Giving More Effective Office Tours
by Alice Devine
Two figures stumble down a dim hallway. A navy-suited woman struggles to place a worn key into a lock and braces her shoulder against the unyielding, scratched wood. Finally the door opens.
Inside the cavernous, musty room, her companion's exploring hand fumbles for a light switch. Finally, one lone fluorescent buzzes on to reveal . . .
The classic office space tour—it may last only 15 minutes, but it represents your one-time opportunity to make a potential tenant's coveted "short list" of office locations. Don't waste it.
Know Your Product
Effective leasing goes hand in hand with knowing your project, as well as your competitor's. Extensive knowledge serves two important purposes. First, knowing your project allows you to focus on the prospect and direct the tour in a relaxed, confident manner. You are no longer scrambling for an answer regarding inefficient load factors as you walk down the corridor.
Technology now makes vast amounts of market information easily accessible via subscriptions to on-line companies such as CoStar or Black's Guide, which have often replaced or supplemented traditional marketing information compiled in house. However, market information offered by such data providers varies in quality and quantity. When landlords provide building information to such databases, commentary can also be biased. Even in best-case scenarios, computer databases cannot express the many nuances apparent by actually visiting a property. How does a computer communicate a driver's frustration when searching for space in a crowded parking structure?
Although it can be difficult to take time from a hectic schedule to walk a competitor's building. this field trip is crucial. The most effective managers don traveling shoes. Walk the lobbies, the common areas, any amenities such as cafes or fitness centers, and bathrooms. If possible, visit a tenant suite. Take note of the tenant roster and the tenant layout in the building. Assess the parking and curb appeal of the building. Then do the same at your own property.
By examining properties through tenants' eyes, you will recognize ways to highlight your own property's features. For instance, if I am aware that few of my competitors offer expansion space, I will ask a tenant if its company is growing. Invariably the prospect will answer "yes" (few want to say their company is stagnant). I can then recount several success stories in accommodating tenant growth. This approach highlights a benefit of property while possibly raising a concern about a competitor.
Secondly, product knowledge enables you to develop a positive selling "script" that highlights the best features of your project. The "script" is a brief overview of the property, its location, amenities, existing tenants, and other attributes. There is no need to sell negatively against another property. By drawing attention to the positive aspects of your property, any such comparison is effectively made.
But keep in mind that this presentation should be customized for each prospective tenant. I use an aerial photograph (mounted on lightweight foam board so I can carry it to a lobby if necessary) to describe the property. The aerial (and/or large photograph of the building) orients the tenant and creates a much more polished tour. A visual aid adds depth to the tour, and many people relate to a photograph more than to a long-winded speech. The cliché "show me, don't tell me" holds true.
Using the photo as a prop, I discuss the history and quality ownership of the property, point out freeway access and any local airports, and note amenities (shopping areas, restaurants, health clubs). I unabashedly mention any prestigious store or restaurant in the vicinity. I also note long-term or prominent tenants already in the project. This gives a vote of confidence for the building because another respected company has already chosen this location. (A note of caution here: make sure you know your audience. You don't want to inadvertently tell your prospect that a competing company occupies an office adjacent to the suite you plan to tour! Switch suites if possible.)
This tour script will improve over time, as you memorize its points and learn how to tailor the description and highlight terms of interest for a particular prospective tenant.
Drill yourself on your own property information by making a list of potential questions a tenant or broker might ask—parking ratios, HVAC hours and costs, potential for monument signage, mullion spacing, expansion opportunities, tenant-improvement unit prices, etc. Practice your own responses out loud so you have a smooth delivery. One prominent West Coast brokerage company conducts weekly grilling sessions on local building information. As a result, these well-educated brokers are better able to match space to clients' needs.
Role playing is an excellent way to practice tours. Give a sample tour to a colleague and ask for a critique. Alternatively, find someone who is strong in leasing, and tag along on a tour. Rehearse affirmative answers to commonly asked questions. For example, if you only offer exterior monument signs to tenants leasing over 10,000 square feet, do not simply say "no" to a 1,500-square-foot tenant making such a request. Instead, present an alternative, such as: "You'll have signage on the main lobby director and on your suite on move-in day. We generally grant exterior signage rights for companies over 10,000 square feet. At the rate your company is growing, I'll expect you'll be leasing that much space in a few years."
A Negative is a Positive
In addition to preparing answers to common questions, it is probably wise to anticipate responses to some awkward moments that may arise on the tour. Common incidents include a tenant arriving for a tour but refusing to identify its company name, eight people showing up for a tour when there's only one of you, or a broker questioning you about lease extension commission policies mid-tour.
If a tenant doesn't identify itself, you can assume it doesn't want its search for office space to be public information. Many times these are large or prestigious companies on the verge of critical business changes. While it's not impe
rative to know the company name at this point, you will need information about its business in order to accommodate its needs. Ask defining questions such as: will the type of employees housed in this office drive their own cars or use public transportation (i.e., sales/executives or back office space)? or, do you prefer private offices or workstations?
If a tenant shows up with a large crowd, grab some warm bodies from your office (engineer, assistant). Introduce these members of the management team who will ultimately serve the tenant. Your coworkers can help you divide and conquer—as others converse with members of the group, you are free to direct the tour and focus your energies on the decision makers.
In response to broker commission inquiries that may prompt debate, use a friendly manner to tell the broker you'll give him or her a call that day to discuss any commission questions.
If you don't know how to handle a situation, try to neutralize any interruption so that you maintain control of the tour. Afterwards, ask a strong leasing person how he our she would have handled the situation so that at least you learn for the future. Nothing replaces experience, and with practice, you can learn to turn even difficult situations to your advantage.
Support an effective tour presentation with a good-looking space. See to it that the building and suite look stellar. Tour the suite when it becomes vacant. Is the suite well-lit and clean? Do all the lights work? Do all the (squeak-free) doors work? Has the previous occupant painted the office forest green to remind him of the color of money? Are there reminders of the previous occupant: signage, kitchen debris, junk mail stuffed under the door? Is the stunning puce carpet buckled?
You might have another employee or a local broker inspect the suite and review their comments, particularly first impressions. If a thorough cleaning of the suite is not sufficient, funds may better the suite's appearance. Any improvements should be of a generic type, to add long-term value. Turn on the lights and raise (or open) the blinds prior to the tour so that the suite is bright upon entrance.
Assess any leasing challenges creatively. For example, is the suite located down a long hallway? It may be best to meet the broker and prospective tenant in the building lobby, rather than the broker and prospect trekking a corridor to the management office and then back-tracking to the suite. This solution de-emphasizes the corridor length and gives the tenant a realistic sense of the approach to the suite.
Another challenge may be a suite with a sweeping view of the parking lot. Some attractive (evergreen rather than deciduous) trees or shrubs placed outside the office windows will greatly improve the outlook. When touring the suite, open the levelor slats to allow light, but don't raise the blinds. Market the suite's accessibility to sales offices or to firms with many visitors.
As another real-life example, Cushman & Wakefield listed a building in suburban San Mateo, Calif., with skimpy bay depths (the measurement from the common corridor to the window line) of 23 feet and enlisted an architect to design office configurations. The plans offered several open and private office layouts, which were enlarged and placed in the vacant space on foam board. In this instance, the listing agent anticipated a potential problem and provided solutions proactively.
Lastly, limit the number of toured suites. Tour day can quickly dissolve into a blur of unmemorable buildings for a tired prospect.
Know Your Prospect
One of the basic tenets (no pun intended) of leasing is knowing your prospect. If a broker schedule the tour in advance, you can garner information regarding the tenant's size, business, current location, type of space desired, tour participants, and so on. Once I meet the tenant in person, I ask for information about his or her company and ideal space before I describe the building. This data gives me a starting point to tailor my script on the project and helps me frame other questions that I incorporate throughout the tour.
Linda Miller of Equity Office Properties manages the landmark One Maritime Plaza high-rise in downtown San Francisco. Says Miller: "One of the best indications of a successful tour is when a prospective tenant talks more than I do . . . and provides feedback."
The tenant's self-introduction helps to identify decision makers (and sometimes indicates how much deal control the broker has). I also hand business cards to the prospect separately from the marketing material collateral. A card exchange is a natural business response, whereas a prospect might not present a card if simply given a brochure. I then have the individual's name, title, and pertinent communication numbers.
In addition to the decision makers, I am also looking for the mole, albeit not of the rodent type. The mole is not a decision maker, but he or she generally works closely with the principals and knows the office criteria. Often the mole is an office manager or administrative assistant who is present on tours and is more accessible than the decision maker. Most importantly, the mole gives me information about the prospective company. Because the mole won't be negotiating any lease deal, he or she is freer with information. I cultivate this information over the course of the deal, starting with the tour.
Offering marketing materials at the end of the tour gives tenants something to take away with them as a reminder of the property. While a four-color glossy brochure is impressive, an effective marketing package is not necessarily expensive. A well-executed package should include a scaled 8.5 by 11-inch partition plan of the available suite indicating partitions, doors, cabinetry, and kitchen. Avoid other detail on the plan: it is too confusing for those who don't read plans daily. The floorplan should note the building name, address, suite number, leasing contact name and telephone number, and rentable square footage (a usable square footage number begs tenants to concentrate on the amount of rent they're paying versus the space they're actually using).
Other useful pieces include a local amenity list (e.g., restaurants, banks, post office), a transportation information sheet, and child-care information. Place these marketing pieces into a neat folder with the name of the building and your company on the outside, or at a minimum, in a color that coordinates with the building. Many companies have virtual marketing tools these days. Prospective tenants can visit websites from Lincoln Properties, Gerald D. Hines, or a multitude of other property owners. Printed literature should reference websites and e-mail addresses.
Follow up tours promptly. Call the broker to get feedback. Discuss positive responses as well as any concerns. If you promised the tenant something, such as sending another floorplan, do it immediately. Write a note of thanks for the tour to both broker and tenant (an informal card is fine). Ideally, you should include some additional information based upon your tour discussion. Again, you are distinguishing your building (and its service and value) from the pack.
After some experience, managers develop a gut sense of what constitutes an excellent tour. Equity's Miller knows her property is a lease contender when "the prospect starts picturing themselves in the space." With a little homework, you too will be on a successful venture down the leasing corridor.
Five Key Questions for a Prospective Tenant:
Who is the decision maker?
Where does the decision maker live? (Based on the premise that a decision maker will not choose a long commute.)
What is the business and who will be housed at this location? (Gives you information on the suite layout so you can minimize tenant improvement costs.)
Where do they have offices now and why are they leaving? (Is there a compelling reason to leave their existing building or is the tenant simply shopping the market?)
How does their leasing process work? (By committee, negotiated via a main office?)
This article originally appeared in the Journal of Property Management.