When the Bank of America signed a long-awaited lease to be the anchor tenant in Douglas Durst’s new $1 billion Times Square tower in December, the 1.1 million square foot deal was among the most important of the year.
More than 500 professionals from 70 consulting and other firms and five law firms went full speed on the project for months to get the deal done in the small window of time the bank had to work with given its current lease. Bank of America was represented by Jones Lang LaSalle, and the firm’s John Ryan III did nothing but follow the deal for an entire year.
In the end, Jones Lang LaSalle reaped some serious and broad-ranging business from the bank, which will occupy One Bryant Park under a 20-year lease starting in 2008, said Jones Lang LaSalle president Peter Riguardi.
“We were their advisor, broker, provided development and consulting services and will be construction manager for their space,” said Riguardi. “We will probably be facility manager for them as well.”
In this age of integrated real estate services, that’s no minor matter. Jones Lang LaSalle is well positioned. Riguardi, 42, who joined the firm as head of New York operations nearly a year and a half ago, is similarly in a good spot.
The real estate “lifer” is son of Edward Riguardi, the former chairman of Colliers ABR who is known as “The Dean of Property Management” in New York.
The son learned well from the father, and Riguardi, who completed his first big deal as a college sophomore, has spent a career broadening the platform he inherited from his dad. He served as vice chairman and principal at Colliers prior to joining Jones Lang LaSalle.
While it is not the biggest firm in New York, JLL is truly a global company ranking along with top heavyweights CB Richard Ellis and Cushman & Wakefield worldwide. In New York, JLL has around 60 brokers compared to around 290 brokers at CBRE and 170 brokers at C & W.
But it’s not just size that matters. The massive merger of CB Richard Ellis and Insignia was partly based on the fact that Insignia needed to broaden its business beyond mostly brokerage. Now, Cushman & Wakefield may be searching for a merger partner, according to some executives, to bulk up, and maybe broaden its business.
“We’ve heard rumors, but who knows,” said Peter Hennessey, managing principal for The Staubach Company in New York. C & W had no comment.
Riguardi said JLL has influenced other firms. “Respectfully, I think a lot of firms are trying to emulate the international platform of Jones Lang LaSalle,” he said. But he nonetheless admits to cribbing notes from C & W and CBRE. “I think we have emulated a little bit more of their style in New York in that we are trying to be more market focused and develop more of a market leadership here,” he said.
Post-CBRE and Insignia merger, Riguardi sees the situation thus: “I think right now, CBRE and C & W are obviously the two big market leaders,” he said.
“But Newmark, Studley and ourselves are really trying to gain the most market share,” he said.
Following the CBRE merger, some executives said they were surprised there had been relatively few defection from the company, but added that significant departures could still be in the offing. “I don’t think six months or a year would ever be enough time for people there to evaluate whether they want to make a change,” said Riguardi. “If there were a shakeout, I don’t think it would be this quick.”
Woody Heller, who left CBRE to head investment sales at Studley, said he was surprised by the outcome so far. “To date, the exodus is pretty modest,” he said. “Which is great for them, and a little surprising for the outside world. But it’s still a two-year proposition in which all the people who are going to leave, will leave.”
Meanwhile, in several areas, JLL is closing in or passing the Big Two. JLL’s property management division has achieved phenomenal results, more than doubling in size since Riguardi took over. It’s now second behind Cushman & Wakefield, according to Crain’s. “When we started here, we had approximately 20 million square feet we managed out of our office,” said Riguardi. “We now manage 45 million square feet.” While a small part of that business came over from Colliers with Riguardi, he said, most of it is the result of recent efforts by the company’s “experienced team.” JLL is also the largest construction management firm in the city, with more than 50 people working in that division, Riguardi said. “It gives us another touch point with clients,” he said. As far as what he’s done with the company’s culture, Riguardi said, “we’ve gotten people more on the edge of their chair. We want them out, and want them involved in the community.”
Besides the Bank of America deal in Midtown, which is “going to be a cornerstone deal for people to look to as the market turns around,” JLL also did some big work downtown in 2003, and a total of four million square feet leasing in all of Manhattan, Riguardi said.
In the fifth largest new lease of the year, JLL completed a sublease deal for OppenheimerFunds to take 193,000 square feet at 2 World Financial Center. Working on behalf of Merrill Lynch, the firm has subleased three-fourths of the 400,000 square foot assignment. JLL could also wrack up a huge deal if it is involved in Goldman Sachs planned headquarters just north of the World Financial Center. The company currently manages 3.5 million square feet downtown for Goldman Sachs. Riguadi is mum.
“We’re not allowed to comment at all on Goldman Sachs,” he said.
Riguardi grew up in Staten Island, and trips to Manhattan with his father growing up were spent taking in a building as well as a hockey game or show. “We’d always stop off at a building, and real estate was always dinner table talk,” he said. By the time he was a sophomore at Iona College, Riguardi had a real estate license and completed his first transaction that year when he made an 8,000 square foot lease deal at 60 Hudson Square for a sugar commodities firm. “It was a good start,” he said.
Riguardi then went on to join his father at Williams Real Estate, before going on to found Koeppel Tener Riguardi Inc. with his father, which merged with Abrams Benisch and Riker in 1994 to form Colliers ABR. The two still work together at JLL, his father coming in four days a week and serving as “a senior resource to all our businesses.”
Riguardi has enjoyed the partnership. “We manage it pretty well. He’s a great person first. But we don’t always agree, and that’s fun too,” he said.
“When we disagree we are workers and when we go home, he’s my father,” Riguardi said. “We’re also on different sides of the business so its not like we’re in contact minute-to-minute.”