Cresa New York recently worked with Year Up, a nonprofit organization that provides support for young urban adults looking to develop their professional careers, to lease the company 38,000 s/f at 85 Broad Street for its new New York headquarters.
Ed Wartels, principal and senior vice president at Cresa and his team were able to reduce Year Up’s need for space by 20 percent after conducting an in-depth analysis of how the non-profit utilized square footage at their three former NYC offices. This allowed Year Up to spend less money on rent per square foot at 85 Broad Street.
The evaluation is a common one for Cresa, who is not opposed to signing their client to a smaller space, if the results of their analysis show that a more modest office size is in it’s best interest.
“When we start an assignment, we always want to first take a very serious look at the business,” Wartels told Real Estate Weekly. “How does the business operate? What are the functions going on? How does that align or not align with their real estate?
“No company wants to over extend what they’re paying for real estate,” continued Wartels. “We’ve been in a rising market for sometime and companies simply don’t want to commit.
“No company ever put themselves in harm’s way by taking too little space, but they certainly could by taking too much.”
While selling a client like Year Up on a 20 percent smaller office layout means a smaller commission, in the long run, that’s more than fine with the Cresa team.
“If you give a client bad advice, you’re going to lose the account,” said Kent Holliday, principal in charge of portfolio solutions and workplace planning for Cresa New York.
“Non-profits are being priced out of the market,” said Holliday who labeled that sector as a prime candidate for Cresa’s services. “It resonates loudly with non-profits and startups that are cash-stretched, but it resonates loudly across the board.”
Holliday said that his clients appreciate the company’s transparency. Referencing the recent deal with Year Up, Kent said that the 20 percent reduction in the lease makes a significant difference when that number is compounded over a 15-year term. According to Wartels and Holliday those savings are generated by a company simply taking what they need; not less and not more.
“When you facilitate a process that allows (clients) to step back and get a good perspective, they see the same things that we see,” he added.