Transparency and shareholder interests are critical facets of a certified B Corp.

I encourage highly that you visit www.bcorporation.net to take B Lab’s impact rating survey to determine your company’s social and environmental impact.

Alyssa Farrell, another panelist and Manager of Strategic and Sustainable Solutions for SAS Worldwide Marketing, referred us to a couple of helpful Web sites, namely www.globalreporting.org, the Web site for the Global Reporting Initiative, which created the most widely used framework for analyzing sustainability efforts; and www.ghgprotocol.org, the Web site of the Greenhouse Gas Protocol Initiative, a highly reputable accounting tool by which companies quantify and administer greenhouse gas emissions. She also shared how SAS has become a leader in this endeavor through their wind farm and making modifications to the buildings they own.  She urged the importance of the buy-in by the employees by getting them involved in the process.

Follow Alyssa’s bog on sustainability and strategy issues at http://blogs.sas.com/sascom/index.php?/authors/44-Alyssa-Farrell

Earth Day is April 22. It’s no longer a day just for environmentalists but a day for businesses to strive to make changes that will better where we live, work and play. Make a commitment to see how your company can make a difference in its carbon footprint.  Together we can make a huge difference in the sustainability of our planet. 

It’s time to connect with a cause that will benefit everyone.

Connecting with people is about communication. Whether at an event, in a meeting and in today’s ever-networked world, via the Internet.

Well, thanks to a group of former Microsoft employees and, should you have any doubt, the folks at Google, a tremendous new technology has been developed that is on the cusp of changing how we connect with one another in the workplace. It’s called Docverse.

Since the rise of the networked office, teams of professionals working on critical documents, even in the same office, have been e-mailing drafts and corrections back and forth. From RFPs, to leases, addenda and other mission-critical documents, such as the strategic plan for NAWBO Greater Raleigh Chapter, where I serve as a volunteer, we do it all the time.

As is common in this process, versions become confused, debates arise about changes and by the time we have amassed 50 messages, little progress has been made. Sure, there are change tracking tools in MS Word, but sometimes, don’t you just want to talk about it?

Now you can.

Docverse has simplified desktop document interaction. You can literally chat with team members while viewing the same document. You can input changes simultaneously and actually discuss them! (So it even incorporates the element of human connections.)

The company calls it simultaneous group editing. Even when working offline, any saved changes are uploaded to the online copy, so it is up to date every time. Plus, it records every change and keeps previous versions. Docverse downloads really easily and can be turned on whenever you use Word, Excel or Powerpoint on your desktop. Your time to preview the 5-minute demo is well worth it—you’ll be surprised at how easy it looks.

It appears that this tool might finally enable true team collaboration. I believe that tools like Docverse play an important role in making our work environments more productive. But even when working together online, core communication skills must always be practiced. Respect for each other’s input, listening and contributing ideas that are focused on team goals, not individual needs, is what creates a truly connected workplace.

Thanks for reading! Stay connected.

Some people call it networking. I like to call it making connections.

Networking, in the common business sense, is typically predicated on the need to just fill up your Outlook address book. We’re programmed to methodically work our way through business events, stopping at pods of people to fill up on business cards like a rest stop along the highway to success. It’s just how we have always done things, right?

In truth, our path to what we want out of business—and life—can be greatly enriched if instead of just filling up and rolling on, we stayed and looked around for a while. That way, we can better understand who a person is and maybe where their route is taking them; perhaps you’re headed to the same place. In other words, we need to make connections, not just contacts.

I understand this concept more every day. I believe that in making these connections, we can become passionate about others’ reasons for working and living; an idea that inspired me to share with you a recent meeting that preempted a whirlwind of dramatic events for a very good friend.

Last month, just before the country of Haiti was literally shaken to its core by a tremendous, life-altering natural disaster, I was sitting comfortably at Neomande in West Raleigh with Miles Wright, the open-hearted and dedicated co-founder of Hearts with Haiti, a non-profit supporter of several Christian boys homes throughout the small Caribbean country. We were discussing The Path, the book I shared in last month’s newsletter that helped me clarify my life’s mission. It was an engaging dialogue, especially for Miles, who seemed to be facing a time of decision in his own life. However, little did either us know that the consequences of the impending events in Haiti were going to make some short term decisions for him.

To discuss in this newsletter Miles’ rampant execution of a rescue expedition to Haiti to save a close friend would be to do a disservice to a News & Observer article  that captured it nicely.

The earthquake in Haiti has touched many of us. So I would like to recommend that you visit not only the Hearts with Haiti site but also Hearts and Hands for Haiti, another terrific Raleigh based non-profit that supports three schools in Haiti. I have known and worked alongside the family behind this great effort for a number of years. Many of you have likely been on Mission trips with Stan Wiebe, who was in Haiti when the earthquake hit. With more than 1.5 million children displaced, Stan’s group will no doubt be greatly appreciated by the people and government involved in the country’s reconstruction. 

Speaking of “Hands,” our Case Study this month exhibits another connection I made through NAWBO-Raleigh  with fellow member, Elizabeth Laurino, co-owner of Hands on Health, a massage therapy business we assisted with locations in Cary and Raleigh.

Thank you for reading. Until next month, keep connecting.

It is no accident that our new newsletter is titled “Connections”. During the holidays, I read The Path: Creating a Mission Statement for Personal & Work Life, a book my Keller Williams coach recommended. After 20 years with a single focus in business I thought our mission: “To provide services that create value for our clients and inspire their loyalty” worked well. The book forced me to dig deeper and find something that really speaks to me at a soul level. The result was:”I, Michelle Rich Goode, connect with people, inspire their dreams and motivate their actions to help them realize their potential.”

I shared this statement with my good friend and valued client, Sepi Asefnia of SEPI Engineering Group. She immediately got it and shared “it is absolutely who you are.” I felt it instantly as I remembered our first connection was getting her involved with Triangle Commercial Real Estate Women (TCREW), and later hearing her dream of one day owning her own building. That vision became a reality in 2006 when she bought and renovated her building at 1025 Wade Avenue. I now realize what excites me most is truly getting to know clients on a personal level, hearing their stories and facilitating their actions. It is more than representing our clients interest in leasing office space or selling them a building. That is the byproduct of what we do, but we do it in such a way that we truly become a strategic partner with our clients.

A sincere thank you to all of you that we have been privileged to represent and who we define as our strategic partners. You have helped make us successful, continue to do business with us and recommend Rich Commercial Realty to others. I know we will connect with other clients who desire this kind of partnership and 2010 will be an amazing year for us and all of our strategic partners. Cheers!

-Michelle Rich Goode

Tammy Campbell, Co-Owner

Hands on Health

The Situation
Advanced Plastiform, Inc. (API) specializes in custom plastic thermoforming for a range of industries and needed new warehouse space to handle expanded manufacturing operations. They approached Rich Commercial Realty/KW Commercial with the challenge to locate a facility of at least 50,000 square feet. API was open to new construction or an existing building; however the new site would need to offer enough space to expand in the future.

The Solution
Rich Commercial Realty simultaneously began a comprehensive market survey of existing warehouse space in the area between Eastern Wake County and into Franklin County while searching for unimproved land that would accommodate new construction in the same area. Agent Tripp Lineberry reached out to his contacts to receive bids for new construction to have ready should API select an undeveloped site. After locating an existing facility in Zebulon that was listed close to the goal price, Lineberry moved quickly to ensure due diligence was completed prior to a formal contract to keep the deal moving forward according to the client’s aggressive timeline. Lineberry kept in close communication with both buyer and seller’s agent throughout the process to ensure required improvements were completed on time so that API could receive accelerated depreciation, which was the key to finalizing the deal.

The Result
Rich Commercial Realty negotiated a significant price reduction and inclusion of office furniture and fixtures in the transaction. API finalized the purchase in time to earn accelerated depreciation and purchased the building at nearly half the cost of what they were looking to spend for a similar space in Raleigh.
 
“Rich Commercial Realty was forward-thinking and went above and beyond what was expected of them to maintain our timetables, which was imperative in getting the deal closed,” said Chris Jolly, owner of Advanced Plastiform, Inc. “They were professional and always available. I felt like our company was their number one priority.”

The Situation
Easter Seals UCP North Carolina and Virginia, based in Raleigh, is a lifelong partner to families managing disabilities and mental health challenges. The nonprofit serves more than 17,000 individuals and their families annually, enhancing the quality of life for individuals and maximizing their potential for engaging in the communities. Easter Seals UCP approached Rich Commercial Realty/KW Commercial with the need to consolidate space between two offices in the Raleigh area. However, the leases expired at different times, complicating the timeline for consolidation. The cost to relocate the offices would need to be a cost factor in the analysis of the transaction.

The Solution
Rich Commercial Realty first developed a market survey of 12 properties that fit the needs of the client and obtained Request for Proposals for the top three properties. By positioning the final properties against one another, Rich Commercial Realty created a competitive atmosphere to secure concessions from the landlord. In order to allow both offices to vacate their current space at the same time to reduce moving costs, Rich Commercial Realty negotiated a hold-over at the same rental rate for the lease that expired first.

The Result
Rich Commercial Realty delivered a 23% savings from first proposal to final lease on Easter Seals UCP’s new space. Additionally, the new lease included significant concessions: free rent, assistance with moving expenses and improvements. The client has all Raleigh-area resources under one roof for streamlined operations.

“Rich Commercial Realty was a tremendous resource for us,” said Connie Cochran, Executive Director of Easter Seals UCP. “We would recommend their services without hesitation.”