The Validator: Cushman & Wakefield’s Global Consulting Group Head Finds Himself Very Busy
Jotham Sederstrom Aug. 9, 2010, 8:41 p.m.
It was only two years ago that Edward Donnery first realized that the global consulting group he heads at Cushman & Wakefield had grown from being an infrequent tool, used sparingly in the execution of the firm’s most important assignments, to something far more integral-like a scalpel, for instance.
Indeed, it was sometime in 2008 that the commercial real estate veteran and his top colleagues were first presented with a pair of disparate clients who couldn’t have been further apart, both in terms of scale and their competing real estate requirements.
One, a well-known financial services firm seeking headquarters space, was typical fare for the consulting group. The other, a not-for-profit housing advocacy group, had far more modest ambitions to occupy a 1,000-square-foot headquarters space. Until then, the global consulting group had rarely been called upon to analyze the needs of such a comparatively small client.
“The point was that even for the small requirement, the client was equally as focused,” Mr. Donnery, a senior managing director, recalled. “That kind of set a stage where we realized that it doesn’t matter what the square footage or the costs are. When you’re talking to any particular client, those decisions are equally as important, no matter what the magnitude. What we learned was that they all required the same kind of scrutiny and dedication.”
The epiphany goes a long way in describing how, in the span of a few short years, the group’s workload has grown from a dozen or so marquee clients to a rather staggering juggling act that currently includes more than 20 or so pending deals totaling 3 million square feet, according to Mr. Donnery.
“More and more brokers are using us, so it’s definitely catching on,” added Maureen Kelly, a managing director of the consulting group who, along with Mr. Donnery and partner Jon Herman, oversees an estimated 20 associates.
Unlike the brokers who initially scout and foster relationships with potential clients, the consulting group typically enters the fold after an agent requests their services. And, like a scalpel, their ability to carve out an incisive cost-and-growth analysis for clients is what keeps brokers knocking at their door. In other words, the group’s particular skill set has become indispensable.
“Sometimes they come in with some preconceived ideas and we’re there to validate it, to say, ‘You’re right,’ or to say, ‘No, what you’re thinking is not the best decision as a business for your real estate needs,'” said Ms. Kelly, who in April advised the M.T.A. in its 110,000-square-foot lease agreement for office space at 333 West 34th Street. “We’re there to move the transaction along, but also to say, ‘Hey, your idea is right,’ or, ‘No, it’s absolutely wrong.'”
“We’re in the validation business,” Mr. Donnery chimed in during a chat last week with The Commercial Observer.
Among the estimated 2.2 million square feet in office space the group has, ahem, validated since January, Mr. Herman pointed to a transaction on behalf of the National Football League, which last month inked a big deal for 175,000 square feet at Rudin Management’s 345 Park Avenue. Cushman brokers Franklin Speyer and Lou D’Avanzo spearheaded the deal.
After consulting with the group, NFL executives made a decision to move two blocks from its space at 280 Park Avenue after being advised that their long-term real estate needs would be better served in a more efficient, cost-friendly office space, Mr. Herman said.
“The NFL had been at their current building for about 15 years,” said Mr. Herman, a managing director. “They were happy there, but they had a lease expiration coming up and they wanted to see what was available. In doing so, we went in, evaluated what they really needed and eventually settled on one that offered increased efficiency and a financial benefit that, compared with their other options, was compelling.”
Another deal in February involved the publication Reader’s Digest, which last year filed for Chapter 11 bankruptcy protection. Previously the occupant of 287,000 square feet at a big corporate campus in Chappaqua and a 55,000-square-foot space in Manhattan, the media conglomerate chose to consolidate its offices into spots in White Plains and at 750 Third Avenue. Cushman brokers Mitch Konsker and Matt Astrachan initiated the deal.
“They really were looking for us to advise them,” added Mr. Donnery, who joined the global consulting group in its infancy some 10 years ago. “They obviously had bankruptcy counsel, but, from a real estate perspective, we really advised them on what it means to reject a lease and be able to walk away from an ongoing obligation, and how best to use that type of leverage for an eventual emergence strategy.”
THE GROUP WAS established in 1999 under the stewardship of Dennis Irvin and Bruce Mosler, Cushman’s former chief executive and current co-chairman, who, at the time, acted as president of U.S. operations at the firm. Mr. Donnery, a Brooklyn native who previously worked at Deutsche Bank, joined the group shortly after and quickly helped expand it from what he described as a financial and analytical arm to a division far more focused on advisory services and workplace strategy implementation.
It was under his stewardship that the group began working more closely with the brokers. To hear it from Mr. Donnery, the change has not only had a positive effect on the deals, but the ties that bind them to their brokers.
“One of the best parts about our job is that we deal with a variety of different industries and we’re dealing with the leaders of these different companies, and it’s really insightful, rewarding and fun to deal with those decision makers,” he said.
“And then the brokers we team up with have varied personalities,” Mr. Donnery added, “and when you’re hand-in-hand with them, working on deals, you really get to understand their intellect and their creativity, and you don’t always get to see that until you’re rubbing elbows with them.
“It’s incredibly rewarding.”