Originally published in the March/April 2017 issue of BOMA Magazine — Relationships are complicated. Between love and hate, there are many nuances of need and desire that often go unexpressed and can ultimately damage an otherwise solid commitment. Just ask Dr. Phil. Or the tenants in your building.
That’s right. They, too, have needs or wants that often go uncommunicated, and for many and varied reasons that don’t require a private eye to uncover. Maybe the relationship never advanced beyond the basics of maintaining the lighting and cleaning the rugs. Maybe you, the property manager, could never find time to sit down with the tenant and strategize long-term goals. Maybe the tenant couldn’t articulate a coming need.
Or maybe they just didn’t want to rock the boat. “There can be a hesitation on the part of the tenant to complain, especially when most things are going well.” So says Joe Markling, CPM, RPA, the San Antonio-based executive director of National Property Operations for USAA Real Estate Company.
Cushman & Wakefield tenant Jeighdeane King agrees. She’s facilities manager at public relations giant Ogilvy’s Washington, D.C., office, and she thinks it goes a bit deeper than that. “You never want to be a big pain in the butt,” she says, “but I think a lack of communication is often because tenants just give up.”
She has a tight working relationship with Ogilvy’s current building manager, Cushman & Wakefield, but past relationships with previous property management companies found her doing just that: giving up. For instance, a former employer of hers was once the first tenant in a new building and, she recalls, the sun rose and set by them—initially.
But as soon as additional tenants moved in, responses to emails and work tickets stopped, and “it got to the point where I wouldn’t hear from building management for days, so I began to ask, ‘Why even bother?’” The specific issue was temperature control, King explains, and a simple response to her pleas “would mean the people who were there trying to make money for the company could do their jobs and not freeze at their desks.”
She says coworkers were bringing in gloves to compensate for the lack of heat. “We modified our behavior because management wasn’t going to change theirs,” she says. “That’s just lazy.”
King also has met a lack of response (and ultimately gave up asking) over such relatively small things as modifying a billing statement for clarity’s sake or—always a fan favorite—proper bathroom maintenance. “I know they were busy, but this was their job.” All reasons why her current, accessible relationship with Cushman & Wakefield makes her so happy—and her role overseeing Ogilvy’s workplace so much easier.
The Survey Says…
The evidence is clear: Tenant surveys are an invaluable part of management relationships. There can be surprises, however, in what they do reveal and what they don’t. This is especially true if the tenant won’t open up about their needs. As a result, something that’s been brewing in the occupant’s head for a while can suddenly pop out.
“You can find out all at once that, even though you thought things were going pretty well, they’ll bash you pretty hard on those things they want or need but didn’t communicate,” says USAA’s Joe Markling. “Immediately, you call the tenant and say, ‘Where the heck did that come from?’”
Providence’s Andrew Romerdahl calls it a snowball effect. “A seemingly meaningless thing over time can become a big deal if that’s the tenant’s pressure point, and it comes out in a survey—or worse, when you go to renew.”
On the flip side, there’s a question of nuance. From the tenant’s perspective, Ogilvy’s Jeighdeane King says the surveys are good for the “overall happiness” or dissatisfaction quotient, but they don’t really do a deep dive into specific issues that might still need to be addressed. Romerdahl agrees: “Surveys are meant as a barometer and won’t get into the nitty-gritty details. You toe a fine line by distributing surveys. You’re asking a tenant to fill out something that will benefit you, and they might see it as a benefit to them or just one more thing to do. So you streamline it for them, and try to interpret the results as best you can.”
It is hoped, he says, that building managers can read the direction and use that “as a reason to kick off a discussion.”
Can Ignorance Be Bliss?
Sometimes, rather than giving up, tenants just don’t know enough to ask in the first place. Andrew Romerdahl, MAI, CCIM, senior regional director of Real Estate and Construction for Providence Health & Services in Anchorage, Alaska, says, “It’s typically assumed that tenants should know the basics of how a lease works, but that’s not always the case. And not knowing, they hesitate to ask.”
And the things they fail to ask about are usually the mundane, basic things, such as new equipment that needs different electrical service or carpeting not included when the tenant and landlord were negotiating the lease. “You almost want to provide them with a checklist of the things they shouldn’t forget,” says Romerdahl, “but you’ll never have all of the particulars of every lease on that list.”
If, for whatever reason, tenants stand silent on the essentials, just imagine their hesitation over requests they consider beyond the norm. “Too many tenants think their property management company won’t be open to certain ideas, or they get it in their heads that the way to meet their needs is simply by going someplace else,” says Larry Gamache, director of Communications for Carfax in Centreville, Virginia. Don’t let his title fool you. He is a liaison between his company and Cushman & Wakefield, the building manager for Carfax’s corporate headquarters space, and he helps maintain the brand and corporate culture—both of which figure heavily in this relationship.
“The thing most tenants are afraid to ask is, ‘What should I be doing?’,” he explains. “Who thinks to ask the building manager about a problem with morale or turnover?” That’s right. More than ever, serious, proven connections are being made between workspaces and employee retention. Everything from interaction and collaboration to foosball tables and nap rooms today enter the layout conversation, dropping such issues as morale and turnover directly on the lap of the building manager who is—or at least should be—up on best practices in commercial office applications. This is especially true of operations for companies like Carfax, Google or Amazon, which are attracting a more youthful cohort to their employee roster.
A tenant that defines the building manager simply as keeper of the thermostat is not only behind the times, but poses “a real Catch-22 for the manager,” Gamache adds. “A tenant may get in their head what they need, but they don’t see that solution in their current space and can’t see a path to getting there.” And, yet, a simple conversation with the people in the best position to help them never takes place.
Gamache provides the example of a corporate campus, all the rage these days for companies like Carfax that need to promote a sense of community as a path to employee happiness and, therefore, retention and productivity. “Rather than speak with the building manager about options beyond what they perceive the manager can handle, a company might simply relocate,” he says.
No such disconnect exists between Carfax and Cushman & Wakefield, which Gamache describes as “really supportive and very helpful. We feel pretty comfortable telling them anything, but I do know other tenants in other buildings that have a difficult time talking to their building management.”
In other words, both Carfax and property management work at it. “A good property manager—and hopefully all of our managers—will be proactive and ask tenants if there’s anything they need that we don’t currently provide,” says Benjamin A. Comm, Cushman & Wakefield’s Washington, D.C., metro region senior managing director. The Carfax headquarters is in Comm’s bailiwick.
On the flip side, Gamache doesn’t hesitate to get on the horn with his building manager—Cushman & Wakefield Vice President Kathleen Boxall—whenever need dictates. It’s the extent to which they do it that matters.
“We like to discuss challenges with our property manager and brainstorm solutions,” says Gamache. “We consider them part of our team. We always make decisions using the wisdom of crowds, and they’re a big part of that.”
Certainly, for most common issues, tenants are very upfront and won’t miss a beat when communicating with management. That changes when “the tenant doesn’t realize that there are services that are potentially available,” says Comm. He tells of a building in Bethesda, Maryland, that was lacking amenities a large existing tenant wanted: “We said we’d put in a new fitness center, a coffee shop in the lobby and some other amenities. They did re-up,” to the tune of 147,000 square feet, which was signed this past December.
This, says Comm, was an exercise in anticipating needs and brainstorming with the tenant. “Between my management and leasing teams, we offered those ideas and we enticed them to stay.” Romerdahl nearly lost three tenants at once to silence. “One of the most frustrating things on the landlord’s side is when you don’t retain a tenant because of something they thought you couldn’t provide and never asked you about,” he says.
“Three physicians groups either assumed or had been persuaded that they couldn’t expand their practices on our campus, so they got together and were planning to build their own medical office building. I met with them just in the nick of time—during the renewal period—and they said they wouldn’t renew because we didn’t have enough space to offer them.”
But all the while, adjacent space could be made available. “It was occupied by our internal users,” he says. “I called a time out, and we put together a three-way blockbuster deal: I moved two or three of our internal folks and paid for an external tenant to move.” The physicians all reupped for deals ranging from seven to 10 years and totaling just under 50,000 feet—at $45 a foot. “I would have lost the revenue and the synergy of three prominent physician groups on campus because they didn’t see a ‘For Lease’ sign and didn’t ask,” notes Romerdahl.
The Fault Lies In Ourselves
Like a married couple that can read each other’s thoughts, a sharing relationship between tenant and management is a union made in corporate occupier heaven. But, as Gamache indicates, it’s not always that way. And it seems everyone—tenant, property manager and even building owner and the suits in the tenant’s C-Suite—can contribute to a lack of professional intimacy.
For the tenant, “you need the willingness to have that conversation with the building manager in an open, transparent dialogue,” says Gamache, “without some of the games that sometimes revolve around corporate real estate.” This is especially true when needs beyond the norm demand “an honest conversation about the corporate goal and less about the particular features of the building,” adds Gamache. “Too often, that relationship gets defined by perceptions of what property management is, so the conversation stops at lights and heat and snow removal.”
For the manager, it could be a simple case of overwork, leading to what USAA’s Markling calls the commoditization of property management. “The beauty of technology is that there are apps for so much of what we do,” he says. “Tenants can send in a work order and receive notice that it’s been delivered and then a notice when the work is completed. Everyone’s happy, but there’s no relationship. We’re getting very efficient in all things but that.”
So some responsibility for the relationship not advancing to the point of open communication falls to the building manager—but only to an extent, according to Markling. “There’s no excuse for an on-site property management team to not have that sort of relationship with tenants,” he says. “If I’m touring a building with an on-site team and the tenants aren’t asking them how their sons did in last night’s basketball game, we have a huge problem.”
The dynamic shifts a bit when the focus turns to third-party managers, who, notes Markling, “are often stretched with so many properties to manage that they can never get away from their desks.” And here’s where ownership is called on the moderately vacuumed carpet for creating a death spiral. An owner or investor “might take on two new buildings and assign these to the property manager without paying much more or adding more people,” he explains.
A Dire Cause and Effect
“The fees get beat down so far and the managers are forced to run thinner and thinner,” Markling continues. “They don’t have the time to develop a relationship with the tenant, and so the tenant won’t tell them anything. They see the manager as the rent collector and the people who fix the heat.” This creates a dire cause and effect: “If you’re not going to pay for the service, you’re not going to get the service,” he explains.
There’s one more contributor to the disconnect that hampers relationships—the tenant’s C-Suite. An attentive body of decision-makers can be a beautiful thing. Take Carfax. “It’s not just the space in the walls that’s important,” says Gamache. “For us, it’s giving people an experience. Is there a destination? Is there a way our culture can flow from the parking lot to the office?”
Carfax itself actually lived through a re-imagining of the aforementioned campus setting and recently expanded from 50,000 square feet to 100,000. Rather than relocating its corporate headquarters from its building in the Centreville office park, Carfax created a vertical campus, complete with stairwells connecting all four floors in a destination environment. To carry the brand from parking lot to office, the owner and manager collaborated on Carfax’s vision and installed a sculpture garden with picnic tables, a fire pit and a new walkway that guides employees to a campus lake. “All of it was inspired by a conversation we had with the property manager,” says Gamache.
And none of it could happen without sign-off from the C-suite. Without it, another major disconnect arises between tenant and building management. Too often, a tenant’s C-suite is populated with “people who are making decisions about the culture of the space based on what they like,” says Gamache, “and not appreciating the fact that there are newer generations of people joining a growing company that may appreciate different things.” Such things are in the wheelhouse of savvy building owners and property managers.
Ogilvy’s Jeighdeane King agrees. “Part of the responsibility for a broken relationship between tenant and building manager falls to the business owner,” she says.
Obviously, there’s plenty of blame to go around. And, ironically, just one solution, simple in concept, tougher in execution. However, it’s not just communication; rather it also is an environment where open and wide-ranging communication is encouraged and rewarded with action.
“The best you can do is establish and maintain a presence and rapport so a tenant feels comfortable asking,” says Providence’s Romerdahl. “Perception is reality, and if the perception is negative, they’ll relocate.”
After all, why should anyone stay in a relationship perceived to be broken? We’re sure Dr. Phil would agree.
About the Author: John Salustri is editor-in-chief of Salustri Content Solutions, East Northport, New York. He is best known as the founding editor of GlobeSt.com.