Savills’ Tom Fulcher on Being an Office Salesman in Post-Pandemic Times
Tom Fulcher is moving up in the D.C. world.
Earlier this year, Savills promoted the veteran broker to region lead of the firm’s mid-Atlantic offices and director of its Washington, D.C., office. He succeeded David Lipson, who was promoted to president of Savills in April.
In his new position, Fulcher is part of the firm’s management board and involved with strategic planning for the D.C. region.
As part of the Savills team since 1986, Fulcher has been co-regional manager of the Washington, D.C., region since 1998, giving him a keen understanding of what clients are looking for in office space. As the world emerges from the pandemic, at one of the most challenging times for office real estate, that insight has never been more important.
Fulcher recently sat down with Commercial Observer to talk about what he’s seeing in the market.
Commercial Observer: You’ve recently been named as leader of the Washington, D.C., region. What were some of the goals you set when stepping into this role?
Tom Fulcher: As a firm, we’re really working on expanding our platform. We purchased Macro [Consultants], a project management firm, last year, and we just purchased T3 [Advisors] up in Boston, an advisory firm which will help us expand in life sciences. We have some announcements coming out about people in workplaces that we’re picking up. We’re really focused on serving our clients better.
Locally, there’s some blocking and tackling that we’re doing — taking a look at how well we’re covering the market, who’s doing what, who we’re in front of, who are we not in front of. And then, obviously, a big part of our world in management in recruiting and retention.
The pandemic, obviously, changed the thinking of many concerning office space. How does this new way of thinking play into your strategy going forward?
One of the things that’s maybe a little bit of a trap for people in our business is to sort of say, ‘go office space,’ but I don’t want to be caught the position of the buggy whip salesman, saying, ‘go horses, go carriages,’ because that’s not really where our clients are. We need to live that experience with them and really help them try to understand along with them what’s working best. Do you actually need to come in? If you don’t, then we’re not going to say office space is the thing for you. We’re going to help people understand how to serve their clients and businesses the best. The end result, most likely, is there will be a lot less people using office space.
There are still certain sectors that really still continue to believe that being in an office leads to better communication of competence and culture, but I think a lot of others are saying a lot of these jobs didn’t really require us to talk to each other all that much, and we can be wherever we can be and that’s okay. Let’s live with that.
How would you characterize what you’re seeing today?
A month ago, we were feeling a lot of energy picking up, but the summer has hit us and things are slowing down a little bit. I think Labor Day is going to be the time most people are focused on coming back, if they are coming back. That’s when they will try to figure out what will make sense to them.
The market seems to be picking up steam. What are the trends you are seeing?
What we are seeing is that a lot of people have decided nationally to take back the sublease space they had on the market. I think that’s happening all over the place.
We are hearing from some folks in our office that people want things ASAP — it’s got to be built out, it’s got to be wired — and some are realizing they can’t function without being together. So, I see an increased energy in the market, reduced a little by the summer doldrums, but I think Labor Day will come along and we will get a real sense of where things are.
Once Labor Day does hit, there will probably still be some uncertainty. How do you prepare a strategy for that?
I don’t think anyone has the answer as we sit here in July. What we’re hearing from our clients — and for us, too — is you have to try something. Either, let’s not come into the office at all [or] let’s get everyone in the office, and those conversations are happening. The thing we’re seeing is people wanting to come in Tuesdays, Wednesdays and Thursdays. So, Friday’s going to start to look like summertime in terms of traffic, and I know restaurants are really concerned about that because the longer lunches and happy hours are on Fridays. That might be diminishing.
Does the state of things give tenants or landlords the upper hand?
There’s a developer who made a comment recently that, for them, once every 10 years is where they get the advantage. I think that’s not going to for a while in the Washington area. It’s been a tenant’s market for a long time, which has resulted in high vacancy rates, lots of options, increased concessions, the amenity wars — and I think all that’s just going to continue to happen. It’s not going to become a landlord-friendly market for a while.
Pre-pandemic, flexible work spaces were pretty popular. Do you think that trend will continue?
The restaurants are starting to fill pretty fast. I went to a live concert a week ago. It feels like we’re getting back to normal pretty quickly. For the most part, flexible office has an important role and I think the pandemic helped that.
You also serve as the firm’s legal tenant practice group leader. What are you seeing in terms of law firm demand in the region?
If there’s anybody that’s looking to go back to the office more than anyone else, it’s probably the law firms. If you think about why a client hires a big-name firm, it’s because those people are good, and the people before them were good and they trained them, so they’re quality people and that’s why I’m hiring that name. And if you don’t have people together, I think people are feeling like, “Are we going to be able to communicate that competence as effectively?” Also, with the competitiveness of firms, the office space and being together in that culture, a lot of times, it’s the glue that holds the firm together.