CHALLENGE: The primary challenge for this space relocation was mostly driven by economics. Office rental rates in the suburban Washington state submarket where the company leased space for their writers had appreciate greatly in the five years since their last lease renewal and they were experiencing sticker shock from the rental rates then prevailing in the market...
RESULTS: After performing multiple Market Availability Studies in the months leading up to their lease expiration date, we recommended to Corporate that they allow the lease for their current space to expire and not relocate to new space. The results were very happy employees and a total cost savings to the company of about $300,000.
“Corporate was surprised that we would make such a proposal since it meant no commission would be generated for us, and sincerely appreciated our honest, unbiased recommendation. The result was very happy employees and a total cost savings to the company of about $300,000.”
Multimedia Company, a magazine and logistics company was a portfolio account we represented. In addition to the corporate real estate locations, we also supported the locations for each of their publications. One of which, Kayak magazine based in Washington state, needed relocation space due to an issue with their space. In performing the needs assessment with the only two employees occupying the space, two writers for the magazine, we learned of their space and budget parameters, preferred geographic location and love of being on the water, canoeing and kayaking. After conducting the Market Availability Study we realized that it was going to be tricky locating space where they wanted it, near the water, at rates that would fit within their budget. It became clear after entering into negotiations with three competitive locations, that the bridge would likely be too far to span economically. Our recommendation: permanently close the office, let the employees work from home, save $65,000 per year and have two very happy writers with plenty of time to test drive new canoes and kayaks. Our surprising recommendation went over very well at Corporate. Sometimes the right deal for a client is no deal at all.
*Names of the company have been changed to protect client confidentiality. Representative photos used.