Facility Planning: Putting the Team Together and
Locating the Right Space
We had hoped to complete the ten-step program designed to help you better develop, implement, and manage your firm's real estate in one or two chapters. The bad news is we found that to be an insurmountable task. The good news is we decided to spend a little more time on steps nine and ten. In chapters describing Sections one-six, we “built the boat.” We determined size, shape, and direction for our voyage. The two steps described in this chapter should be viewed as if you were now steering the boat. Now we're ready for the crew and casting off.
Putting Together the Team
You’ll recall we told you with no question that the first thing you needed to do to start the facility planning process is to find a good broker and sign a contract with him guaranteeing that he will exclusively represent you. With that done, you're ready to put together the rest of the team.
Who else should you hire to help you plan your facility? You will at some time need the following:
For some larger projects, you may also want to interview architects and contractors too. There is no set rule on whether you should use the landlord’s architect and/or contractor or hire your own. We’ve had great results with both.
In most cases, now is the time to start interviewing—yes, interview before you locate a building. It is amazing, no matter how big or small a tenant is, one finds a building only to discover the layout is wrong, the wiring is bad, or the furniture you thought you liked won't fit. If you have all these people in place before you go out looking, it will make the final decisions much more economical.
At a minimum, hire a good furniture dealer. On spec, they should be able to take a floor plan and develop a “furniture plan." This is a layout of how the furniture will fit into your space. While the space may appear great, the layout may be all wrong, thus costing you money in both additional tenant improvement costs and delays.
Finding the Right Space
This is probably where the majority of tenants go wrong. However, you won't, assuming you followed our program up to this point. Remember, we had you determine what you needed (your goals and objectives), how much space you projected to need over the next few years, and what your employees needed in terms of size of space and types of amenities. Now you can avoid most tenants’ traps.
Armed with a contract between you and him/her and equipped with your facility requirement, your broker can now go to every landlord, listing broker, developer, and property manager and let them know your requirements. Because traditional commercial brokerage has been a sort of “track-meet" free for all, very few brokers will do this for you or even understand the process—unless you ask. Their concern with past poor experiences is that if they tell the world about you, some other broker will swoop down and steal you away. But, they have one major safeguard—the contract. If any of those other brokers, landlords, etc. have a potential space that meets your needs, do you think they'll hold back? No, but they will have to go through your broker if your contract reads right.
While many of the large brokerage houses sell tenants on their services by claiming they know the "market" better than anyone, a good broker under contract, no matter what size firm he works for, should be able to pinpoint the market in a very short time. Even a broker from out of town can represent you well, if he understands the process. Don't ever believe that having many brokers represent you will give you a more complete view of the market. Think of yourself as a seal off the Channel Islands of Northern California. Do you think a hungry shark will just swim by because he wants to hold back hoping to find another seal? Maybe you never saw a hungry shark. Of course, you can wait for that next broker to come through the door with a picture of HIS great building that just happens to contain the “perfect" suite. Oh, you remembered he worked for the landlord. Now you're getting it! Simply put, you're bringing your requirement to the market rather than the traditional way of bringing the market to you. Which do you think is more productive? Saving time, or cost efficiency?
Even in a tight market, your broker should come up with a selection of perfect (or near perfect) locations. The tighter the market, the more you may have to bend on some of your wish list items.
The main issues to be concerned about are 1) Who does the broker represent? And 2) Does he know exactly what you are looking to accomplish? With both these issues set firm, you’re in a strong position to go off to the real estate market.