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Building Successful Relationships

Monthly Archives: June 2017


Why You Need a Collaborative Work Environment

collaborative work environmentIn recent times, more and more companies are focusing on a collaborative work environment. Workspaces that allow the employees to work together will improve the overall performance of the company, including morale. When the morale of a company is high, employees naturally are motivated to work as a team. Instead of working in an isolated cubicle or desk, people are more keen to join in a community setting or potential work table. With the proper community work table, setting, or conference table, your employees will get an opportunity to interact with each other, share stories, and exchange more productive ideas.

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HERE ARE THE BENEFITS OF IMPLEMENTING A COMMUNITY WORK TABLE AT THE OFFICE:

Improve the work experience
Researchers found that people working in a collaborative work environment are more content with their work life. In a community workspace, employees will naturally come together from different projects or even from different offices. Take what we did here at Boomerang. In one of our conference rooms is a large circular table.
This allows all of us to sit at the table, no different from one another. The stress is low, but motivation is high. When people from different levels get an opportunity to share the workspace, they can help each other. Whether that is personally or professionally.

Controlled Environment
Shared tables have a more stress-free environment as there is more interaction. Co-workers in the shared work table can create a sense of discipline and a working structure to make them feel more motivated. Making the office, human – Each collaborative work environment has its own vibe. The idea of sharing a table at work helps greatly in team building. The managers and the employees can understand each other’s needs. The stiffness goes away and allows the team to become more productive.

Companies should encourage these type of work settings as they promote the sense of community beyond the meeting rooms. This kind of collaborative work environment also helps in organizing training programs, networking events, and corporate meetings. As people sit together for the better half of their day,
they come to know about each other’s problems, and can find out a way to solve them.

If you’re looking to grow the community within your office, we want to speak to you directly. Reach out to your favorite South Jersey Pre-Owned Office Furniture company to get a quote. www.boomerangofficefurniture.com

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WCRE Adds Accomplished Business Development Officer Tom Bove

Tom Bove to Expand WCRE’s Relationships in Professional Service Sector

Tom BoveWolf Commercial Real Estate (WCRE) is pleased to announce the hiring of Tom Bove, who will serve as Business Development Officer.  Bove brings more than 20 years of sales leadership and business development experience to complement the skilled team at WCRE. 

As Business Development Officer, Tom will work closely with WCRE’s sales professionals and its Director of Strategic Relationships to generate new business relationships with service professionals in the region.
A consummate business connector and manager, Bove has developed an extensive network of trusted relationships leading sales teams and managing customer accounts for the past two decades.  In addition, his experience in the tech and IT sectors will open new avenues of opportunity for WCRE.

“Each new member of our team strengthens our ability to meet specific client needs,” said Jason Wolf, founder and managing principal of WCRE. “Tom brings a valuable background as a leader who can build and manage new business relationships, allowing WCRE to serve clients in new ways.”

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About WCRE

WCRE is a full-service commercial real estate brokerage and advisory firm specializing in office, retail, medical, industrial and investment properties in Southern New Jersey and the Philadelphia region. We provide a complete range of real estate services to commercial property owners, companies, banks, commercial loan servicers, and investors seeking the highest quality of service, proven expertise, and a total commitment to client-focused relationships. Through our intensive focus on our clients’ business goals, our commitment to the community, and our highly personal approach to client service, WCRE is creating a new culture and a higher standard. We go well beyond helping with property transactions and serve as a strategic partner invested in your long term growth and success.

Learn more about WCRE at www.wolfcre.com, on Twitter & Instagram @WCRE1, and on Facebook at Wolf Commercial Real Estate, LLC. Visit our blog pages at www.southjerseyofficespace.com, www.southjerseyindustrialspace.com, www.southjerseymedicalspace.com, www.southjerseyretailspace.com, www.phillyofficespace.com, www.phillyindustrialspace.com, www.phillymedicalspace.com and www.phillyretailspace.com.

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2017 Summer HVAC TIPS

Summer HVAC TIPS2017 Commercial HVAC tips. The June 21 Summer Solstice marked the official start of summer! And with that comes fun times at the shore, BBQs… and hot and humid weather! But don’t sweat, with a little planning, you can ensure a comfortable working environment in your office.

Hutchinson, a leading energy services and mechanical services contractor serving the Tri-State Region’s commercial customers, offers tips to help add life to HVAC systems, keep you feeling comfortable, and improve the bottom line.

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Get an AC inspection and tune up.

Hutchinson’s certificated technicians will test the HVAC system to determine if any repairs are needed. Preventive maintenance will keep the system running smooth and efficiently, and extend its service life, too.

Change filters.

It’s a new season, which means it’s time to change your filter. As a rule of thumb, change filters every quarter or as needed.

Install programmable controls.

Get peace of mind knowing your AC is set just right – not too low and not too high – with a 21st century control system. It provides greater efficiency and can be controlled from a mobile device. Plus, Hutchinson’s Honeywell Web Certified technicians can access temperature controls online, and quickly monitor and repair any heating or cooling issues remotely.

Get ductwork inspected and cleaned.

Leaks or cracks can reduce energy efficiency in HVAC systems and result in higher utility bills. A duct system that’s properly cleaned and sealed can save businesses money and promote wellness and comfort.

Keep outdoor areas clear.

Check out your exterior HVAC unit. Is it clear from brush and debris? Make sure plants or branches aren’t blocking or touching the unit. A good rule of thumb is to have two feet of clearance around the unit.

To learn more about Hutchinson and its energy service offerings, contact Dicoordinator@hutchbiz.com or call 888-777-4501 to schedule an energy assessment.

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When Your Commercial Tenant Files for Bankruptcy

commercial tenant files for bankruptcyWhen a commercial tenant files for bankruptcy is not often a surprise to its landlord. Rent payments may arrive late, financial covenants may be missed, and the tenant may become generally unresponsive in the pre-bankruptcy period.

While the provisions of the bankruptcy code governing the treatment of leases are among the more complex in the code, this article provides guidance to landlords in navigating a commercial tenant’s bankruptcy and maximizing recovery on its claims.

Download this Article: When a Commercial Tenant Files for Bankruptcy (PDF)

Beware of the Automatic Stay when a commercial tenant files for bankruptcy

Upon learning a tenant files for bankruptcy , the landlord must abide the automatic stay. The automatic stay restrains actions to collect on a claim against the tenant, including enforcement of a judgment, creation of a lien, or otherwise attempting to recover any of the tenant’s property. The landlord may not, therefore, send a default letter or prosecute an eviction action. While limited exceptions to this general rule exist, a landlord should consult with counsel before taking any post-bankruptcy legal action against its commercial tenant. In some cases, the court may impose sanctions for willful violations of the automatic stay.

Monitor the case and gather pertinent documents when a commercial tenant files for bankruptcy

Carefully monitor a tenant’s bankruptcy case from the outset by reviewing all pleadings sent in connection with the case. Often, motions filed in the first days of a bankruptcy case set critical deadlines and tee-up for court approval mechanisms for funding the debtor through bankruptcy, including authority for the debtor’s use of assets (assets that may be subject to a landlord lien) during the course of the case. Pay special attention to the deadlines for filing proofs of claim and for filing proofs of rejection damages, each of which require affirmative landlord action to recover unpaid sums under the lease. Closely review any budgets filed by the tenant to confirm that the budget includes post-petition rent payments in the correct amounts. Consider retaining counsel to appear in the case, which will ensure that you receive prompt notice of events in the case and relevant deadlines.

Gather all documentation pertinent to the bankrupt tenant in order to readily assert claims in the bankruptcy case, including to support a motion for relief from the automatic stay if it becomes necessary. Ensure you have copies of the following:

• A fully executed copy of the lease, any amendments and guaranties
• Records of rent payments, both before and after the bankruptcy filing
• Records of maintenance obligations and payments
• Default correspondence
• Any property searches obtained showing liens created by the tenant

Disposition of the lease and payment of rent and other sums when a commercial tenant files for bankruptcy

tenant files for bankruptcy

Whether or not a commercial landlord desires to continue its business relationship with the bankrupt tenant, the bankruptcy code allows the debtor to exercise its business judgment to determine whether to assume (retain) or reject (terminate) an unexpired nonresidential lease.

If the tenant assumes the lease, it must make the landlord whole for any unpaid rent and any pecuniary losses stemming from the defaults under the lease. The tenant must also provide to the landlord “adequate assurance” of its future performance under the lease. With respect to shopping center leases, the bankrupt tenant must meet a higher standard than other tenants in order to assume the lease. The shopping center tenant must show: (a) that the debtor, as reorganized, or its assignee, will have at least the same ability to pay the rent as the initial lessee; (b) that any “percentage rent” will not substantially decline; (c) that the assumption of the lease will be subject to the all of the provisions of the lease, including provisions relating to radius, location and/or exclusivity; and (d) that the assumption thereof will not breach the provisions of any other lease, financing agreement or master agreement relating to the shopping center, nor disrupt the tenant mix in the shopping center.

If the tenant rejects the lease, it must return possession of the property to the landlord. Unlike the landlord to an assumed lease who is made whole upon assumption, the landlord to a rejected lease retains only: (a) an unsecured claim for unpaid pre-petition rent or other amounts; (b) an administrative (dollar-for-dollar) claim for unpaid post-petition rent; and (c) a rejection damages claim (unsecured) for future rent that would have been due but for the rejection. While the landlord is entitled to rejection damages, such damages are capped. Rejection damages are capped at the greater of one (1) year of rent or the rent for fifteen percent (15%), not to exceed three (3) years, of the remaining term of the lease. Rejection damages may be cut-off entirely if the landlord is able to re-lease the space for rent that will cover the claim.

Regardless of whether the tenant assumes or rejects the lease, tenants must pay post-petition rent. The bankruptcy code requires a tenant to comply with its obligations under a lease during the pendency of the case. If the tenant fails to comply with the lease terms, the landlord may have grounds for relief from the automatic stay to pursue eviction. Whether cause exists to grant relief from the automatic stay will depend on the particular circumstances of each case. For example, if the post-petition rent is not being paid, if insurance coverage does not remain in force or the property is in danger, a bankruptcy court may find cause for relief from the stay. On the other hand, if the tenant cannot continue its business without operating in the leased premises, a court may consider the property necessary for the tenant’s reorganization and be less likely to grant relief from the automatic stay. Experienced bankruptcy counsel can help assess the merits of any stay relief motion and should be consulted if the tenant fails to uphold any of its post-petition obligations under the lease.

PRE-BANKRUPTCY PLANNING: Hedging your risks when a commercial tenant files for bankruptcy

Landlords can hedge risks when a tenant files for bankruptcy by obtaining additional security to secure the lease,
which will maximize potential recovery in the event of a tenant bankruptcy.

Consider requiring a significant security deposit, including in the form of a letter of credit. Security deposits make a landlord a secured creditor to the extent of the deposit. In some cases, landlords can offset rent payments with a security deposit, which can enhance recovery to the landlord if the tenant ultimately rejects the lease.

Obtaining a third-party guaranty (from an individual or affiliate entity) of the tenant’s obligations under the lease affords a landlord with non-bankruptcy collection opportunities. In most cases, guarantors, unlike debtors, can be pursued for the full amount of the debt owing without respect to the cap on rejection damages that applies to a debtor.

In short, strong lease drafting coupled with vigilant enforcement of the landlord’s rights in and out of the bankruptcy court can make a significant difference in timely maximizing recovery from a defaulted tenant. The contents of this article are for informational purposes only and none of these materials is offered, nor should be construed, as legal advice or a legal opinion based on any specific facts or circumstances.

For More Information on what to do when a commercial tenant files for bankruptcy:

Julie M. Murphy, Esquire

Hyland Levin LLP
6000 Sagemore Drive, Suite 6301
Marlton, NJ 08053-3900
(p) 856.355.2900
(f) 856.355.2901
www.hylandlevin.com

 

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Anthony V. Mannino, Esq. Promoted to COO of WCRE

Wolf Commercial Real Estate (WCRE) is pleased to announce that Anthony V. Mannino, Esq., has been named Chief Operating Officer. Mannino has served as Vice President, Corporate Strategies since joining WCRE in October, 2015. As COO, Mannino will have a broader focus on the operations and growth strategies of the firm.

Mannino’s new role comes as WCRE has an expanding presence in the region, adding four new brokers and increasing its activity in southeastern Pennsylvania. Earlier this year, WCRE became a regional affiliate of CORFAC International, a network of independently-owned, commercial real estate brokerage firms in 47 U.S. markets and world wide.

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“Tony’s guidance within the firm will play a key role in managing our growth, especially as our CORFAC alliance opens up new business opportunities,” said Jason Wolf, Managing Principal of WCRE. “His efforts will ensure that our team continues to deliver class-leading real estate services to our clients.”

Mannino came to WCRE after nearly ten years serving as chief of staff to two members of Pennsylvania’s General Assembly. Prior to his years of public service, he was a litigation attorney in the private sector for more than a decade, practicing in Pennsylvania and New Jersey.

Like his colleagues at WCRE, Mannino has been an active supporter of many civic institutions in Philadelphia, from community associations to advocacy non-profits. He is currently a board member of the Philadelphia Regional Port Authority and the Preservation Alliance for Greater Philadelphia.

About WCRE

WCRE is a full-service commercial real estate brokerage and advisory firm specializing in office, retail, medical, industrial and investment properties in Southern New Jersey and the Philadelphia region. We provide a complete range of real estate services to commercial property owners, companies, banks, commercial loan servicers, and investors seeking the highest quality of service, proven expertise, and a total commitment to client-focused relationships. Through our intensive focus on our clients’ business goals, our commitment to the community, and our highly personal approach to client service, WCRE is creating a new culture and a higher standard. We go well beyond helping with property transactions and serve as a strategic partner invested in your long term growth and success.

Learn more about WCRE on Twitter & Instagram @WCRE1, and on Facebook at Wolf Commercial Real Estate, LLC. Visit our blog pages at www.southjerseyofficespace.com, www.southjerseyindustrialspace.com, www.southjerseymedicalspace.com, www.southjerseyretailspace.com, www.phillyofficespace.com, www.phillyindustrialspace.com, www.phillymedicalspace.com and www.phillyretailspace.com.

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Office Decommissioning – The Overlooked Cost of Moving

office decommissioningConsidering office decommissioning and relocation? Here’s a secret that no one ever tells you about moving – the bulk of your relocation costs are NOT transitioning your belongings to the new space. The fact is, office decommissioning is a significant factor in your budget, sometimes adding up to 3-5 times that of the actual relocation itself.

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All too often, clients miss the not so obvious “other move” when it comes to their office relocation. Clients split their time and attention operating their core business while also focusing on the “new” space and the endless questions, details, and decisions that are required to get that space ready to unveil. The “old” space, as well as the furniture in it, is often overlooked. If you think you can just leave the furniture and the cleaning for the landlord, you are mistaken!

The problem is that neglecting to properly decommission the old office space leaves you exposed to a wealth of unnecessary costs. The majority of commercial leases contain very specific requirements as to how the old space needs to be turned back over to the landlord. If not, it’s your deposit that hangs in the balance, just waiting to satisfy those obligations you signed off on in your original lease long ago. The removal of unwanted furniture and equipment can be an expensive undertaking, especially if not handled properly, and your landlord is well within his rights to apply your deposit to those costs.

Most commercial leases require that the occupied space be left “broom swept.” This means that all contents, freestanding furniture, workstations, office/IT equipment, shelving, racking, etc., must be completely removed, and all floors left cleared of debris and vacuumed. That also means following through on tiny details like removing any data/IT cabling that you’ve added while in residence. Overall, you need to return the space back to its original condition prior to your occupancy. Your lease should spell out the specific requirements and standards you will be held to.

office space decommissioningSo how do you protect your deposit? You need a detailed plan and a schedule! The easiest way to satisfy your lease obligations and get your deposit back is to consult a professional who is well-versed in handling the office office decommissioning process. When you partner with the right commercial removal company or transition management company, they can help you properly navigate and negotiate your exit. Most standard moving companies aren’t experienced enough to guide you through this process, and handling it yourself elevates your “soft cost exposure.” Most people over value what they have, don’t fully understand what they’re required to do, and then end up running out of time. The reality is that there is a very tight timeline when you move and the space needs to be vacated. Why wait on a potential buyer to purchase unwanted assets, when it elevates your risk of exceeding that timeline and paying a costly penalty to your former landlord? You need to understand the cost of the distraction to your core business while focusing on something that is only likely to yield a marginal return.

When you value the assets you will not be moving to your new space, factor in the time it takes to liquidate them. It’s often best to hire an expert to advocate for your bottom line, and help you sort it all out in an efficient and expeditious manner. There are three outcomes in an office decommissioning: net positive, net zero, and net negative. To achieve “net positive,” the liquidation of furniture and/or equipment yields a positive cash return and is clearly the optimal outcome to strive for. To attain “net zero,” you can choose to donate contents to a local charity for re-purpose, or have a third-party company remove them at no cost. While you don’t make any money on the transaction, you save the potential cost of having to remove the contents yourself. For those items that simply don’t have much or any value, and need to either be recycled or disposed, you’ll find yourself in a “net negative” position. Although there’s a nominal return for recycled items, the cost for disposing valueless items leaves you with a fee that an office decommissioning expert can help minimize. You don’t want to incur unnecessary storage costs for assets that won’t garner you a net positive return on that investment.

Quite frankly, there is an enormous difference between a transition management expert and a standard moving company. Before you sign with a relocation company, discuss with them the office decommissioning services that they provide. Pin down the price for the services that you need, and compare that cost with hiring various removal providers. Most commercial movers overlook office decommissioning, and this portion of the job can cost many times your relocation fee depending on how much of your existing furniture you will be taking to your new space.

Once you have the transition team in place, establish a facility decommissioning plan and lock in hard dates and deadlines. Make sure that the company is reliable, and that the personnel have the necessary skills to execute the plan. Often times, it is not worth the risk of going with the vendor with the lowest bid, as the cost for additional “buy back days” at your old space can quickly eclipse those cheap vendor savings.

So what is the takeaway from all of this? Simply that companies that focus all their time and effort on “hard costs” of relocation will be blindsided by the much more important “soft costs” of the move. A transition management expert minimizes your company’s exposure to lost revenue by reducing the distraction to your core business and curtailing downtime. Consult with an expert, and the savings on the office decommissioning will more than likely pay for the actual relocation.

argosy

ABOUT ARGOSY MANAGEMENT GROUP, LLC
Argosy Management Group (AMG) is a leader in office relocation and logistics project/move management. AMG services companies throughout the U.S. and worldwide. AMG delivers a wide range of comprehensive services: move management and transition planning, space planning and furniture needs, office and industrial relocation and liquidation, storage solutions and asset management, furniture disassembly and installation, and I.T./data center relocation.

Visit www.argosymg.com

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Retail Mall Vacancies Are No Longer Just a Class C Issue

Store closures have been the talk of the retail industry over the first five months of the year, with Sears-Kmart, JCPenney and Macy’s announcing more than 64 million square feet of combined closures since the start of 2017 and at least 10 leading in-line retailers filing for bankruptcy court reorganization or auction.

While most retail property in the commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – continues to perform well, the spate of department store closings has been largely confined to retailers’ under-performing locations, with the impact on centers that can least afford to lose them.

However, the vacancy rate also ticked up for malls in some of the strongest locations in the country, according to a recent survey by the CoStar Group research firm. The study also showed vacancy increases in power centers and specialty centers of U.S. and Philadelphia commercial real estate properties.  As a result, first-quarter retail vacancies have started to increase in certain retail segments for the first time in five years.

This CoStar report on national and Philadelphia commercial properties is being offered through Philadelphia commercial real estate broker Wolf Commercial Real Estate, a Philadelphia commercial real estate brokerage firm.

“It is not just the C malls that are suffering,” said Ryan McCullough, managing consultant at CoStar Group, “as the bulk of mall closures are in B malls, to the tune of 17 million square feet. While these store closings have been generalized as Class C mall problems, our research indicates this is not necessarily a fair representation.

“Furthermore,’ he added, “about half of this combined square footage will impact non-mall properties, including power centers, community centers, and downtown storefronts.”

The latest financial results also show malls typically classified as B properties being the first in the U.S. and Philadelphia commercial real estate markets to be experiencing declines in net operating incomes.

CoStar Group analyzed net operating income (NOI) results on more than 2,400 commercial mortgage-backed securities (CMBS)-related loans with an outstanding loan balance of $38.6 billion. In a good sign for the overall retail property segment involving national and Philadelphia commercial real estate listings, those results show the most recent NOI is up about 0.16 percentage points from the last full year reported NOI.

However, one segment of the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – saw a decline in NOI: Retail properties with outstanding loan balances of $50 million to $100 million saw NOI decline by 0.05 percentage points.

The NOI analysis of CMBS-related loans among the U.S. and Philadelphia commercial real estate listings also found about 42 percent of properties had an improved debt service coverage ratio (DSCR), or the amount of money left to cover required monthly debt and principal repayments. These retail properties posted strong DSCRs, improving their ratios by about 25 percent. Only about 4 percent of these properties were in the $50 million to $100 million loan balance category.

For more information about Philly office space, Philly retail space and Philly industrial space or other Philadelphia commercial properties, please call 215-799-6900 to speak with Jason Wolf (jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a leading Philadelphia commercial real estate broker that specializes in Philly office space, Philly retail space and Philly industrial space.

Wolf Commercial Real Estate, a full-service CORFAC International brokerage and advisory firm, is a premier Philadelphia commercial real estate brokerage firm that provides a full range of Philadelphia commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other Philadelphia commercial properties for buyers, tenants, investors and sellers.

Wolf Commercial Real Estate, a Philadelphia commercial real estate broker with expertise in Philadelphia commercial real estate listings, provides unparalleled expertise in matching companies and individuals seeking new Philly office space, Philly retail space or Philly industrial space with the Philadelphia commercial properties that best meets their needs.

As experts in Philadelphia commercial real estate listings and services, the team at our Philadelphia commercial real estate brokerage firm provides ongoing detailed information about Philadelphia commercial properties to our clients and prospects to help them achieve their real estate goals.  If you are looking for Philly office space, Philly retail space or Philly industrial space for sale or lease, Wolf Commercial Real Estate is the Philadelphia commercial real estate broker you need — a strategic partner who is fully invested in your long-term growth and success.

Please visit our websites for a full listing of South Jersey and Philadelphia commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

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