Case Studies

A Fortune 500 multinational financial services firm decided to consolidate related enterprises into a regional East Coast operations and headquarters facility. SCRE was hired to help manage the consolidation.

SCRE first conducted a demographic survey of a diverse employee group that lived in three neighboring states. Ease of access via public and private transportation was a key requirement. Once an appropriate location was identified, SCRE, along with the company and its other professionals, structured municipal tax benefits and lease terms with a major REIT. This, in turn, facilitated the construction of a 575,000 sq. ft. office tower. During lease negotiations, SCRE assisted the client with items such as the MEP design to accommodate various uses ranging from trading, computer, executive office, support services, cafeteria, and major backup services.

Within 36 months of conception, a first-class 17-story office building was constructed for the tenant’s use and enjoyment.

Senior management determined that its existing computer facilities needed to be replaced due to functional inefficiencies and expanded bandwidth requirements. SCRE was hired not only to find the sites but to do so in a staged process with a minimum capital to be spent by the corporation.

SCRE worked with the client’s I.T. and real estate and facilities departments to understand staffing, technical needs, and geographic constraints. Available power levels and redundancy of service, infrastructure, connectivity, expandability, and timing were to be considered.

Once the review process was completed, SCRE worked with its local representatives and surveyed the area for suitable facilities. In addition to typical office concerns and support services, floodplain issues, climate, access, and fiber service had to be considered.

Within 12 months of inception, the client was able to take down a primary site of roughly 10,000 useable sq. ft. that was to be delivered “rack-ready” with UPS, air conditioning, two-foot raised floor, generators, full engineering with an initial clean power load of 100 watts per sq. ft. Both the power level and floor space included expansion options which were later exercised. The capital outlay was minimized, and an orderly migration occurred.

A second site was required to provide an adequate disaster recovery infrastructure. This site was larger, with a net saving in excess of $25 million being afforded to the client as the space was in a regular office building, with power and the majority of support services in place already. Some capital was required, with a quick payback due to reduced rent. SCRE facilities group not only helped to secure the space but also played a role in reviewing MEP design which reduced capital outlay by nearly $5 million.

Burdened by too few branches, poor market penetration, and operating inefficiencies, the client’s key executives determined that it was necessary to expand and redefine its retail delivery system.

SCRE worked with the client to:

• Analyze the existing branch network.
• Identify appropriate target markets (for current and future growth).
• Establish optimal space requirements for improved retail delivery.
• Analyze back office requirements and employee demographics.

The existing network was initially increased from two to five branches, and operations were effectively consolidated to one central location… all at no additional rental expense. The new branch network was well-placed and accommodated orderly growth in the New York metro area.

Management had decided that while outsourcing appeared to be the least expensive route for many operations functions, quality and repeat calls were having a negative impact on quality and the firm’s bottom line. Challenges confronting the company included the level of education, labor pools, language barriers, and costs to operate.

SCRE, along with a consulting affiliate, designed a program to evaluate regional education, levels of employment, age of the population, other major employers, infrastructure, municipal benefits, and language skills. Once completed, surveys were sent out, and communities were carefully compared. A list of semifinalists was created, and site inspections followed.

Within 18 months after process initiation, two service centers able to accommodate up to 750 seats each were opened in Mid-Atlantic US and Eastern Europe. Costs were reduced, and customer satisfaction was brought back in line with management expectations.

A Class-A Midtown Manhattan office building had been plagued with consistently underperforming rental rates, hold, and vacancy rates while concurrently experiencing operating and construction inefficiencies. SCRE was hired to complete a comprehensive operational and leasing audit.

The SCRE team conducted a complete review of all operations, contracts, staffing, planned capital improvements, project management, construction, marketing, and leasing reporting.

Within 60 days, SCRE submitted a detailed report highlighting problem areas and recommendations. This report inspired ownership to initiate a specific long-term plan that would reposition the property with a completely new team under a more competitive fee structure.

SCRE professionals assisted with the following:

• New Independent Project Management Team
• Phasing Out of the Existing Leasing and Management Team
• Hiring of New Leasing and Management Team

SCRE created a detailed RFP for each of the above written and oral presentations were provided and overseen by SCRE, which included an unbiased grading system. SCRE toured other managed properties and submitted observations. Fees for all services to be provided were negotiated in a competitive environment.

All pending capital improvements were reinitiated with savings over initial bids in excess of 20% ($1 million) with an on-schedule completion. A new leasing and managing agent were hired with a concise reporting structure. The property was re-introduced to the marketplace with greater building awareness and with a more competitive leasing package.

SCRE continues to advise the owner on virtually all matters.