Part Three of a Three Part Article

Service Business, not in the business of investments, real estate, risk, cash-flow, or wealth-building. We established the concept of an Office of Tenant Customer Service, and asked ourselves “What would this accomplish?” Think of the immense possibilities! Not only would establishing an Office of Tenant Customer Service likely create a rock solid forum on which to build landlord - tenant relationships, but it could result in:

Andrew B. Zezas, SIOR Relationship Manager, Strategist, President (908) 245-5999 x11 andrew.zezas@realstrat.com

• Word-of-mouth (pronounced "FREE and POWERFUL") marketing among executives of neighboring tenant companies and the commercial real estate community about the quality Tenant Service provided by a higher-caliber landlord
  
  
• Lower vacancies and higher tenant retention rates
  
  
• Justification for higher rental rates
  
  
• Strong and more predictable cash-flow, and a greater likelihood of creating wealth
  
  
• Relationships with executives that could open-up other, more lucrative opportunities in real estate or other business areas
  

....oh, and that little thing called GREAT TENANT SERVICE!

A Radical Change

Here's another, and this one's big! Landlord lease documents have gotten bigger and bigger over the years, with some New Jersey offices leases, for example, exceeding 100 pages. Leases set forth the rules of engagement during the lease term, the responsibilities of all parties, and they include detailed descriptions of what will happen upon lease expiration or when one or more parties default. This is all very important given the financial magnitude of some leases.

A100 page legal document, while necessary in many cases (and unnecessary in some), creates less than a feeling of good customer service when presented to potential tenants. The negotiation of lengthy documents creates the need for armies of attorneys, accountants, and other professionals to spend many hours negotiating the same terms over and over again. This is true for both landlords and tenants, and results in tremendous cost to both sides.

So, how can commercial landlords minimize the efforts and costs required to complete tenant leases while providing excellent Tenant Service? One alternative may include dispensing with the entire concept of leasing for some tenants, and instead creating simpler, much shorter Occupancy License Agreements. Such documents could be based on pre-determined reasonable standards and policies that would simplify and shorten pre-occupancy negotiations, the lengths of the documents required, and the corresponding costs to all involved.

Occupancy License Agreements might not work for all commercial landlords, nor for all tenants, but may provide a means for quicker, simpler, and more profitable transactions for smaller tenants and others. Some of the most progressive commercial landlords are considering the concept of Occupancy License Agreements. Occupancy License Agreements could create the foundation for forming better relationships between landlords and tenants, when landlords employ such an approach.

It's The Experience, Silly!

What we're really talking about here is a means for commercial landlords to enhance the experience that companies and their executives will enjoy as occupants of a particular building. Would you pay more for a better meal, a better hotel room, a better car? Of course you would, if during the event and afterward you felt that the experience, not just the results, were worth the price and that you received at least what you expected, and more.

Yes, commercial landlords are in a risky and challenging business. But, they also have an opportunity to achieve even greater success by truly focusing on the needs of their tenant customers and the opportunities that such a focus will present.

Commercial landlords, what business are you really in? The best of you, and your tenants, know that you're in the Tenant Service Business.

Andrew B. Zezas, SIOR, is Relationship Manager, Strategist, and President & CEO of Real Estate Strategies Corporation, Publisher of "Business, Profits and Strategy", a monthly online publication read by thousands of business, financial, and real estate executives nationally, and, is the author of two new real estate books, The CFO's Guide to Understanding Corporate Real Estate Transactions and The CFO's Guide to Hiring the "Right" Real Estate Service Provider, both of which will be available shortly at www.thecfosguide.com.

Mr. Zezas is well-known for his ease and informative style of public speaking, and has given talks, presentations, and has lead educational programs for business, professional, government, and trade associations, including the Building Owners and Managers Association, American Management Association, the U.S. Postal Service, RealComm, Society of Industrial and Office Realtors (SIOR), and others. Andrew is National Chairman of the SIOR Tenant Representation Specialty Practice Board, and is a licensed real estate instructor in Texas and Indiana. He can be reached at 908 245 5999 or via email.

Real Estate Strategies Corporation, located in Kenilworth, New Jersey, and serving clients throughout the country, helps companies create and execute Business DRIVEN Real Estate Solutions...and Opportunities, faster and with less risk. Visit www.realstrat.com.

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