What's Your Green Policy?

The green movement has become much more than a cause trumpeted by an ex-vice president and a few fringe celebrities with money and a microphone. It's become an industry. As a result, it's easy to approach this immense initiative with some skepticism. However, there is no denying that being green has become vital to many businesses and in fact, can be quite easy-if it starts with the right people.

Quietly, some of the world's largest companies have implemented far-reaching green policies that may very well represent the future of corporate energy use. While companies like General Motors, Intel and REI have drastically different business plans, their green policies are in lockstep with what it's going to take to reduce global carbon emissions.

In its Rancho Cucamonga facility, GM has installed the United States' largest solar panel system. The sun-soaking array provides half of the electricity needed to operate the facility and sends the rest back to the community. REI's new Pennsylvania distribution hub will become the country's largest such facility to obtain LEED certification. The surrounding land also includes 12 acres dedicated to the creation of a natural wetland and storm water runoff collection. Intel's Chandler, Arizona campus focuses heavily on water recycling. The company's goal is to re-use 75% of the water used during manufacturing. Their efforts include the internal reuse of 530 million gallons within the plant. Intel executives now consider energy conservation a major component of future business strategies.

The reason these companies have reached this level of environmental stewardship is because it became an executive priority. The effort needs to start at the top and become doable through small milestones and individual department goals.

Considering the savings through energy reduction, tax credits and additional federal and state incentives, cutting your company's carbon footprint can be as equally beneficial to its ROI as it can be to the environment, making the term "green policy" even easier to understand.

Fire Your Broker. Keep Your Friend

It's just business.

Nevertheless, many of us continue to build it on a foundation of friendships. And even though the accommodating party usually knows full well that the deal isn't on firm ground, on they tread, expanding, building ever higher, ignoring the ever-growing presence of creaks and weak spots, until…

The real estate industry is rife with shaky relationships just like the one described above. Mainly, it can be attributed to a lack of understanding of just how critical real estate decisions can be to a business. A license and a gold frame do not a good agent make. And in most cases, neither does a brother-in-law.

Clearly, not every business relationship forged by family or friendship is a destructive one. As long as the vendor involved was given the same RFP and made an equal to all others competing for the business, then the decision was fair and based on what's best for business. Real estate transactions, especially the negotiation of a mission-critical office lease, should never be left in the hands of a professional without significant tenure, regardless of how the relationship came to be. Too much hangs in the balance.

Remember too, that a good broker doesn't go away. There are "deal guys" and then there are professional tenant representatives: trusted, ever-present real estate experts hired to blend business goals with real estate needs. Well after the lease is signed, you should be able to seek assistance with landlord performance issues, reviewing operating expense pass-throughs and providing budget forecasts for future rents.

The bottom line is this: if you can't feel the presence of your broker in your office space every day, maybe it's time to reconsider the relationship, even if it will make the holiday gift exchange that much more uncomfortable.

Technology Can Support, But Shouldn't Replace, Tenant Rep Services

With the ubiquity of mobile devices that can receive e-mail, wireless networks being installed along city streets and open laptops sliding around on passenger seats, business leaders today expect answers, and results, quicker than ever. Lease negotiations, for example, can require months of planning but be finalized by a last minute decision that demands your tenant representative be able to process options quickly. Today's technology can help them do that.

For example, a product like LseMod (Lease Modeling) installed on a laptop could provide the rocket-fast analysis needed to get you into your new space. The tenant rep version of this product allows for quick cash-flow analysis of several space options at one time, allowing them to add dynamic factual data to the strategic plan already established.

A tool especially useful to those tenant professionals who provide you with services across a portfolio of properties, ProCalc enables the customization and retrieval of even the most granular data from all active leases. This gives your real estate professional a tremendous upper hand when decisions on multiple properties need to be made within a small timeframe. With the e-mail alert functionality, critical data can be distributed automatically, preventing the need to manually track when expirations are pending, clauses kick-in or options expire.

Two systems battling it out on the space search front are CoStar and LoopNet. Both web-based databases are essentially the commercial real estate sector's answer to the residential milieu's multiple listing service. Populated by listing agents and landlords, both systems have become immensely popular with tenant representatives because they provide easy to understand breakdowns of available space in a particular submarket. Keep in mind, however, that true real-time availability is difficult to track and that a tenant representative's first-hand market knowledge will in most cases be more reliable than what could be found online. In the end, CoStar and LoopNet, while well-designed and strong support tools, should be considered for only initial breakdowns of a market's occupancy options.

The commercial real estate industry in general has been slow to adopt new technologies. Tenant representatives, however, have pushed adoption because of their need to satisfy a diverse range of fast-growing clients. Clearly though, there needs to be a balance between how the speed of technology impacts a real estate transaction and the time it takes to provide the right answer. Tenant representatives who can strike this balance are primed to offer the best possible service to their clients.

Year-End Operating Expense Reconciliation Statements

Now's the time of year that most institutional landlords send out their year-end operating expense reconciliation statements.

• Have you reviewed yours yet?

• Are you certain you paying no more than you owe?

• Are you confident that your Landlord is charging you in accordance with your lease agreement?

• Did you know that most leases limit the time a tenant has to review and reconcile billing discrepancies?

• Did you know that failure to exercise "time sensitive" audit rights may cost you significant dollars in lost profits?

If you answered "no" to any of the above questions, you may be paying more than your fair share of your building's operating expenses! Call us at 770-390-1891. We would be happy to discuss potential savings available to you.