While available office space in Manhattan dwindles as vacancy rates decline, commercial brokers still must focus on marketing to savvy tenants the space that’s left.
Take One Times Square. Centrally located and iconic, the home of the crystal ball drop on New Year’s Eve, it also has outside screens that can proclaim to the constant masses whatever the space’s tenant wants.
Marketing the 111,653-square-foot building, then, one might think, should be a simple task, more about fending off would-be occupants than enticing them. But brokers are launching a marketing pitch as fevered as any luxury condo promo blitz.
“It’s the type of opportunity a marketer is going to invest heavily in,” said Stephen Schofel, executive managing director at Newmark, which markets One Times Square. This marketing, Schofel said, includes an initial direct mailing campaign followed by detailed brochures on the space and phone calls to prospective tenants.
Brokers find the detail and repetition necessary because they often have to shout to be heard above the din of their competition. Marketers bombard prospective tenants with pitches, and it’s tough to be heard amidst the white noise of promotion.
“If you’re marketing to the brokerage community directly, hard marketing like direct mail is effective,” said Diana Biasotti, a director with Cushman & Wakefield. “With brokers, it’s about getting them in to see the space.” When marketing right to prospective tenants, direct marketing through advertising in specialty publications – say, a law journal to reach law firms – can work, she added.
“It seems that the trend in tenant requirements – aside from location, which has always been the most important – has moved toward access to transportation,” said Biasotti, who has marketed space in buildings like the new 505 Fifth Avenue as well as 640 Fifth Avenue.
Tenants also crave knowledge about services and proximity to clients; and they especially want to know about technology, Biasotti said. And, with this, tenants will sometimes picture their office space 10 to 15 years down the road, she said, and want space that can accommodate any technological changes during those years.
On the other side of the deal, commercial landlords want, more or less, one thing: A tenant who can pay the rent. “They want a tenant with good credit,” said Andrew Oliver, managing director of investment banking firm Sonnenblick-Goldman Company. “The cost of re-tenanting is very expensive, and [landlords] want to make sure they are going to have tenants that can stay.”
Before the tenants and landlords reach any financial arrangement, however, the marketing has to have gotten a tenant to the dwindling Manhattan commercial table.
For One Times Square, Newmark presents prospective occupants with an explanatory letter from Schofel, attached to a large glossy brochure, red on the cover, with “Welcome to the Center of the Universe” splashed across it. Inside, a tenant can learn about the area around the building, including how many people pass through it daily (1.5 million) and how many bus lanes roll by regularly (15). The brochure, too, touts the New Year’s Eve ball connection.
“Good marketing materials have to be very clear as to what you’re marketing and what the data is,” Schofel said, “and, generally, very visual, in order to capture the eyeballs of brokers and tenants.”