I participated in a market tour recently for a significant size tenant and we looked at some of the Class A opportunities in Central New Jersey. Without naming names, one building stood out for all of the wrong reasons.
Unfortunately for the landlord, this building has had a vacancy rate of over 50% since mid-2008 and after walking the building, I understand why. While the lobby was presentable, albeit bland, and the cafeteria acceptable, but it was a different story once we got upstairs to the space.
When we arrived at the building, I explained to the broker that we had a very cubicle intensive layout and that it would be helpful if we could see the most open floor. There are ten vacant floors in the building and he chose to take us to a floor that has been vacant for six years.
The space looked as if the tenant vacated last week. While there was no furniture in place, nothing else had changed about the space. The walls were still painted a metallic blue, the carpet was the same, and most surprisingly, all of the interior partitions (walls) were still in place, meaning that the space wasn’t all that open.
Has the landlord simply not gotten around to doing some selective demo in the space to open it up a little? Do they not care? After sitting with the space for six years, these are some of the questions our client asked us after the walk through.
One of the hot button issues for the tenant is their need for an above standard parking ratio. Given the historical vacancy in the building, it was my thought that the landlord would be happy to hold some space off of the market to accommodate my client’s abundant parking need. After all, there are floors in the building that have been available for 15 years! In front of my client, the broker for the landlord argued the feasibility of providing the additional parking.
It was easy to see why the building has sat predominantly vacant and was good reminder how not to market space. As the saying goes, you only get one chance to make a first impression.