Sabesan, Selig Join Cresa to Head NYC Tenant Advisory Business
By Diana Bell
National commercial real estate services firm Cresa is expanding in the New York City market, hiring industry professionals Peter Sabesan and Richard Selig as managing principals. The two are tasked with building out its tenant representation team.
Sabesan and Selig tell CoStar News they will be hiring all levels of brokers - from junior to mid-level and senior - who can stand on their own with their own book of business but may be tired of the politics, and want to join a collaborative team.
Sabesan and Selig each bring 30 years' experience to Cresa, having co-founded Hunter Realty Organization in 1997. In 2010, Hunter acquired Coldwell Banker Commercial's New York City franchise, building it into one of the company's top-performing offices across the country.
"Eventually [we] sold that to a hedge fund," says Sabesan. "We left in April and shopped around."
Cresa focuses on tenant advisory for office occupiers, a strategy which the men say attracted them to the company.
"It is not going to matter to Cresa whether the tenant moves or takes a shorter lease. We view ourselves as advisors, as opposed to thinking more like traditional brokers. We are the extra eyeballs on each deal. Most brokers don't understand the value of project management. We take a peak under the hood and analyze the deal," explains Sabesan.
"We are looking to do what's best for the tenant and to do repeat business. We are not dialing for dollars," adds Selig.
Looking Ahead at the Changing Office Markets
With a softer office market, landlords are investing in their buildings as a wave of capital improvement projects is moving across commercial real estate. Although that has partly to do with staying competitive to a new workforce, it's also a function of the current cost of capital, according to sources at Ariel Property Advisors. Currently, it's cheaper for landlords to invest into their own properties than to refinance or to acquire new assets.
Tenants, meanwhile, can afford to be pickier.
"Early renegotiation of a lease is possible, for example, when a building's mortgage is coming due; or depending upon what the tenant is paying, we might recommend a blend-and-extend to take advantage of market conditions," advises Selig.
Sabesan and Selig are keeping an eye on how supply fundamentals and tenancy trends will shape the market in the years ahead.
In Midtown West, for instance, work at Hudson Yards has helped push office rents into the triple digits, and they contend the Midtown East submarket will become a less expensive alternative.
Meanwhile, Sabesan and Selig predict that office design for Millennials is a trend that will keep growing in the next five years. This cohort is changing office real estate, they note, estimating that existing office stock is currently 70 percent traditional and 30 percent millennial.
"Millennials want to park their bike somewhere, they want a place for a lounge, ping pong tables. Millennials do not do traditional office, they want open collaborative space. Even kitchens are wider," says Sabesan.