Lessons Learned from Real Estate Recession
May, Bill, THE JOURNAL RECORD
If anything positive came out of Oklahoma City's real estate recession of the past few years it's that building owners and managers have learned a valuable lesson, according to Gary Brooks, office lease specialist for Jerry Hocker & Associates.
"The hard times have forced building owners and managers back to the basics of taking care of their tenants," Brooks said. "They have learned that if you take care of your tenants, they will stay with you. That is, the people still in business have learned that.
"People who never learned that are not in business now.
"One thing the bad times did for us, it got rid of all those poeple who just came in to cash in on a fast buck. Back in the early 1980s, when there just wasn't enough office space, we got a lot of people from other states who set up shop and ran things the way they wanted. They didn't care about their tenants, now they're out of business." Competent building management rates such a high priority on Brook's list of desirables in leasing space that he often advises clients to pay more rent in a particular building, just because of a certain management company, manager or owner.
"I honestly feel that owners can justifably charge more for buildings that are well managed," he said. "When I'm helping a client find lease space, I always advise going where the best managers are, and often those are the buildings with the higher rates." While tenants are finding happiness with better building managers, these same managers have learned that happy tenants make happy owners.
"We've got a lot of activity going on right now. It's mostly local business expansions and people moving, just jockeying for position because they realize the market is about to go up and they want the good leases now," Brooks said.
"But, if tenants are happy where they are, if their needs are taken care of and the manager treats them as if they are important, they may not move. That means the manager doesn't have a vacancy to fill.
"That means if the building manager will take care of his tenants, they will stay with you." With a lot of activity in the market, and the occupancy rate slowly moving upward, higher rents can't be far behind. In fact, it's already occurring in the better-maintained class A buildings, which have a higher occupancy rate than other classes of buildings, Brooks said.
"As these buildings fill up with expansions, people wanting better space at a good price, new businesses moving in, then that's going to affect the entire market," he said. …