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LIVINGSTON, NJ-Despite news yesterday that we are “officially” in recession mode, the message delivered at NAIOP’s New Jersey “Tenant Retention In Trying Times” seminar was marked not by doom and gloom, but rather what can we do better.

Panel moderator Bob Palestri, a partner with the Property Institute, emphasized this point by noting that “there are no trying times, only those who chose to sit on the sidelines.” He–along with panelists Glenn Buie of First Industrial Realty Trust; John Marazzo of Mack-Cali Realty Corp.; Seena Stein of Newmark Knight Frank; Michael Schofel of Eastman Co.; and Andrew Zezas, SIOR, of Real Estate Strategies Corp.–then proceeded to lay out a plan for keeping tenants in place, whether it be through tenant surveys, selecting the proper employees or investing more in tenant retention budgets.

While many of the questions posed elicited a variety of different responses, the takeaway was communication. “Many of us don’t know who property managers are…they are not who we first deal with,” says Stein. “In this time of horror, it’s important that we all hear and know what tenants want. We must maintain a relationship of trust. During the last economic downturn, tenants remembered which brokers hurt them.”

Added Zezas, “Landlords will say they have a great relationship with tenants but ask who the CEO is and they usually don’t know.” For tenant retention to work, said Marazzo, “it has to come from the top. There was a well-known New York City real estate executive who owned some great trophy properties in Manhattan, but behind his desk he had a sign that read, ‘I am the lord in landlord, you are the ant in tenant.’ Unfortunately, that mentality will trickle down to the rest of your company.”

To Marazzo’s point, one of the most talked about topics was retaining quality employees. With cost-cutting on nearly everyone’s mind, many panelists and attendees agreed that this is an ideal time to pick the proper staff members. “You really need to be a people person, while also understanding the nuts and bolts,” said Schofel. “You need to encourage everyone on your team,” added Marazzo, who noted that the current property manager of 101 Hudson in Jersey City began as an administrative assistant at Mack-Cali.

Driving most of this discussion was also the simply fact that tenant loss is a pricey one. According to Buie, the total losses accrued from a 10,000-square-foot tenant can creep as high as $250,000. “I know of a building in a different New Jersey county that was vacant for 111 months,” said Zezas. “It’s scary when you think about how expensive it is to lose a tenant. “Just think,” added Palestri, “what a difference you can make by putting an extra 5 to 10 cents toward tenant retention.”

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