How Influencer Marketing Saved a 40-Story Manhattan Office Skyscraper

Since the late 1980’s, we’ve been consistently using the same strategy and it has seen us survive and thrive through three major real estate cycles, as well as flourish during the good times.  In the last decade alone, we’ve significantly outperformed our competitors in Tampa Bay in terms of vacancy rates in our office buildings. With a large portfolio that’s about 95% leased, we’ve outstripped the vacancy factor in the broader market year over year because of our unique leasing strategy.

But what kind of marketing strategy works well in major downtown office building ownership and management?

In this article, we will take a look at an event that taught us the importance of ‘influencer marketing’ before the internet had even emerged, and how it came to serve as foundational case study in effective office building marketing.

Narrowing Your Focus

With any leasing project, you first need to understand who you’re marketing to. What group of people will give you the biggest ROI for your marketing budget? How can you get your marketing materials in front of the right people? It all starts with narrowing your focus to a more exact group of people and cutting out wasteful, broad marketing practices that don’t provide the right returns.

You don’t need to market to everybody; only to the right people. Market to the people who will be bringing you business. Define your target market very specifically to avoid wasting your time and money broadcasting to uninterested people.

In the early 90s, when Feldman Equities’ current CEO, Larry Feldman, was put in charge of his first major project – a 40-story ground up office building tower in midtown Manhattan – by his father, the New York economy was in bad shape. At the opening of the building, it was only 6% pre-leased and the building was being delivered in the middle of the savings and loan crisis.

Feldman’s marketing company at the time insisted that he post full-page ads in the New York Times, the Wall Street Journal, and other widespread, prestigious publications for $50,000 – $100,000 each. For Feldman, the cost couldn’t be justified, because the readership for those publications was for too broad. Everyone from casual shoppers to CEOs might see the ad, but they weren’t likely to convert into tenants.  

Instead, he and his team narrowed their focus to market to.  They decided to focus exclusively on 200 – 300 office building real estate lease brokers based in Manhattan. About 90 – 95% of all the leases they had signed on previous projects had been accomplished through these leasing brokers, so the plan was to target them specifically and to encourage them to bring their business to the new building. These 200 – 300 brokers were the dominant dealmakers in New York City and with this narrowed focus, the marketing team were tasked with reaching out to office leasing brokers in a highly targeted campaign.

Standing Out

If marketing is about getting the right people’s attention, the tricky part is what to do once you know who you’re targeting. Creativity and out-of-the-box thinking come in handy, as long as your ideas can be reined in to become something executable.

More creative tactics that Feldman has executed include mailing out live tree seedlings on Earth Day to every real estate broker in New York involved in office leasing. Although the seedlings were fairly expensive at $10 each, Feldman only needed to mail these out to 300 brokers, so the total cost was only about $3,000.  The seedling idea went “viral” when the NY Times wrote an article about Feldman’s creative marketing technique. Years later, brokers reported that their seedlings have become tall trees at their homes in the suburbs.

Both activities were part of the year-long marketing push for the 40-story office building. By the end of the year, the building went from 6% leased to 88% leased, despite being in the middle of one of the deepest recessions in the US real estate industry for decades.

It isn’t enough to go with the status quo and stick to the usual tactics employed by every other developer in your area. If you want to stand out, you must take some risks and put in the legwork. Sometimes, it’s as simple as showing up at a broker’s office instead of throwing the typical broker party at your office building and expecting them to travel to you. Other times, it might involve sending out gifts and making regular follow-up phone calls. That Feldman equities, we do this almost every month. It always takes a constant effort on your part to stay in your target market’s line of sight.

For Feldman Equities specifically, the playbook hasn’t changed much since then. Today, we might send out wireless earbuds with taglines like “Have you heard there’s a new owner at XYZ building?”. The gifts themselves, the technology behind the outreach efforts, and other minor details have to evolve to keep pace with what’s happening in the world, but the underlying strategy is still effective to this day.

Marketing Is Constant

If you push your marketing continuously for 6 months, your lease rates will likely reflect that positively. But what happens when you’re satisfied with your current leasing rates and you stop pushing? We have found that numbers may remain positive for a lag period, but that they will inevitably go down again. You can’t treat marketing as a reactionary response to low leasing. It needs to be ongoing and constant if you want to continually experience the benefits.

The theory of marketing is that it must be consistent, persistence, adapt as circumstances change, and be ever-increasing. You can’t just increase your marketing budget when you have a drop off in leasing. This kind of flash-in-the-pan marketing always ends with an uptick of activity, followed by a crash. Instead, you have you to be constantly marketing and maintaining your presence in the market.

Marketing requires a relatively high budget, but it’s an investment that makes a difference to the bottom line and sets one operator and one building apart from the competition in a crowded market. During recessions, we actually leave and increasing our marketing budgets. We never scrimp on the cost of marketing.

With office buildings, as with many other sectors of commercial real estate, leasing rates and vacancies drive the value and long-term sustainability of a property. Marketing is how we keep leasing rates high and prevent long periods of high vacancy – and the best way to effectively market a downtown office building is to focus on the most influential of actors; the leasing brokers.