the news magazine for the professional asset · pdf filethe news magazine for the cbc...

Coldwell Banker Commercial®

The news magazine for The CBC professional

Asset Repositioning AnalysisMaximize asset value through a simple evaluation

executive Q&AA conversation with Tim Dimond, the Coldwell Banker Commercial Vice President of Ownership Services

CBC MarketwatchCBC professionals discuss what’s happening in their markets

PLUS: Local Office ProfileMeet the Glendale, CA CBC affiliate

also in this issue

the2008

PReMieRe

issue

03WINTER/SPRING 2008 The Insider

>> CBC Monitor What’shappeningat Coldwell Banker Commercial®

NATIoNAl ACTIvITIesThe cornerstone activity occurred in June when Rick Davidson led

a mountaineering team of CBC professionals to the summit of

Mt. Hood (OR) and Mt. Adams (WA). Not only was this event a

great team-building experience, but over $35,000 was raised!

loCAl ACTIvITIesNumerous affiliates have embraced BBBS; here’s a sampling

of recent successes:

• Coldwell Banker Commercial Benchmark

Jacksonville, FL: participating in an “Adopt-a-School”

program by visiting a local school weekly to help mentor

deserving children.

• Larry Singer, Coldwell Banker Commercial ETN

Las Vegas, NV: sponsored a table at the annual gala dinner

held at the Wynn Hotel & Resort.

• Tee Scott, Coldwell Banker Commercial Lazar & Associates

Redlands, CA: participated in BBBS walk-a-thon event.

geTTINg INvolvedThere are many ways to get involved with BBBS, including

becoming a mentor, participating in the annual BBBS Bowl-A-Thon,

offering your professional services pro-bono, and more. To help

you and your office get started, the CBC organization has created

a participation guide (found on Blueprint) that will guide you

through the many ways you can get involved with your local

BBBS agency.

GroWinGBiGwithBigBrothersandBigSistersIn 2007 Big Brothers Big Sisters (BBBS) was announced as the national charitable

partner for the CBC organization. And since then, there have been many exciting

activities surrounding this relationship. Initiated as a way to support the philanthropic

efforts of the Coldwell Banker Commercial organization, the BBBS alignment seemed

like a perfect fit from the start, as both organizations have a long history of success

and both work to provide mentorship and guidance.

PResIdeNT’s NoTeWelcome to the inaugural issue of

The Insider, the news magazine for the Coldwell Banker Commercial ®

affiliates organization.

We’ve created The Insider as a sophisticated, professional-grade publication that every

Coldwell Banker Commercial professional can be proud of. Our objective is to provide

you with an informational tool that is both educational and entertaining.

Each issue will focus on a variety of information, everything from corporate tools

and resources, to practical advice on commercial real estate, to interesting articles

about some of the folks that comprise the CBC organization. In fact, we’ve got some

great profiles in store for our kick-off issue, including a piece on Coldwell Banker

Commercial North County in Glendale, CA and an executive Q&A with Tim Dimond,

our VP of Ownership Services.

As you can see, this is more than just a standard company newsletter — we’ve tried

to emulate the look and feel of a true magazine. We are planning two issues for 2008,

with the second one to be finalized in the latter part of the year. Please let us know

what you think! We encourage you to read through the issue and offer comments and

even future story ideas. Remember, this publication is designed specifically for you,

the Coldwell Banker Commercial professional; as such, we want to make this as useful

a tool as we can.

Along with the recent introduction of our new technology platform that includes

our company intranet, Blueprint, and website, cbcworldwide.com, the creation and

distribution of The Insider represents the beginning of an ambitious new

communications effort about which I am personally very enthusiastic. This is an

exciting time for the Coldwell Banker Commercial organization, and we hope you

share in that excitement. We look forward to continuing to provide you with valuable

tools and to discovering new and exciting ways of effectively communicating with

our network. Enjoy!

RICk dAvIdsoN President and COO

CoNTeNTs

02 President’s Note

03 CBC Monitor

08 CBC Marketwatch

12 CBC Office Profile

14 Commercial Matters: Asset Repositioning Analysis

18 Innovations

20 CBC Executive Interview

23 CBC Resources Spotlight

edIToRIAl sTAff

editor-In-Chief Tom Nolan

staff Writers Jason Silfies, Rick Davidson, Tim Dimond, David Birnbaum, Fred Schmidt

layout and design BCS, Inc.

Printing National Real Estate Investor

Questions or comments about The Insider may be sent to: [email protected]

The Coldwell Banker Commercial Climb For Kids’ Sake team

unfurls the event flag atop Mount Hood.

© 2008 Coldwell Banker Real Estate LLC. Coldwell Banker Commercial® is a registered trademark licensed to Coldwell Banker Real Estate LLC. An Equal Opportunity Company. Each Office is Independently Owned and Operated.

each issue will focus on a variety of information, everything from corporate tools and resources, to practical advice on commercial real estate, to interesting articles about some of the folks that comprise the CBC organization.


04 The Insider WINTER/SPRING 2008 05WINTER/SPRING 2008 The Insider

In 2007, the Coldwell Banker Commercial

organization completed its successful series of

regional networking events held in a variety of

markets across the country, such as San Francisco,

Dallas, Chicago and Baltimore.

The meetings are designed as an opportunity for CBC

professionals within a specific region to network with each

other and learn about developments within the brand and

the industry. Hundreds of CBC professionals attended various

2007 events and the positive feedback we have received

from attendees underscores the success of the program. The

CBC organization is delighted to report that the program will

continue in 2008 with a new agenda and more opportunities

for our professionals to collaborate.

The 2008 Regional Networking Meeting schedule includes

planned stops in Chicago, St. Louis, Orlando, San Diego, Salt

Lake City, Washington D.C., Raleigh, N.C. and New York City.

Stay tuned for further details, including specific dates for

each meeting.

AsSeenin...The CBC® organization will target clients and the industry alike with a comprehensive advertising plan for 2008 comprised of print and

online ads as well as industry sponsorships. The national print and online campaign will be featured in business publications and websites

such as The Wall Street Journal and trade journals like National Real Estate Investor and Real Estate Forum. Industry co-sponsorships include

select RealShare conferences across the country, the ICSC spring convention, the annual conference for CCIM, Corenet and many more.

successful Regional Networking Meeting Program Continues in 2008

During the past twelve months, a highly successful public

relations campaign has brought the Coldwell Banker

Commercial organization much recognition in commercial

real estate and general business media outlets, and has

highlighted the CBC organization’s knowledge and

expertise on commercial real estate trends.

The PoWeR of The PeN (ANd Tv ANd RAdIo. . .)

In 2007 alone, the CBC organization boasted over 345 million

favorable media impressions through placements in national

commercial trade magazines, business outlets and regional

media channels. Corporate and affiliate features, quotes, and

transactional coverage appeared in numerous outlets, including

Commercial Property News, GlobeSt, Retail Traffic and National

Real Estate Investor as well as regional publications across the

Continued on page 22

The Coldwell Banker Commercial organization

continues to remain an industry leader among

commercial real estate service providers.

These most recent survey results detail the CBC

organization’s leadership position in brand

awareness among corporate occupants and

commercial real estate developers.

Ahead of the Pack

(National Real Estate Investor conducted the survey on behalf of the Coldwell Banker Commercial organization. The survey targeted commercial real estate developers, owners, managers and corporate users from November 29, 2007 through December 17. 2007. A total of 273 respondents answered the survey. Sampling error of +- 5.9% at a 95% confidence level.)

CBC grubb & ellis

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2008 Media PlanThe wall street Journalnational real estate investor (survey report)national real estate investor (Brand ad)real estate forumretail Traffic (survey report)retail Trafficshopping Centers TodayiCsC spring Convention programshopping Centers Businessheartland real estate Businesssoutheast real estate Businessnortheast real estate Businesswestern real estate Businessrealshare conference guide

globest.comnreionline.com (ad roll over)nreionline.com (survey report)nreionline.com (enewsletter)retailtrafficmag.com (survey report)retailtrafficmag.com (enewsletter)reBusinessonline.com

realshare ConferenceiCsC spring ConventionCCimCorenet globalsp

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Jan feB marCh april maY JUne JUlY aUg sepT oCT noV DeC30 7 14 21 28 4 11 18 25 3 10 17 24 31 7 14 21 28 5 12 19 26 2 9 16 23 30 7 14 21 28 4 11 18 25 1 8 15 22 29 6 13 20 27 3 10 11 24 1 8 15 22week of



Under the leadership of Fred Schmidt (Senior Vice President,

Global Client Solutions and 25-year commercial real estate

practitioner), the Coldwell Banker Commercial organization

recently announced the establishment of a new, Global Client

Solutions Team. The group’s primary goal will be to generate new

business opportunities for CBC professionals. In fact, with the

launch of this new group, the current business development team

will see its ranks double.

As part of the expansion, veteran commercial professional Bill

Hinson will serve as Vice President of Business Development and

head up an experienced team of Regional Business Development

Directors that include Jeff Maher (covering the Northeast and

Midwest regions) and James Robinson (covering the Southeast

region.) Through this team, the Coldwell Banker Commercial

organization will have amassed almost 100 years of collective

commercial real estate experience.

“We aspire to proactively generate new business for our

professionals — and we have a team in place with a proven track

record to help make that happen,” notes Schmidt. “We intend to

aggressively pursue new customer relationships for the CBC

organization as well as identify and leverage the cross-selling

opportunities that exist through our parent company, Realogy.

Plus, our strategic approach to prospecting will help increase our

chances of capturing qualified leads and reaching the right

decision makers.” The GCS team will focus its efforts on a number

of core areas:

• An aggressive new business outreach program designed

to significantly increase referrals and prospects for

CBC professionals.

• Offering improved proposal and presentation templates—

such as the successful placemat template — for various

property sectors, including office, industrial, retail, land,

multi-family, and hospitality on both Tenant and Owner

Representation assignments.

• Leveraging the business-to-business relationships that

currently exist within Realogy, as well as network internally

within the company to develop relationships that will aid in

winning new business.

In addition, the GCS team will help to administer and manage

product line and industry segment business development groups,

as well as attend high-visibility commercial trade shows and

industry events. For more information, contact Fred Schmidt at

[email protected].

BusINess develoPMeNT uPdATeDriving Transactions Through The Global Client Solutions Team

“Weaspiretoproactivelygeneratenewbusinessforourprofessionals–andwehaveateaminplacewithaproventrackrecordtohelpmakethathappen.”

—FRED SChMIDT, Senior Vice President, Global Client Services

ProducingthenextGenerationofCBCSuperstarsEmerging Broker Training

The Coldwell Banker Commercial® organization’s

successful Emerging Broker Training Program — one of

the most comprehensive new broker training programs in

the industry — will continue its successful run in 2008.

Targeted towards professionals with one year or less experience

in commercial sales/leasing, this four-month program of blended

training has already helped over 180 CBC professionals learn the

fine points of becoming a commercial real estate broker.

Jessica Murks, an EBT grad with Coldwell Banker Commercial

Alfonso Realty in Gulfport, MS notes how the training she received

from the program helped in her first major closing, a $16.8 million

multi-family deal in 2007. “I encountered problems during the

inspections in which the buyer wanted to lower the purchase

price,” said Jessica. “Thanks to the negotiation skills I learned

through EBT, I resolved this issue and many others. I really

enjoyed the program and learned skills that I will take with me

throughout my career.”

According to David Birnbaum, Senior Director of Learning at the

Coldwell Banker Commercial organization, the program owes its

success to its unique structure. “Most companies have a one or

two-week boot camp, with new hires acting as ‘runners’. We stage

the learning over four months using classroom, Webex and self-

paced readings and web courses,” Birnbaum notes.

“Many critical skills associated with real-world field assignments

are actually graded during EBT. As an example, for prospecting,

students are required to hand in their prioritized prospect lists.

In addition, a custom ‘Online Scorecard’ allows the instructors,

office mentors and students to track progress on both test scores

and as well as in actual professional application.”

The next EBT class begins in February, in Orlando,

FL and concludes in New Jersey in late June. For

more information on EBT or any other Coldwell

Banker Commercial University learning programs,

please visit the Learning tab on the Blueprint

homepage (cbcblueprint.com), or contact David

Birnbaum at [email protected].

IN 2008, A MIGRATION OF APPROxIMATELy 6,000 RESIDENTS PER MONTh IS ExPECTED, DUE TO ThE CONTINUED ExPANSION OF ThE RESORT CORRIDOR IN LAS VEGAS.


CBC MarketwatchTrendsintheregionalMarkets

Are there any property sectors in las vegas that are expected to either continue to do well or even improve in 2008?Retail is still very strong; but with housing market issues,

we expect some retail to be affected.

The office market is experiencing higher vacancy rates due

to the downsizing of companies that are related to the residential

market, and the delivery of 6 million square feet of office space.

With 13% vacancy equaling 8 million square feet and a net

absorption of approximately 1.9 million square feet annually,

the Las Vegas market is left with a 4-year supply.

Land prices in Las Vegas have become too expensive in most

areas to develop industrial. New buildings coming on line are with

developers that have been banking land for sometime.

What is your office doing to position itself to take advantage of the current local market conditions?Because the market has softened, Coldwell Banker Commercial

ETN is positioning itself to target properties with high vacancies

and targeting tenants to take advantage of concessions while the

market is soft. Additionally, investors are now paying more

attention to fundamentals, and sellers are becoming more

realistic as the capital markets have tightened.

Tomnaseef,CCiM,SiorPresident, Coldwell Banker Commercial ETN, Las Vegas

What’s the expected market environment for las vegas in 2008?The expectation is that the market

should continue to be steady in Las

Vegas. A migration of approximately

6,000 residents per month is expected, due to the continued

expansion of the resort corridor, with more than 3,000 new

timeshare rooms and more than 46,000 new hotel/motel rooms

coming on line over the next four years.

The CBC Insider polled several offices across the country for a snapshot of their local

commercial real estate environments for 2008. here’s what each had to say about

what’s happening in their regions.

LookingAhead

AlanScott,CCiMPresident, Coldwell Banker Commercial Almar Real Estate Group, Carlsbad, California

What’s the expected market environment for Carlsbad and surrounding areas for 2008?After many years of a very limited

land supply in Carlsbad and North

San Diego County, we have recently seen a number of larger,

mixed-use projects all hit the market at the same time. That has

created an over-supply of the smaller, for-sale office and industrial

owner-occupied product, including free-standing buildings and

condominium units. It is estimated that the Carlsbad office market

is currently running a 20% vacancy factor and has an excess of a

two-year supply of for-sale office product.

Are there any property sectors in Carlsbad and the surrounding areas that are expected to either continue to do well or even improve in 2008?Occupancies of all product types of existing inventory are stable

and averaging less than an 8% vacancy factor. The strongest

occupancies are in the multi-family sector, with vacancies

averaging below 3% and strong upward pressure on rents.

What is your office doing to position itself to take advantage of the current local market conditions?We feel our clients and their projects are particularly well-

positioned to compete in a changing and uncertain market

because of their quality locations, design and construction,

as well as offering a wide range of building and suite sizes at very

“ourstrongmixofexperiencedseniorbrokersandyoungerassociateshelpstoensurethatourclientsandtheirprojectsaregettingthebestpossibleresults.”

—ALAN SCOTT

competitive price points. Coldwell Banker Commercial Real Estate

Almar Group is keeping a very focused marketing approach, while

re-doubling our efforts and outreach with the required resources.

Our strong mix of experienced senior brokers and younger

associates help to ensure that our clients and their projects are

getting the best possible results.

Anything else of importance to note about your market?Carlsbad and the entire San Diego North County remains one of

the most viable and competitive commercial real estate markets

in Southern California. Compared to Orange County or Central

San Diego County, potential tenants and buyers have many

options available today and represent good value. Living and

doing business in Carlsbad and San Diego North County offers a

very high quality of life, and its excellent, highly-skilled work force

clearly differentiates it from other markets in Southern California.

Quarterly

2Q 2007

4.3%

4.8%

5.8%

06/30/07

3Q 2007

4.0%

4.7%

5.6%

09/30/07

YTD Avg

4.2%

4.8%

5.8%

09/30/07

san Diego

west

United states

average over period ending

Multi-Family Vacancy Rate Comparison*

*REIS San Diego MetroTrend Futures Report — 3Q 2007


CBC MarketwatchTrendsintheregionalMarkets

Our West Volusia County market is poised for continued growth

of small-scale commercial projects. This demand is in response

to the current deficit of services needed to satisfy the large

residential base. West Volusia serves as a bedroom community

with the majority of residents commuting to the Orlando area

for employment.

Are there any property sectors in orange City and the surrounding areas that are expected to either continue to do well or even improve in 2008?We see the multi-family market and the local retail section doing

well through 2008. Our area has very limited amount of

affordable apartments due to a lack of available sites with proper

zoning. The massive growth was focused on single family

properties over the past years.

The retail side still remains underserved in our market place based

on the number of residents located in our trade area versus the

overall supply of retail space. The gap continues to widen as new

retail space has not kept pace with the increasing population.

Several large scale projects have been proposed to help narrow

the gap.

We expect growth in office space for the surrounding area, which

includes Orlando. We see an opportunity for corporate relocation

due to the low tax rate for corporations.

What is your office doing to position itself to take advantage of the current local market conditions?Coldwell Banker Commercial AI group is partnering up with a local

builder to develop economical retail space for sale and or lease.

The small business owners of our community need an alternative

to the high-priced lease space currently available. We continue to

work with owner occupants, providing them with a start-to-finish

service that enables them to build and own their building as

painlessly as possible. On the multi-family side, we are working

with the local government to develop affordable housing.

Anything else of importance to note about your market? As in all markets, the key is to consistently set yourself apart

from the rest as the “go-to” experts. By constantly reviewing

our market, and looking for new and emerging opportunities,

we make the most of what we call a “changing,” rather than

“slowing” market.

JohnWanamaker,CCiMColdwell Banker Commercial Al Group, Orange City, Florida

What’s the expected market environment for orange City, fl and surrounding areas for 2008?The West Volusia County Market

(Orange City, Deland, Deltona and

DeBary) is a direct submarket of Orlando and reflects that market

environment. We expect to be buffered from any major slow–

down because of the diversity of the central Florida job market.

Although residential construction helped fuel the area’s growth

in the past few years, the local economy is not solely dependent

on that factor. Commercial construction remains steady due to

long-term, large-scale projects such as schools, roads, and

medical facilities.

Strong growth continues in tourism and related industries with

salaries comparable to the construction industry. The area’s

technology industry is expected to exceed $10 billion and to

create many new high-paying jobs. The University of Central

Florida now has an enrollment of over 45,000 students and was

recently recognized as America’s number one partnership

university and was awarded the go-ahead for a medical school.

Are there any property sectors in Mankato, MN and the surrounding areas that are expected to either continue to do well or even improve in 2008?For the most part, warehouse and industrial sectors throughout

Mankato may be the brightest sector in 2008 primarily because

there is such a lack of inventory throughout. So, we may see

developers/investors begin to evaluate the opportunity to add

inventory to the market.

What is your office doing to position itself to take advantage of the current local market conditions?Coldwell Banker Commercial Fisher Group continues to position

itself in several different ways throughout the Mankato market.

There continues to be a smart growth development plan for those

areas of the community that are not developed, and there is

an even larger push for more redevelopment of distressed

areas of the community. We hope to capitalize on opportunities

within these areas as well as pursue other markets in our

expanded region.

DavidSchooffPresident, Coldwell Banker Commercial Fisher Group, Mankato, Minnesota

What’s the expected market environment for Mankato and surrounding areas for 2008?2008 will be an interesting year

with respect to the Greater

Mankato commercial real estate market. Coldwell Banker

Commercial Fisher Group is still poised for a solid year, but I do

not expect to see any major local projects unveiled due to the

lukewarm economy, coupled with a national election. Both of

these factors lead to uncertainty in real estate markets.

“Constantlyreviewingyourmarket,andlookingfornewandemergingopportunitiesmakesthemostofwhatwecalla‘changing,’ratherthana‘slowing’market.” —JOhN WANAMAkER

Aerial view of Mankato, MN

FOR ThE MOST PART, WAREhOUSE AND INDUSTRIAL SECTORS ThROUGhOUT MANkATO MAy BE ThE BRIGhTEST SECTOR IN 2008.


Ukropina, Barsamian and Issaians have plans for additional

growth. In Glendale and surrounding areas like Burbank, there is a

good deal of activity with mid-market and small businesses and in

the industrial and office sectors.

There are plans for Coldwell Banker Commercial North County

to add more retail expertise and capabilities and an office in

Pasadena. The partners want that expansion to be highly

strategic; they want to buy the building by 2009 to increase

equity in the business, but also want to find a suitable location

that can create synergies in clients’ buildings.

The partners understand that a mix of hard work, good luck and

solid support has brought them to this point, and they know it

is not an easy road ahead. “It’s tough to recruit top brokers,”

Ukropina added, “but I think we have an approach that really

separates us.” In fact, when you boil it down, the formula for their

success is simple: when you combine the extraordinary depth

and breadth of experience at Coldwell Banker Commercial North

County with an unwavering dedication to client servicing,

continued growth and success is inevitable.

The team had complimentary areas of expertise, not to mention a

facility, support, and the most recognized brand name in the

industry. They had knowledge of the local market and contacts

to generate transactions, so they were not starting completely

from scratch.

Vacancies were at an all-time low in the San Fernando Valley,

costs were high and fair market values difficult to determine.

When clients such as G&K Management, Sportfun Inc., Western

Studio Services and Advance Liquidators Inc. needed to lease, sell,

renew or relocate their industrial facilities, Coldwell Banker

Commercial North County saved them hundreds of thousands

of dollars.

In its first year in business, the office grossed nearly $3 million in

commissions. Today, the 4,300-square foot office space is now

bursting at the seems with 23 people and a sales staff of 15.

Ukropina adds, “a real key was that, with our facility, we were

taken seriously by clients from the beginning.” Ukropina also

credits the Coldwell Banker Commercial corporate staff as being

enormously helpful in the success of the office: “I didn’t think

there would be the level of corporate support that there was.”

CBC Office ProfileCaliforniaDreamin’

substantial start-up costs). It was a risky proposition that could

have easily limited initial profits. But the trio believed it was the

best way to entice top sales and staff talent to come aboard.

Ukropina, Barsamian and Issaians studied all the options. “We

looked at going out on our own and at other large national

companies,” Ukropina said. The competing firms centralized

profits and decision making. “We believed that, one, the Coldwell

Banker Commercial® name was superior and that we would get

more corporate support, and two, we wanted to own a franchise

and run our own business.”

The confidence they gained after meeting Coldwell Banker

Commercial president Rick Davidson and the corporate team in

Parsippany closed the deal. “It’s always scary to a leave a big

company after 22 years,” offered Ukropina.

In November of 2006, they moved into a 4,300-square foot office

with three sales people and one graphic designer, and Coldwell

Banker Commercial North County was born. The trio took on

significant expenses laying down a top infrastructure and had to

work out new roles as managers. They offered a share of net

profits with all employees and generous splits on commissions.

This was a distinctive platform. It also meant there was pressure

to generate revenue quickly.

All three were doing well. They had secure incomes and weren’t in

a situation that necessarily warranted taking risks; they could

avoid new administrative and managerial challenges. However, in

another 20 years there would still be no equity for their work, little

say in decision-making processes and no sense of the satisfaction

normally associated with having built a business. All three shared

a vision of how they could be doing more.

Their partnership was formed around fairly unique concepts in

commercial brokerage – employee profit-sharing and starting

their business in a state-of-the-art facility (which meant

ColdwellBankerCommercialnorthCountyGlendale,CaliforniaIn 2006, Bill Ukropina, Greg Barsamian and George Issaians got together in Glendale,

CA to discuss a potential partnership. The three knew each other through their work

at CB Richard Ellis, and together they had over 60 years experience in commercial

brokerage. Ukropina had 22 years under his belt specializing in office property; Issaians

had 26 years experience, including 11 years in asset management and 15 years in multi-

family and investment sales; and Barsamian had 20 years specializing in industrial.

(From left) Bill Ukropina, Greg Barsamian and George Issaians, the three partners of Coldwell Banker Commercial North County

The entire Coldwell Banker Commercial North County staff

oday’s current interest rates, market

expansions and economic redevelopment

initiatives targeted in many locals throughout

the country, coupled with improving or strong

absorption of class “A” properties, have created

an opportunity for an owner to capture

increased returns through asset repositioning.

Owners that might otherwise have had to settle for “as-is” have

the ability to capture improved returns from the market through

an asset. Conversely, there exists an opportunity for an astute

management company to recognize an asset’s position within

the marketplace and offer the owner the opportunity to enhance

their own position and improve the operating performance of

the property.

In both instances it will take effective communications, a strong

partnership, market knowledge and clear, well-defined objectives.

Asset repositioning represents the opportunity for the

management company to work with the owner and not just for

the owner. The team will need input from every member involved

in the property’s ownership, management, investment

advisement, leasing, asset management and research.

When repositioning an asset in the market, having a thorough

understanding of the owner’s goals and objectives for the

property is the foundation of the plan. Moreover, there are

several core components, both tangible and intangible, that need

to be considered and factored into the decision to reposition.

Some of these core components include, but are not limited to:

• Ownership objectives

• Geographic location

• Market perception

• Market rents

• Ownership – funding source

• Transportation infrastructure

• Amenity base

Many of these same components are part of a general

assessment and examination of a property. Common ownership

objectives run along the lines of an asset’s position within a

portfolio (where applicable) and include market value, value to the

owner as a stand-alone, value within the larger portfolio, hold

objectives, internal rates of return and opportunity costs, to

mention just a few. These considerations notwithstanding,

improving a property’s position either through increased net

AssetrepositioningAnalysis


Commercial MattersStrategiesforToday’sCommercialProfessional

Asset repositioning is a constant in the commercial real estate arena.

Creating new appeal for an existing property, or finding creative ways to

rekindle an underperforming asset is the most crucial component for

sustaining the life-cycle of a property and putting owners at ease. But

before any changes are initiated, a straightforward dissection of

objectives and due diligence will ensure that commercial professionals

make the right recommendations and achieve the most value for an asset.

Thefirststeptounlockingthemaximumvalueofproperties

T

operating income or market value will always be deemed a

positive improvement by any owner.

One of the first and most important steps in assessing a

property’s current and future potential position is a SWOT

(strengths, weaknesses, opportunities and threats) analysis.

This is a comprehensive survey of the building and of the outside

factors/trends affecting its position in the market. The team at the

property performs the analysis in order to identify the feasibility

of value enhancement options and the components making up

the repositioning plan.

Identify value enhancement opportunities The following factors should be considered when identifying value

enhancement opportunities:

• Market Location — The position of the asset is determined by its

location within its respective submarket as well as its

relationship to comparable properties.

• Market Perception — What do tenants and brokers in the

market think of the property? Is it seen as a prime business

location?

• Ownership/funding source — Is the owner aware of the

market and its requirements? Is the owner institutional,

public or individual, and how tenant/customer-oriented are

they? Is the property run equal to or better than

comparable properties?

• Infrastructure — Is the supporting structure adequate,

are the surrounding roads sufficient to support the

level of traffic? Is adequate water, sewer and drainage in

place? Is emergency egress sufficient?

• Amenities — Are the amenities basic (convenience/food, dry

cleaning, etc.) or geared more towards higher-end users,

(auditorium, conference center, meeting rooms, audiovisual

capabilities, high-speed cable, etc)?

Evaluate capital enhancements and overall financial benefitThis portion of the analysis is empirical in nature and should be

done on an ongoing basis.

• Income — What is the value of the current rent roll, what is

the current/projected lease roll-over exposure? Is the

current tenant credit base adequate or could it be increased

with new tenants? Does it account for the total occupancy of

the building, including allowances for vacancy projections?

Will the market allow roll-over rents to be increased without

exceeding the current market or will rents reduce due to

market drops and shifts? What are the market vs. actual

lease rates and are the lease rates below, equal to or

exceeding the current market rates? (The analysis should

factor all comparable factors based on the individual

submarket, free rent, tenant improvement allowances and

commissions.)

• Expenses — Are the base operating expenses in-line with

the market? Are real estate taxes based on the correct

assessments and are direct ownership expenses in-line with

the cost of operating expenses?

Assess and analyze overall market for product type Consider if the current market demand falls in-line with the

building type and operation.

• highest and best use — What is the property’s density? Is there

additional FAR (Floor Area Ratio) to be achieved, are there any

transferable development rights that can be attached and is the

property in a receiving zone to receive them? Are the use and

utilization appropriate to the facility? Are there conversion

options that would achieve a better and higher use?

16 The Insider WINTER/SPRING 2008

IdeNTIfY value enhancement opportunities based on a

building’s position

evAluATe capital enhancements and overall financial

benefit (increased lease rates, reduction in expense,

markets perception)

Assess and analyze overall market for specific product type

deTeRMINe short or long range investment goals

RelATIoNshIP to larger portfolio (overall return criteria)

The SWOT Analysis will involve the following components:

OperationsThe following operations components are key to the analysis:

• Deferred maintenance — Are any deferred maintenance

items present; are they expense related and can they be

recovered? Will they have any ability to result in increased

rents or are they capital in nature? Are there long-term

capital projects planned that will impact the property or its

efficiency of operations?

• Financial or functional obsolescence — Is the property fully

amortized? Is the value consistent with the remainder of the

owner’s portfolio, or functionally obsolete in terms of its

tenant base and the operation of the facility or the systems

within the building?

Determine short- and long-range investment goalsWhat is the type of owner and how do their investment goals

relate to their corporate structure? Is the purpose to maximize

the return in the shortest period? Is the owner an opportunity-

cost owner? Does he or she prefer long-term holds, and will the

hold period have greater value than the return? Does the owner

have set, specific and defined investment return criteria

requirements?


Commercial MattersStrategiesforToday’sCommercialProfessional

What is the relationship of the specific asset to the owner’s larger portfolio?Does it currently meet the larger portfolio objectives; will it meet

them if repositioned? Are investments made to achieve a

diversified and balanced portfolio? Or, if an asset no longer fits

the owner’s portfolio requirements, is it considered obsolete?

The SWOT Analysis will provide for the owner a specific,

formulated repositioning plan, to help capture current market

conditions, improve the property’s position, and add value that

might otherwise go unrealized. If planned and implemented

properly, the analysis should result in enhanced value returns

with potential for:

• Increased and improved ROI

• A more stable and credit-worthy tenant mix

• Reduced or stabilized expenses

• Improved market position

• Highest and best use

Taking the time to conduct a SWOT analysis is highly

recommended for asset repositioning. A team approach is critical

not only for a successful analysis, but to the overall effort. Input

from management, leasing, finance and investment advisory are

necessary to develop the most comprehensive summary and

recommendations for the property. Only an integrated approach

will result in the full benefits of asset repositioning for both the

owner and management company.

Information and analysis contributed by Rick Davidson and

Tim Dimond

Whenrepositioninganassetinthemarket,havingathoroughunderstandingoftheowner’sgoalsandobjectivesisthefoundationoftheplan.

19WINTER/SPRING 2008 The Insider18 The Insider WINTER/SPRING 2008

InnovationsTheFuture,Today

2008 represents the dawn of an exciting new era in technology at the CBC®

organization, as we launch a ground-breaking platform for our professionals. With the

introduction of our Intranet, Blueprint, and our new public website, cbcworldwide.com,

CBC professionals will have access to more cutting-edge resources than ever before.

LeadingtheWayinTechnology

Because CBC professionals

need to spend less time on

operations and routine

procedures and more time on the human interaction that will

ultimately lead to deals, we have developed a commercial only

intranet site called Blueprint.

some of blueprint’s key features include:Use as Individual Company Intranet

Each company is offered a free intranet site on Blueprint.

Administrators can upload documents that are relevant to their

company, such as forms, deal documents, templates or calendars.

Your intranet would be a central location to post news, events,

announcements, or other general company information.

Commercial University

Commercial University is an e-learning site that strives to have

a measurable impact on our business by providing cutting-edge

training and job aids to support CBC professionals. Commercial U

provides access to: EBT training, Mike Lipsey Seminars,

professional development, computer skills and a variety of

other learning modules and resources.

Dashboard

The Dashboard feature shows production numbers of how

professionals rank as individuals; within their office or company,

within their state, and within the CBC network. Administrators can

view entire office or company rosters. Production reports can

be downloaded.

ABouT CBCWoRldWIde.CoMcbcworldwide.com is the Coldwell Banker Commercial®

organization’s new public website, replacing

coldwellbankercommercial.com. With a sleek appearance that’s

simple to use, and interactive tools — such as sophisticated

mapping and aerial photography — cbcworldwide.com offers

superior resources for clients and CBC Professionals alike.

key features on cbcworldwide.com include:Enhanced Office and Professional Profile Pages

These pages include detailed information on individual CBC

offices and professionals, such as experience, services provided,

specialties, and notable transactions.

Advanced “Interactive” Property Search

The site offers a variety of property search options, including a

“mosaic” property view, which gives users a snapshot of multiple

properties at one time.

Search by Map

cbcworldwide.com users can browse properties through an

advanced mapping function. In many markets, properties can be

displayed in the “bird’s-eye” view, with the ability to see close-ups

of buildings.

My Network

My Network allows you to connect with other Coldwell

Banker Commercial affiliates using “Professional Networking”

technology, and is designed to foster collaboration within the

CBC network. CBC professionals can be located based on

specialty, geography, language and other criteria.

Library

The Library is a central, searchable storage area for

templates, forms, samples, etc. Using the documents stored

in the Library saves the time of having to recreate them.

cbcworldwide.com

The announcement of you joining the CBC organization mentioned aggregating and strengthening client resources and a services delivery platform. What does that mean?Sometimes it’s tough to understand

for people not familiar with the

business. I’m responsible for

managing all the operational elements

and services provided to clients so that there’s a consistent look

and effect, and that clients see the same level of services across

the country. That includes looking to develop resources to expand

our service capabilities to respond to clients’ needs.

What can a franchise-based company like the CBC organization do to be most successful?We’re primarily a franchise-driven organization; however, Rick

Davidson doesn’t want to stifle the independence and

entrepreneurial spirit of our affiliates. He has charged me with

creating a level of service and an operational platform for our

affiliates to leverage their existing business so they can be more

successful doing business with larger companies. In today’s global

economy, companies are looking for consistent platforms and

systems to be in place to provide them with the level of service

they expect. We want to develop, pull together and consolidate

information so that our offices have the tools to strengthen their

offerings. We want to help our offices compete in the wider arena

of today’s global marketplace.

Is that your vision for what ownership services can do? It’s really about services, best practices and centers of excellence.

When completed, I see an integrated suite of services that allow

You’re the former director of Real estate development for the state of florida. how do you view the move back into the corporate environment?While having recently served in a public administration, I have

over 25 years of real estate experience in management and

administration, all in commercial. I have an extensive background

in the private sector such as with REITs, owners and developers,

third-party management companies as well as with corporate and

public investors. I’d like to think that that’s valuable experience to

bring to the CBC organization. Hopefully my depth of experience

will be seen as a real resource.

TimDimondColdwell Banker Commercial®VicePresidentofownershipServices

“ourgoalistoestablishavertically-integratedserviceplatform,alongwithexpandedcapabilitiestoallowourofficestocompeteintoday’sglobalmarketplace.” — TIM DIMOND

The new CBC Vice President of Ownership Services talks about strengthening

and adding to the service platform for every Coldwell Banker Commercial office,

organizational knowledge and the current real estate environment.

20 The Insider WINTER/SPRING 2008

all our offices to do business across the country and around the

globe. It’s also about developing consistency, because offices will

have the ability to pull resources and knowledge from throughout

the Coldwell Banker Commercial® organization. Our goal is to

establish a vertically-integrated service platform, along with expanded

capabilities to allow our offices to compete in today’s global

marketplace. We are looking to an ownership services program that

will put the CBC company at the top of the industry, increase our

respect with peers and help acknowledge us a professional

innovator. One vision, one voice and one message will equal success.

What do you see as the biggest challenge? There are minor challenges, really. We are historically an

organization that has operated as a collection of independent

offices and operations. We have to get everyone to understand the

value of aggregating information and experience. If you went to

pitch the head of real estate for Google, you’d want to be able to

show the bench strength, the capabilities and the experience that

you could only get by tapping into expertise from other offices

working cooperatively with each other.

some ownership services include property management, construction management, agency leasing, investment sales and the capital markets business. Would you say one is more critical than another? Driving and expanding our service delivery platform touches all the

owners. We’re a heavy sales organization, with most of our revenues

coming from sales. Typically, our competition’s revenue is a mix of

sales, management, and other ancillary services. We want more

balance to help drive a consistent level of business for our offices.

Integration can provide cross-selling opportunities; when you’re just

transactional, you get one bite of the apple. When you’re a fully

integrated, turnkey operation, you get to eat the whole apple.

What do you see for ‘08? Two things; first, the collection, aggregation and consolidation of

the appropriate business information we have in the organization,

such as who we are in business with, the size and the scope, and so

on. Secondly, creating centers of excellence and sharing best

practices to get into new lines of business; this way, local offices

have the resources to go outside and get the subject-matter

expertise to win business. We have many opportunities in store this

year for our professionals to meet and collaborate, such as our

regional networking event program, and presence at major industry

trade shows, like the ICSC spring convention in Las Vegas. Our

2007 showing at ICSC was a huge success and we’re hoping for

even better results in 2008.

so ownership services will be 24/7, 365 days-a-year? Sure. Just like in my public service days.


CBC At ICSC. . .As Tim Dimond indicates, the CBC organization made a huge splash at the 2007 International Conference of Shopping Centers (ICSC) exhibition, and we hope to raise the bar for the 2008 event, which takes place May 18 - 21 in Las Vegas.

Attendees to the show50,000

2007 ICSC HIgHLIgHTS:

CBC Executive InterviewAConversationwithTimDimond

CBC Booth with multiple plasma screens and meeting rooms

4,500 sq. Ft.

Attendees at an exclusive cocktail party held inside the CBC booth

450

CBC Nationwide Retail Listings presented in retail property review booklets

250



Continued from page 04

The PoWeR of The PeN

President and COO Rick Davidson appears live on CNBC’s

morning business show, “Squawk Box.”

CBC Resources SpotlightToolsfortheCBCProfessional

country. In addition, we continued to “spread the CBC word” to

consumer and small business outlets by offering printable,

easy- to-read tips and guidelines. A press release explaining the

fundamentals of retail appeared in over 200 community

newspapers and publications nationwide. In addition, a recorded

radio spot giving tips for companies looking to expand their office

space is expected to run on a number of local stations

throughout the winter and spring.

But by far the biggest exposure for the Coldwell Banker

Commercial organization came in early 2008. CBC president and

COO Rick Davidson participated in a national outlet media tour in

Easy-to-use business resources and applications at your command, designed to

improve productivity and efficiency — all available on Blueprint.

ToolsoftheTradeJanuary, discussing general commercial real estate issues, and

highlighting some of the findings from a Coldwell Commercial

Banker co-sponsored survey conducted with National Real Estate

Investor. Rick met with high-level outlets including The Wall Street

Journal, Dow Jones Marketwatch and The Associated Press.

The tour culminated with the CBC organization’s first national

broadcast placement, as Rick appeared live on cable news leader

CNBC network’s popular morning business show, Squawk Box.

Widely considered the top “pre-market” morning business news

and cable television talk program, Squawk Box features the

biggest names in the corporate world, discussing important news

and business stories.

Out and About....In early 2008, Coldwell Banker Commercial saw the biggest publicity exposure in its history, as CBC President and COO Rick Davidson appeared on CNBC’s Squawk Box and met with several additional high-level outlets:

InstantClientAccessInstantClientAccess is a web-based service that provides real-

time access to your listings and transactions 24-hours a day.

Maintain accurate, up-to-date management of each project,

keeping your team and clients informed at all times, anytime.

A virtual “War Room” for projects, InstantClientAccess is

100% secure, with access granted only by you.

Use InstantClientAccess to manage:

• Tenant Representation

• Landlord Representation/Property Listings

• Acquisition/Disposition

• Corporate Services and Strategic Planning

• Build-to-Suit Development

• Spec Development

• Site Selection

Reis ProgramReis is one of the most trusted providers of impartial

commercial real estate performance information and

analysis at the city, neighborhood, and property level.

Through the Reis program, your company can run reports on:

• Sales Comps

• Rental Comps

• Rent, Vacancy, and Inventory Trends

• Market Reports

• Sub-Market Reports

• Trends & Economic Forecasts

• Construction

Listings ManagerListings Manager — a proprietary Coldwell Banker

Commercial® listing engine — allows you to provide your

current and prospective clients with the most comprehensive

marketing information about your properties.

Using Listings Manager, you can have increased control over your

listings, including the ability to easily adjust the location of the

point of your property on the map for cbcworldwide.com.

• Upload unlimited pictures, streaming video, property

details or attachments

• Enter detailed lease suite information, as well as individual

suite-by-suite photos

• Include a full array of financial metrics and analysis

• Ability to export data in XML format for web development,

LoopNet exports or Excel worksheets

• Controls distribution from the CBC® Central Data Exchange

(CDX platform)

• “Intelligent Database” based on property type

To sign up for the Reis

program, go to the Tools

tab on Blueprint.

A COLLABORATIVE SUPPORT SYSTEM

JUST ONE ELEMENT OF SUCCESS.

© 2008 Coldwell Banker Real Estate LLC. Coldwell Banker Commercial® is a registered trademark licensed to Coldwell Banker Real Estate LLC. An Equal Opportunity Company. Each Of ce is Independently Owned and Operated

Sometimes, standing tall requires plenty of collaboration and support. Th at’s why it helps to have the vast

global reach of the Coldwell Banker Commercial® system behind you. By providing unmatched resources to

our independently owned and operated offi ces, we help eliminate the obstacles that stand in the way of your

success. For the backing of a powerful national presence and the agility of a local market innovator, put your

trust in a Coldwell Banker Commercial professional.

A Realogy Company

ACCELERATE SUCCESS www.cbcworldwide.com

SM

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