Yes, You Need a Commercial Broker

Want to save money, time and aggravation?  Hire a broker!

There are literally dozens of variations of commercial leases; full service, gross, modified gross, NNN, NN, absolute net...you get the idea.  We will get into leases at a later date; but they are just one of the reasons you need to have a commercial real estate broker on your side when looking for space, negotiating a lease, or purchasing/selling commercial property.

Let me answer the first question most commercial brokers get asked when working with a client for the first time..."How do you (the realtor) get paid?"  While each case can be different, depending on the circumstances, in the Knoxville market it is standard business practice for the landlord to pay the commissions in a lease.  Hence, it doesn't cost the broker's client (the tenant) a dime to look for space. Commissions for property sales are similar to residential practices in that they are negotiated in the sale contract.


In the eyes of the state of Tennessee, and national groups like REALTOR, there is no difference between a commercial realtor and a residential realtor.  We all have the same licenses and took the same classes; it’s what we do with the license after it is earned that makes the difference.   Many commercial realtors earn designations that help educate them on marketing properties, helping clients make decisions on proper investments and the like.  Some you may have seen include CCIM (Certified Commercial Investment Manager); SIOR (Society of Industrial and Office Realtors) and CPM (Certified Property Manager).  These realtors have spent hundreds of hours in courses, and years in the field, to prepare them to meet their client's needs.

Two of the biggest reasons to use a commercial realtor are time and experience. 

Time is the one thing always seems to come up short.  Instead of spending your day driving around town looking for space that might be available (and hopefully in your price range) commercial broker have market knowledge and multiple interactive data bases at their fingertips to steer you in the right direction.  Say you want office space in west Knoxville; within minutes a commercial realtor can tell you what is available in that area, what it costs and the type of development in which the office is located.  The same can be said for retail and industrial space.  This way you can spend 15 minutes narrowing the list of potential spaces instead of three hours just trying to find out what is available and tracking down phone numbers.  

Commercial broker experience is what saves you money!  Any broker worth his salt will know the important details you need to help you make an informed decision.  Is this a new building?  If so, what kind of tenant improvement allowance will be included?  Is the rent abnormally high for the market and the economy (boy, does that really play a part now)?  What other kind of leasing incentives might the landlord provide? Should you lease or buy?

Commercial brokers will also have the experience to walk you through a lease (although most realtors are not lawyers and any lease should be reviewed by legal counsel prior to signing) to explain things like; force majeure, estoppel, operating expenses etc...

On the other side of the ledger, property owners can use the expertise of commercial realtors in much the same way.  Instead of spending your precious time looking for a tenant for your empty building a broker does it for you.   Commercial brokers are able to market the space via local and national data bases (basically a commercial multiple listing service), they can market the space through signage on the property and most importantly they talk to other brokers every day.  It helps them keep the pulse of the market; who is looking and how much space are they looking for. 

Commercial brokers can also help keep you apprised of market conditions.  Brokers are familiar with competing properties.  They know who is moving, who is downsizing, how needs to expand.  And a good broker knows what buildings are giving away the farm to find a tenant.  Commercial brokers are paid to know this information.  

Also important to owners is disposition of the property.  Better described as “What are you going to put in your pocket when you sell?”.  There is an entire CCIM course related to these transactions.  How should you price your property?  What kind of capitalization rates (cap rate) can the market withstand? What tax implications do you have when you sell it?  Experienced commercial brokers can walk you thru all these steps.

There are many more details that we can get into regarding commercial brokers.  The items above are strong evidence that an experienced broker is imperative to the success of your property search or ownership.

Cushman & Wakefield works on transactions like this every day. The biggest office and retail deals in Knoxville have been handled by nine brokers in our office.  Allow Cushman & Wakefield | Cornerstone help drive your next search. 

CCIM Nashville Economic Outlook

I spent an interesting afternoon at the Nashville CCIM Economic Outlook Conference yesterday.

Nashville truly has exploded in the last decade and Janet Miller,  chief economic development and marketing officer for the Nashville Area Chamber of Commerce, provided fascinating facts.

Snap shot:

• In the last 16 Nashville has courted 99 projects for expansion to the metro area.  Janet emphisized these are SERIOUS opprotunities for the region not just phone calls for companies looking for handouts. 

• If Nashville was able to successfully recruit all the projects they would total 33,000 jobs and cover 18,000,000sft of commercial real estate (office and industrial)

• 60% of the projects were considered Corporate Headquarters.  Funny quote from Janet, "Twenty years ago if a headquarters called us looking for a location we would not know how to act."

• Data Centers have become a huge part of the relocation process.  Bank of New York has invested more than $1 BILLION into a new data center in Nashville.  Why?  Because Tennessee is not subject to severe weather (like hurricanes) and earthquakes.  Also, Nashville is not considered a prime terrorist target.  Bank of New York's previous data center was destroyed on 9/11.

• The key to recruitment can be "The Spread".  Basically the cost of living vs the cost of business.  

• Nashville is the #1 destination for companies and employees moving out of Los Angeles.

I hope the trend extends to Knoxville.

The Power of Social Media

This month's CCIM Magazine, Commercial Investment Real Estate , included an article about the use of social media in gaining clients in commercial real estate (and it includes a few comments from yours truly).    

     While the immediate return on investment can't be calculated the prospects for growth are    

    enormous.   A link to the entire magazine is listed below. Enjoy

Build Your Business 

Through Social Media

Looking for new clients? You’ll find them online.

by Dennis LaMantia

Commercial real estate is all about relationships. So the industry's interest in social media — a venue where relationship building is turbocharged — should be expected.

"We have gained several clients because of the exposure we received through Facebook," says N. Justin Cazana, CCIM, principal at Cushman & Wakefield|Cornerstone CRES in Knoxville, Tenn. Cazana is one among many CCIMs who have used the social networking site as an effective business development tool.

As social media becomes a more integral part of business development, commercial real estate professionals are getting results by incorporating Facebook, Twitter, and other platforms into their marketing strategies. A social media presence can increase the likelihood of being found by new clients, establish professional credibility, and streamline communication. Although social media is free, it does require time to learn and maintain. So what's the return?

Quantifying the Value

"Learning about social media and setting up my profiles took a lot of time," says Chad Gleason, CCIM, of Real Estate Investment Services in Kent, Wash. Although it can be an efficient tool, there is an opportunity cost for overcoming the initial learning curve, refining messaging, learning new programs, and staying current on existing ones. And high-profile gaffes by celebrities and politicians remind users of the potential risks of participating in social media.

Given this risk and opportunity cost, commercial real estate professionals — people who rely on models and analysis for decision making — are naturally interested in measuring social media's return on investment. "It's hard to determine," says Greg J. Vollman, CCIM, of Apartment Investment Realty in Cincinnati, voicing a common sentiment among CCIMs.

Even Fortune 500 companies are still finding their footing in social media analytics. Ford Motor Co. recently launched a $95 million marketing campaign that included a Facebook page, but the company still had difficulty determining the value of the interest it generated. "They can give you Likes," Scott Kelly, Ford's head of digital marketing, told The Wall Street Journal, referring to the Facebook feature that allows users to provide quick, positive feedback. "But the question is, What is the value of those Likes?"

"It's too early to establish an ROI on the time I invest in social media," says Shawn E. Massey, CCIM, partner at The Shopping Center Group in Memphis, Tenn. "My goal was to increase exposure and keep my name in the retail community during this slow period. Based on that, it has worked very well."

However, one concrete form of measurement is new business. Cazana — whose company has four Facebook sites, three Twitter feeds, and two blogs — has gained several new clients as a result of social media. Daniel Palmeri, a senior associate at Colliers International in Las Vegas, uses LinkedIn to locate potential clients and connections to them. "This has resulted in a far greater success rate than a cold-call," he says. He attributes three closed deals to social media. Gleason says that 40 percent of his deals can be linked to social media connections, which gives him a larger presence in the market and a larger pool of lease tenants.

"When I get a call from someone I connected with through social media, I know my social media campaign is effective," says Martin Barkan, CCIM, CRE, senior vice president of First Property Realty Corp. in Beverly Hills, Calif. Barkan is working on several transactions that originated from connections on Facebook, LinkedIn, and his blog. "These transactions with new clients took six to 12 months to develop after the initial contact, but I believe the return on the investment will be exponential over the next two to three years. I'm certain this will be the single biggest market visibility and client growth platform in my business."

Being Found

Candice A. Donofrio, owner of Next Wave Real Estate Investments in Laughlin, Nev., gained referral business using social media. After reading a commercial real estate blog post, she found the author's Facebook page through a Web search. After commenting on the author's Facebook wall, she received a phone call from him about a business opportunity, which she referred to a colleague in Las Vegas.

Donofrio's story is an example of how social media can help with inbound marketing. Prospective clients are searching the Web for information about potential business partners, and LinkedIn, Twitter, and Facebook profiles and updates are often top results when an individual's name is searched.

"When someone searches for me, my LinkedIn page, Facebook business page, and Twitter profile are at the top of the results," Barkan says. Social media sites give users privacy settings to control what parts of their profiles appear in search engines. But it pays to have some information available to the public, especially if it's business-related. A recent Pew Research report found that 92 percent of adults use search engines to find information, making it the most common online activity, along with e-mail. Creating a social media profile can help commercial real estate professionals be found online, and it gives their peers a convenient way to communicate with them.

I'm There. Now What?

The initial aversions to social media are being replaced by questions about how to best calibrate and integrate social media into a broader marketing strategy.

Integrating social media into a marketing strategy doesn't have to become a part-time job. Palmeri limits his social media use to an average of 30 minutes a day. Other interviewees worked effectively with even stricter time limits. Third-party sites like Seismic, TweetDeck, and HootSuite improve efficiency by allowing users to update multiple social media profiles from one site. Using these time-saving tools, "I am able to update my Facebook and Twitter profiles with material from my blog with one click of the mouse," Barkan says.

An initial decision also needs to be made about how "social" social media should be. Users like Palmeri don't mind mixing business and personal information. "You need to express a little bit of your personality, which gives insight into who you are," Palmeri says.

Gant B. Hill, CCIM, president and principal broker of Venterra Realty in Louisville, Ky., also chooses to share personal information alongside business information. "I don't mind mixing the two," Hill says. "It creates character and makes you more approachable, but never take either to the extreme."

Facebook and Google+, Google's social network, allow users to have it both ways. Facebook users can create a group of business friends and share only certain updates with that group. Google+ offers similar functionality with its Circles feature.

For those looking for more separation between their business and personal lives, the solution is to create different profiles for each. "People who want to communicate their professional information to their personal network can simply post the relevant information in both places," says Jeffrey B. Pollock, CCIM, principal at Pollock Commercial in Atlanta.

What to Share

Sharing information about recent transactions, insights into local market observations, or trends in certain property types can help establish credibility among peers and potential clients. "People are looking to us for information, and we use social media to provide news about properties and tenants that have come to the market," says Cazana.

LinkedIn is a particularly good platform for such information. For example, Bob Rein, CCIM, associate vice president of NAI REOC Austin in Austin, Texas, posted a series of LinkedIn updates to attract investment from his home state of Arizona. What started as a single post about Austin market trends turned into series of 10 posts. A prospective client saw the posts and contacted Rein, suggesting they work together when an investment opportunity arises.

Finding business-related information to share can sometimes be as easy as repurposing existing content. Barkan takes advantage of the low incremental resource cost of social media by repurposing blog and newsletter content on Facebook and Twitter. Businesses and individuals without blogs can still create a social media presence by finding quality industry information and sharing it with their followers. CCIMs can share insights by applying CCIM education concepts to current commercial real estate news.

Other sources of business-related information include quotes from industry events, reactions to other users' posts, product reviews, and more. A little bragging doesn't hurt either. "I used LinkedIn to announce earning my CCIM designation, and my profile views went up significantly as a result," Rein says. His connections congratulated him on the accomplishment and asked for information about the designation.

Social media is about building relationships, and in the U.S., that relationship building is mostly occurring on Facebook. The site dominates among social media platforms. U.S. Internet users spend 16 percent of their online time on Facebook, according to Citi Investment Research and Analysis, a figure that has steadily increased over the past few years. Businesses are recognizing the importance of going where their customers are. Booz & Co. recently reported that 94 percent of the businesses surveyed view Facebook as one of their top three social media priorities, followed by Twitter with 77 percent and YouTube with 42 percent. The same report found that 96 percent of companies plan to either allocate substantially or somewhat more resources to social media.

Part of the appeal of Facebook and other social media sites is their reach. Social media provides an opportunity for businesses to reach outside their customer contact lists to a much bigger audience. "The more I grow my social media presence the more my inbound marketing increases, which has been essential to growing my business," says Barkan, who like other CCIMs, is finding that making sense of social media makes business sense.

Dennis LaMantia is interactive marketing manager at the CCIM Institute.

http://www.ccim.com/cire-magazine/issues/janfeb12?current

The Wonderful World of Retail...how to pick it

Wow!  Talk about a tough market to get into.

Opening retail operations in these economic conditions is a 50/50 proposition.  The unsteadiness of the economy has many people worried but you have to hedge your bets against some very opportunistic lease rates.  Still, the rent costs should be a very small percentage of your budget and certainly not the decision maker into whether or not to open new store. 

Finding the ideal space in the ideal location

I will let individual business owners make thier own decsions about the economy, but there is a plethora of retail space available all over Knoxville.

Almost every center from Strawberry Plains to Turkey Creek has some type of space available.  Some property owners are in more dire situations than others.  A older center may not have the debt service of new construction so the owners may not be as motivated to deal.  But some centers that were once asking $28.00 per square foot in popular location are down below $20.00.  Those are pretty serious concession.

Even if you are getting a “deal” there are many details to consider before choosing a location.

1.   Of course, Location, Location, Location: Walk in traffic is the best way for a new retailer to be discovered. Spend time in the neighborhood, learn the flow of traffic, the demographic, etc.

2.    Type of space: What side of the street is the space on? Do you get afternoon sunlight? Is the space deep and dark? Is there a lot of wasted square footage in the space? Notice as much as you can on the first tour and make sure to come back several times at different times of day.

3.    Neighbors/competitors: What businesses are located in the area?  Will their customers see value in your merchandise or service? Ask other merchants about the pros and cons of the area.  

4.    Crime:  Being in a neighborhood that is gentrifying or potentially has some crime issues can be acceptable for an office, but potentially disastrous for a retail outlet. Your most valuable asset is your inventory and although insurance will help make up for losses, it is a major distraction from your business. Do a little research and see how many police reports have been filed within a mile of your potential location.

5.    Parking: How far away are the nearest parking areas? Do your customers need parking or will most of them be walking to your location?  The ability to have your customers park close by and affordably is extremely important.

6.    Signage: How big of a sign do you need to attract attention? What are the regulations of the landlord or the city as it relates to signage? Make sure to check out the neighbors and ask them how they got through the system if the regulations limit what you are hoping to do.

7.    Foot traffic: How busy is the street during the daytime? How busy is the street during evening hours? What types of people seem to be walking around? Is their a bus stop or school nearby. Take note of who walks by and what percentage of people seem to be window shopping because the more people looking the higher likelihood you’ll find a new customer.

8.    Brokers: Most shopping centers will have a broker to negotiate the deal…you should too.  They are experts in finding you the proper space, picking out the details and getting you the lease you need.

Potential hidden cost:  NNN Pass thrus.  We have discussed these before.  Shopping centers are not trying to hide these numbers from potential tenants but they are calculated differently than rent.  They are CAM (common area maintenance), taxes and insurance; also know as pass-throughs or NNN charges.  They are different at every center.  Some NNN charges are as low as $2.50psf in older centers or neighborhoods.  NNN charges in lifestyle centers such as Turkey Creek can be between $5 and $8 per square foot!  In many cases these charges are passed through directly from the property owner to the tenant without mark up.  But they can still add a considerable amount to your monthly rent check so pay attention to these.

Basically, if the time isn’t right don’t force the issue.  Find a good broker who is experienced in the field to guide you along and make the decsion when all the pieces fit properly. 

Cushman & Wakefield|Cornerstone CRES manages and leases more than 400,000sft of retail space in the Knoxville market.  If we can be of assistance please let me know so you business has the proper headstart. 

www.cornerstonecres.com   //  865-617-2989   //  jcazana@cornerstonecres.com

Justin Cazana, CCIM

So you need a new office...

It’s a good time to be looking for office space.  It’s a good time to be looking for any type of space if you have decent financials, but office space in particular. 

West Knoxville has been slightly over-built in the past few years.  The space is slowly getting leased, especially in the last quarter, but still plenty of inventory remains.

Types of Office Space

There are three basic types of office space; Class-A, Class-B, and Flex Space.  Some markets have Class-C space but not many people in Knoxville classify buildings that way.   Office buildings are classified according to a combination of location and physical characteristics. Class B and Class C buildings are always defined in reference to the qualities of Class A buildings. There is no formula by which buildings can be placed into classes; judgment is always involved.  A building in downtown Knoxville that might be considered Class A would be a Class B building in Nashville or Atlanta. Also fair number of the Class C office spaces in the inventory are not truly office buildings but rather walk-up office spaces above retail or service businesses.

Century Park I
Class-A

Class A Office Space describes the highest quality office space locally available. The architecture of Class A office structures usually prioritizes design and visual appeal over cost, (and sometimes over practicality).  In most areas, Class A office space is built in multi-story (usually 2 floors or more), multi-tenant buildings using structural steel and composite concrete construction. 

The Urban Land Institute says the following about these classifications in its Office Development Handbook: "Class A space can be characterized as buildings that have excellent location and access, attract high quality tenants, and are managed professionally. Building materials are high quality and rents are competitive with other new buildings. Class B buildings have good locations, management, and construction, and tenant standards are high. Buildings should have very little functional obsolescence and deterioration." 

Class A buildings are typically very functional.  They provide a strong parking ratio, lots of natural light on the interior of the building and are more energy efficient than their predecessors.

Good examples of Class-A space are the new developments at Century Park at Pellissippi, Lakeside Center off of Northshore and Brookview Town Center off of the Papermill exit.  Lease rates for Class-A space will vary from $17.50psf to $24.00psf in Knoxville.  Most all Class-A multi-tenant buildings will be full service or modified full service with the tenant paying for utilities. 

Corporate Square/Cedar Bluff
Class-B 

Class B space can be found in a variety of areas around Knoxville.  Cedar Bluff has a plethora of Class B developments like Corporate Square and Executive Plaza.  Much of downtown would be considered Class-B space, with the exception of about five buildings.  Typically, any building over 20 years old would be considered Class-B.  There is NOTHING wrong with being in Class-B space.  They are very practical and more economically viable for many businesses.  In fact, most Class-B buildings were once Class-A buildings that time has caught up with. 

Class B space is ideal if you own a business that doesn’t require flash to show off to your clients and customers.  The only real difference in Class A and most of Class B is age and management.  They were designed and built in a different time. Instead of floor to ceiling windows you might get smaller four foot windows.  The HVAC units may be dated, or even residential units, that are not as efficient.  All that being said, if a building has the proper management over the years it’s Class-A status can be extended beyond 20 years.  

Lease rates for Class-B space start at about $12.00psf to $15.00psf in Knoxville.  The levels of service provided by the landlord can also vary from building to building and submarket to submarket.  

Flex space can also be considered office/warehouse.  The office-to-warehouse can be 10% office - 90% warehouse; 90% office – 10% warehouse; or anywhere in between.  It just depends on what you need. Buildings in the Baum Drive area or near Mabry Hood & Kingston Pike would also be called classified as flex space. 

Center Court at Lonas
Class-A

There is plenty of space to be found in Knoxville. A 2007 report from the Metropolitan Planning Commission (MPC) shows that Knoxville and Knox County have a total of nearly 19 million rentable square feet of office space, including 5 million feet downtown and 4.5 million in the Pellissippi Parkway submarket.  Those numbers have increased since additional buildings were completed in the Papermill/Weisgarber area and Pellissippi corridor.  

Your office needs to be in the location and environment that suits its business plan.  

If you often need to impress clients and customers in your office during sales meetings Class A could be the way to go.  In fact, Class A building can be considered a monument and a testament to the success and power of its tenants.  That might be why Century Park, with four buildings all under five years old, has seven Fortune 500 companies as tenants.

If you rarely have customers in your office, Class B can be a viable option.  No reason to pay for flash if you don’t need it (unless you really want it).

As always, Cushman & Wakefield | Cornerstone CRES can help you find the space that best suits your needs.  You can reach us at 865-617-2989 or jcazana@cornerstonecres.com.  Check out our available properties at www.cornerstonecres.com.

Get to know your Broker!

Oh its important. You wouldn't leave the sale of your house to a random stranger who may, or may not, know anything about the market.  If you are looking for a new office, warehouse or store space having a knowledgeable, experienced broker is imperative.  It maybe be even more important for investments.  You will have to put a lot of trust into the person who will help you find the property that fits in your portfolio.  You must know that he will provide you with the information you need.

With that being said...here is the Cushman & Wakefield|Cornerstone team.  With more than 125 years of experience, the team has the local market knowledge and national brokerage experience to get you through any transaction.

John M. Adams, III CCIM/SIOR

PRINCIPAL

EMAIL:  jadams@cornerstonecres.com

John M. Adams is a founding Principal with Cornerstone in Knoxville, Tennessee.  A Knoxville native, John is involved in the sales and leasing of office properties. After graduating from the University of Tennessee, John obtained his Affiliate Broker license, was involved in real estate management and development, and joined Wood Properties in 2003.  John is one of three brokers in the Knoxville market to obtain both his CCIM and SIOR designation. 

Don Brewer, CCIM

PRINCIPAL

EMAIL:  dbrewer@cornerstonecres.com

Don Brewer is a founding Principal of the Knoxville office of Cornerstone.  Previously, he was founder and principal of Realty Investment Services, a commercial real estate brokerage and management firm he successfully ran for 10 years.  Don specializes in office sales, leasing, and development in addition to brokerage of development sites, retail leases, and investment sales.  He has a broad range of practical business experience and expertise in real estate financial analysis.  Don is the 2010 Knoxville CCIM Broker of the Year.

Justin Cazana, CCIM

PRINCIPAL

EMAIL:  jcazana@cornerstonecres.com

Justin Cazana is a founding Principal and Broker with Cornerstone in Knoxville, Tennessee.  Justin specializes in office and retail transactions with experience representing both landlords and tenants.  His current portfolio encompasses more than 1.1 million square feet of commercial space.

A Knoxville native, Justin began his career with Commercial & Investment Properties handling the leasing and marketing of the companies’ buildings.  This includes Knoxville landmarks like Century Park at Pellissippi (an 80-acre office development), The Atrium, and Two Centre Square.  Justin in the former president of CCIM in Knoxville. 

Jim Holleman, CCIM

PRINCIPAL

EMAIL:  jholleman@cornerstonecres.com

Jim Holleman is a founding Principal in the Cornerstone branch in Knoxville, Tennessee.  He started in the real estate industry in 1979 on the retail side of the business in North Carolina, then continued his experience with the Herring Marathon Group in Texas.  In 1985, Jim moved to Knoxville leasing shopping centers in Tennessee, Alabama and South Carolina for Fortune, Masingil and Parish, the largest shopping center developer in Tennessee at that time.  In 1989, he formed Asset Management and Development, a real estate and development firm that developed numerous office properties in the Knoxville area and managed the Andrew Johnson Office Plaza for Aetna Life and Casualty.  In 1994, Jim merged his company into Wood Properties, Inc. and returned to full time brokerage, specializing in industrial, investment sales, and development.

Dan Atkins

ASSOCIATE DIRECTOR

EMAIL:  datkins@cornerstonecres.com

Dan Adkins is an Associate Director at Cornerstone in Knoxville, Tennessee.  He has been an active entrepreneur in the Knoxville business community for his entire adult life.  After graduating from Middle Tennessee State University in 1979 with a B.B.A., Dan opened a chain of retail stores that he ran for over 24 years.  In 1997, he sold most of his businesses and retained the commercial properties.  In 1998, Dan started an auto manufacturing and fabrication business which he operated for 6 years. For the past 20 years, Dan has invested, managed, and leased retail and office/industrial properties in the Knoxville area.

Leslie Bauges 

ASSOCIATE DIRECTOR  

EMAIL:  lbaugues@cornerstonecres.com

Leslie Baugues primary responsibility at Cushman & Wakefield|Cornerstone CRES is leasing retail shopping centers. As an East Tennessee CCIM chapter member and an active member of ICSC, Baugues is ideally suited to grab hold of the market.  She holds degrees from both the University of Tennessee and the University of Kentucky.  Prior to joining Cushman & Wakefield|Cornerstone she worked for Holrob Commercial Realty for ten years, where she leased and developed shopping center across the United States. 

 

Jake Brewer, CCIM

ASSOCIATE DIRECTOR

EMAIL:  jbrewer@cornerstonecres.com

Jake Brewer is an Associate Director with Cornerstone in Knoxville, Tennessee, specializing in site selection and tenant representation. Jake also handles acquisitions and dispositions for retail, office and industrial property types. After graduating with a degree in Finance and Marketing from the University of Tennessee in 2006, Jake joined First Southern Mortgage in Nashville as a commercial real estate analyst. At this position, he worked with a senior producer arranging permanent financing, construction loans, and equity placements for commercial properties totaling over $100 Million. Jake then joined  Realty Investment Services, a Knoxville based brokerage firm, as an affiliate broker where he completed over 200,000 square feet of commercial real estate transactions in his first year.

Rick Gentry

ASSOCIATE DIRECTOR

EMAIL:  rgentry@cornerstonecres.com

Rick Gentry is an Associate Director at Cornerstone Commercial in Knoxville, Tennessee. Mr. Gentry has extensive knowledge and experience in multifamily properties including brokerage and development. Rick is a member of the East Tennessee Chapter of CCIM (Certified Commercial Investment Member) and is actively pursuing his CCIM designation

Mitch Taylor, SIOR/CCIM

DIRECTOR

EMAIL:  mtaylor@cornerstonecres.com

Mitch Taylor is a Broker with Cornerstone in Knoxville, Tennessee.  He has 21 years of experience as a Realtor, specializing in the sale of commercial real estate.   Before joining Cornerstone, Mitch was a Partner at Realty Investment Services for 3 years; before that he worked as a Associate Broker at NAI Knoxville for 18 years.

John N. Rebori, Jr., CCIM

ASSOCIATE DIRECTOR

EMAIL:  jrebori@cornerstonecres.com

John N. Rebori, Jr. serves as an Associate Director for Cornerstone, specializing in the sale and leasing of retail investment properties in the east Tennessee market.  John is a licensed broker in both Tennessee and North Carolina and has successfully closed more than 250 commercial real estate transactions since 1999. His experience includes Single Tenant Investment Buildings, Shopping Center Investments, Site Selection, Restaurant and Foodservice Site Selection and Sales, Landlord Representation, Retail Leasing and Sale-Leaseback Investments.  Prior to joining Cornerstone, John served as a Senior Advisor with Sperry Van Ness / R. M. Moore, LLC in Knoxville, Tennessee, and has been listed as a top agent in sales and leasing volume as well as top leasing agent.  

Another bonus to working with Cushman & Wakefield|Cornerstone CRES is the depth of resources we can bring to bear on any transaction.  Cushman & Wakefield has a global reach the includes; valuation, disposition, facilities management, corporate services and capital markets.   A great example of Cushman & Wakefield's reach is in Chicago.  At one time the tallest building in the world was the Sears Tower.  Thanks for Cushman & Wakefield's team of real estate experts Willis Insurance signed a 400,000sft lease in the building which included naming rights.  Not many firms can get one of America's iconic landmarks renamed but Cushman & Wakefield was able to get it done. 

  

Yes! You need a Commercial Real Estate Broker!

Commercial brokers get the deal done.

There are literally dozens of variations of commercial leases; full service, gross, modified gross, NNN, NN, absolute NNN...you get the idea.  We will get into leases at a later date; but they are just one of the reasons you need to have a commercial real estate broker on your side when looking for space, negotiating a lease, or purchasing/selling commercial property.

Let me answer the first question most commercial realtors get asked when working with a client for the first time...                                      "How does the broker get paid?"  While each case can be different, depending on the circumstances, in the Knoxville market it is standard business practice for the landlord to pay the commissions in a lease.  Hence, it doesn't cost the realtor's client (the tenant) a dime to look for space.  

Commissions for property sales are similar to residential practices in that they are negotiated in the sale contract.  

In the eyes of the state of Tennessee, and national groups like REALTOR, there is no difference between a commercial realtor and a residential realtor.  We all have the same licenses and took the same classes; it’s what we do with the license after it is earned that makes the difference.   Many commercial realtors earn designations that help educate them on marketing properties, helping clients make decisions on proper investments and the like.  Some you may have seen include CCIM (Certified Commercial Investment Manager, http://chapters.ccim.com/easttennessee); SIOR (Society of Industrial and Office Realtors, www.sior.com) and CPM (Certified Property Manager).  These realtors have spent hundreds of hours in courses, and years in the field, to prepare them to meet their client's needs. 

Two of the biggest reasons to use a commercial realtor are time and experience.  

Time is the one thing everyone has a shortage of.  Instead of spending your day driving around town looking for space that might be available (and hopefully in your price range) commercial brokers have market knowledge and multiple interactive data bases at their finger tips to steer you in the right direction.  Say you want office space in west Knoxville...within minutes a commercial realtor can tell you what is available in that area, what it costs and the type of development in which the office is located.  The same can be said for retail and industrial space.  This way you can spend 15 minutes narrowing the list of potential spaces instead of three hours just trying to find out what is available and tracking down phone numbers.   

Commercial realtor's experience is what saves you money!  Any broker worth his salt will know the important details you need to help you make an informed decision.  Is this a new building?  If so, what kind of tenant improvement allowance will be included?  Is the rent abnormally high for the market and the economy (boy, does that really play a part now)?  What other kind of leasing incentives might the landlord provide? Should you lease or buy? 

Commercial realtors will also have the experience to walk you though a lease (although most realtors are not lawyers and any lease should be reviewed by legal counsel prior to signing) to explain things like; force majeure, estoppel, operating expenses etc...

On the other side of the ledger, property owners can use the expertise of commercial realtors in much the same way.  Instead of spending your precious time looking for a tenant for your empty building a realtor does it for you.   Commercial realtors are able to market the space via local and national data bases (basically a commercial multiple listing service), they can market the space through signage on the property and most importantly they talk to other brokers every day.  It helps them keep the pulse of the market; who is looking and how much space are they looking for.  

Commercial realtors can also help keep you apprised of market conditions.  If several of the building around yours lease space for well below what you are asking the broker can determine if you are asking too much.  Commercial realtors are paid to know this information.   

Also important to owners is disposition of the property.  Better described as “what are you going to put in your pocket when you sell”.  There is an entire CCIM course related to these transactions.  How should you price your property?  What kind of capitalization rates (cap rate) can the market withstand? What tax implications do you have when you sell it?  Experienced commercial realtors can walk you thru all these steps.

There are many more details that we can get into regarding commercial brokers.  The items above are strong evidence that an experienced broker is imperative to the success of your property search or ownership. 

Cushman & Wakefield|Cornerstone CRES (www.cornerstonecres.com) is the market leader in experience.  More than three dozen brokers canvas middle and east Tennessee in the office, retail, multifamily and industrial markets.  From simple lease deals to complicated capital market  international transactions; Cushman & Wakefield has the resources to make the deal as easy as possible for its clients. 

Justin Cazana, CCIM

Principal/Broker

Cushman & Wakefield|Cornerstone CRES