For most organizations, real estate is usually a huge expense, second only to personnel as a share of total expenditures. Finding ways to maximize this cost is even more critical for smaller organizations who often operate with fewer resources and under greater constraints than larger ones.
Technology start-ups, boutique-to-mid-sized law firms, retail, and particularly in the D.C. market, non-profits and associations, have to make adjustments according to a variety of shifting factors. And their needs for space may also change frequently.
These smaller organizations may worry about being overlooked, or placed behind bigger clients on the priority list. But that is not the reality. Full-service Commercial Real Estate (CRE) firms like Cushman & Wakefield recognize the benefits in working with small organizations and have the expertise these clients require. Furthermore, the bulk of our business in Washington D.C. involves advising clients who occupy smaller spaces. These numbers may be surprising, but per District-wide data we’ve gathered, just under half of the total tenant transactions in 2014 and 2015 were for less than 10,000 square feet. In fact, most of the clients’ office space requirements are for smaller rather than larger footprints.
Nearly half of our clients between 2014 and the first half of 2016 had a requirement for 5,000 square feet or less, and about 73% of them have a requirement for 10,000 square feet or less. That means only about a quarter of the deals we advise on is for those seeking 10,000 square feet of office space or more.
Additionally, when looking at the numbers for all of DC, 49% of total tenant deals were less than 10,000 square feet. In other words, smaller deals are a larger percentage of our business than the total amount of small deals district-wide.
Furthermore, we typically help more clients who need very small spaces, 1,000 square feet or less, as opposed to clients who need very large spaces, as in 100,000 square feet or more. So those small clients receive our full attention.
That means we must be able to tailor services to each unique circumstance in order to ensure the needs of our core client base are met.
As a result, our Tenant Representation experts act more as consultants rather than brokers for small firms, helping them align strategic business, financial, and operational objectives with real estate requirements.
Our experts’ in-depth knowledge of the market, other tenants’ experiences, and property owners’ perspectives, provide small tenants with a more complete picture of their available options. We track trends and forecast economic developments, thus equipping our brokers with current analyses on the latest market conditions. In turn, our clients gain an understanding of what tenants should expect from landlords and are able to make strategic decisions.
When dealing with such an essential and significant expense, like real estate, measurable results are critical for ourselves and for our clients. As a firm with enough expertise to skillfully run multiple service lines, we give smaller clients access to the same sort of tools and institutional knowledge available to larger organizations. These tools include things like Lease Administration, Risk Management Services, Sustainability Services, and a host of others. We strive to put these tools to use for all of our clients, regardless of size.
Lease Administration, which encompasses everything from technology consulting, implementation, ongoing management, to lease audit services, enables clients to control leasehold expenditures through management of critical dates and options. It also helps clients increase efficiency through effective space utilization, and develop strategic plans that align with their business by providing access to detailed real estate data.
Another set of tools available to smaller clients through work with us is Workplace Strategies, which allows small tenants to use their limited space most effectively and use their workplace to attract and retain top talent. This can mean anything from creating more collaborative and open spaces to managing a hoteling or external work policy to cultivating office amenities that become selling points for potential employees.
We also offer commercially focused sustainability advice that can inform a client’s real estate strategy. This advice reduces cost, maximizes value, and supports delivery of a sustainability agenda for smaller organizations the same way they do for bigger ones.
For Cushman & Wakefield, the payoff of working with small clients isn’t just the business, but also the opportunity to gain insight about everything from market trends to workplace strategies. These insights help them better serve their clients and grow their knowledge base in the process. For small firms, the benefit of partnering with a large full-service practice is more than just finding office space at a good price, they also gain a valuable resource to look to for all of their real estate needs.