New York Times
January 1, 2013
By C.J. Hughes
In terms of marketing tone, the commercial real estate industry has long played the quiet cousin to the brasher residential business. While apartments are routinely sold using splashy, multifaceted ad campaigns, commercial brokers and developers have favored lower-key, brochure-based approaches.
But the two branches of the family may be growing closer. In recent months, the marketing teams for some New York office buildings have decided to get the word out by deploying the type of stylish Web sites once used only by luxury condominiums.
Unlike the Web sites of office buildings past, which tended to be bare-bones and buried deep within a landlord’s corporate home page, this new crop stands alone and crackles with animation, exuberant language and videos.
And by publicizing details like where telecom cables enter the building, these sites add transparency to a business that can seem clubby and secretive.
“Lunches with brokers is an old-school way of getting your message out,” said Grant Greenspan, a broker and principal at the Kaufman Organization, a landlord that has set up Web sites for two of its buildings, 100-104 Fifth Avenue and 550 Seventh Avenue. But, he added, “it’s only as good as the group of brokers who you perceive to have the clients.”
By introducing buildings to the public online to generate demand, Mr. Greenspan said, “you get clients going to their brokers and saying, ‘Why aren’t you showing me this building?’ ”
The site for 100-104 Fifth Avenue, a pair of joined, early-20th-century buildings near Union Square that Kaufman co-owns with Invesco Real Estate, was also useful in chronicling the $15 million renovation that occurred after the development team bought the property out of bankruptcy in 2010 for $94 million.
The renovation, which took two years, included adding a fire safety system and six elevators and redesigning a pair of lobbies. All of this is described in a colorful, animated timeline on the Web site, 100-104fifth.com, as are the specifics about those telecom cables.
The Kaufman Organization credited the site with helping to fill the 270,000-square-foot building quickly. It is at 98 percent occupancy today, up from 60 percent when the landlord bought it.
According to Mr. Greenspan, all six tenants signed there since 2010 said the site had played a major role in piquing their interest. Those tenants include Yelp, the online review business; Apple’s iAd, an advertising network; and Net-a-Porter, a women’s apparel retailer. They pay rents ranging from $45 to $60 per square foot, Kaufman said.
Similarly, at 550 Seventh Avenue, which Kaufman recently began managing for Adler Group, a new Web site is being used to rebrand the 12-story building in the garment district, where fashion tenants have historically held sway.
The Web site, 550seventhave.com, may surprise property owners who tend to be tight-lipped about their tenants. It shows the directory in the building’s lobby, revealing that Lilly Pulitzer, Donna Karan International and Oscar de la Renta have offices inside.
The site, introduced in October, is already paying off. An 11,000-square-foot space on the 10th floor is expected to be leased this month to a software company, Mr. Greenspan said, adding that the $30,000 cost of making both sites, plus the hours logged by a full-time worker, had been worth every penny.
If Web sites “facilitate renting the spaces 60 or 90 days sooner, they make all the sense in the world,” he said.
Some major New York landlords, like the Chetrit Group, have no online presence. And even when Web sites do exist, they can be a bit stolid, offering little more than the year the building was completed, its architect and its total square footage, as with the General Motors Building, owned by Boston Properties. Brokers say that when a high-rise has existed for years and is one of Manhattan’s prized addresses as well, it may not have to promote itself online.
A new office building must do more, especially when it hasn’t even come out of the ground yet. In those cases, a Web site is essential to allow tenants to visualize their future home, said Christopher V. Albanese, president of the Albanese Organization, a Long Island-based developer. These sites tend to be extremely eye-catching and could easily be mistaken for ones intended to sell multimillion-dollar condos.
In November, the Albanese Organization unveiled 510w22.com, for 510 West 22nd Street, a planned 170,000-square-foot office building in West Chelsea. The centerpiece of the artful Web site is a four-minute video narrated by the architect Rick Cook, which brims with dramatic music and soaring shots of the adjacent High Line.
Creating such a Hollywood-caliber product, which includes renderings that normally would not have been commissioned, doubled the building’s marketing budget — “but without it, tenants might think that this was just some ordinary building, and it really isn’t,” Mr. Albanese said.
Also, financing for the $150 million project cannot be secured until the building is 30 percent leased, he said, making a dynamic marketing tool all the more important.
Though online videos for commercial real estate are not widespread, they are gaining in popularity.
The Web site for 7 Bryant Park, a 28-story office building that Hines is developing on Avenue of the Americas, features a two-minute video. A piano tinkles; the camera swoops.
The site, 7bryantpark.com, introduced last winter, has not led to leases yet, but George C. Lancaster, Hines’s senior vice president of communications, said to expect similar branding for future projects. Web sites are “the first place anybody goes these days to shop for clothes or office space,” he said.
Brian Lindvall, a partner at Dbox, which made Hines’s video and the Web site for 510 West 22nd Street, agreed. Commercial assignments are coming in more frequently, he said, including one for the International Gem Tower, an Extell Development Company project at 50 West 47th Street.
Multimedia Web sites “have kind of been a residential tactic for a while,” said Mr. Lindvall, who has worked on apartment projects for Rudin Management and Forest City Ratner. “I think that relaying square footage and location is not enough to convey what a building represents.”
Like sites for condos, commercial real estate sites can seem to hawk lifestyles rather than places to put sofas or desks.
For example, businesses are urged to lease space at 837 Washington Street, under construction in the meatpacking district, because of its proximity to the new Whitney Museum and an Apple store — and, 837washington.com says, “because when fashion arrived, restaurateurs and hoteliers followed.”
The six-story, 55,000-square-foot, $100 million project is expected to be completed in 2014. Asking rents for the offices are $100 per square foot, said Paul E. Pariser, co-chief executive of Taconic Investment Partners, which is developing the building with Thor Equities.
According to Mr. Pariser, who sold 111 Eighth Avenue to Google in 2010, the tech companies that will most likely rent the space care about the hipness of their neighborhood. “They don’t want some stuffy image that says, ‘I have a Madison Avenue address,’ ” he said.
If Web sites help landlords leapfrog brokers to some degree by taking their message to the masses, the brokers don’t seem overly concerned.
Bruce Mosler, co-chairman of the brokerage firm Cushman & Wakefield, said he was glad technology had advanced enough to portray large offices compellingly online. He added that condos were ahead of the game only because apartments are simpler to depict.
Besides, brokers still need to be at the negotiating table when a lease is signed. “It will allow the product to get to the market more quickly,” Mr. Mosler said. “This town recognizes the value of what brokerages and brokers can provide.”