One of the world's largest commercial-real-estate-services firms has chosen what might seem like an inopportune moment to open its first full-service brokerage office in Phoenix.
The decision isn't as bizarre as it might seem to those outside the world of office-space leasing and shopping-center sales, according to Dennis Desmond, senior managing director for Jones Lang LaSalle in Phoenix.
Desmond, who joined the Chicago-based company in 2009 to staff up and then run the new Phoenix office, said it's a matter of being able to fire on all cylinders when clients need the extra boost.
While Jones Lang has been a full-service firm around the globe for years, he said, its business in Phoenix had been limited to facilities management, which consists of managing properties such as manufacturing plants or office towers on the building owner's behalf.
The recent rise in commercial-real-estate ownership by massive institutions, including Wall Street investment banks, corporate pension funds and big retail banks, has made it necessary for brokers who want in on that business to offer more services in a greater number of locations, Desmond and other Jones Lang officials said.
The shift to a full-service operation in Phoenix began in 2008, they said, when Jones Lang purchased real-estate-services firm the Staubach Co. from Dallas Cowboys football legend Roger Staubach. That immediately added a large, commercial-tenant-representation component to Jones Lang's Phoenix lineup.
In the two years since the purchase, it became clear that large, international real-estate firms such as Jones Lang could protect existing business, and pick up new business, because of their longer lists of services and geographic reach.
"Big, multinational corporations are the ones with the cash and the credit," Desmond said. What those clients want is a one-stop shop for all their commercial-real-estate needs in every major city, he said.
As a result of Jones Lang's expansion, several brokers from other Phoenix firms have come aboard.
Don Mudd, the former senior vice president of the former Grubb & Ellis/BRE Commercial brokerage in Phoenix, is one of those who has joined Jones Lang.
The independently owned Grubb & Ellis franchise where Mudd had worked changed its name and company affiliation in April to Cassidy Turley BRE Commercial. A new corporate-owned Grubb & Ellis office has opened under the leadership of Valley commercial-real-estate veteran Pete Bolton, who is senior managing director.
The commercial-brokerage business has been in turmoil since summer 2007, Mudd said, when brokers' phones suddenly stopped ringing.
"It was three years ago, almost to the day, and we were sitting around saying, 'What in the hell is going on?' " he said.
What had happened was gross oversupply of speculative office, retail and industrial space, commercial brokers now acknowledge.
It's unlikely the Valley will see any new office-for-lease projects developed for at least the next five years, Desmond said. It will be longer if Arizona doesn't attract some major new employers to the state, he said.
Fortunately, he said, a lot of businesses have been shopping around for inexpensive locations in which to expand or move, and Arizona commercial properties are very affordable compared with those in other cities, such as those in Southern California.
Another bit of good news is that all of the speculative office projects that were conceived during the real-estate boom are finally completed, Mudd said, which means the Phoenix area no longer will be seeing millions of square feet of unwanted office space opening up each year.
"The landscape you see now is the landscape we're going to have," he said.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment