Battle-tested in Detroit – considered the nation’s toughest commercial real estate market by the Urban Land Institute — Friedman Integrated Real Estate Solutions now is focusing its unique expertise on Arizona’s challenged markets.
“We’ve got a pretty long-standing record of turning around distressed assets,” said company President & CEO David Friedman, whose full-service firm brings 27 years of real estate expertise to Phoenix, Tucson and other markets. “We sort of have a secret sauce. We know what we have to do when we take over a property.”
During the past five years — some of the worst in the sales and leasing market in recent memory – Friedman professionals have honed their skills in Michigan and elsewhere. While the Detroit area has seen a vast improvement, ULI still ranks it 51st out of 51 office markets, according the group’s 2014 Emerging Trends in Real Estate report.
“Michigan has been in distress long before the rest of the country,” said company Vice President Scott Shefman. “We’ve made it a positive here – we had no choice.”
Survival in such a climate ingrained a valuable lesson in company professionals.
“What I’ve learned is: Real estate is real estate,” Friedman said. “You can turn things around pretty easily to make money in all different sorts of markets.
“(And) you don’t have to spend a lot of money on things to make a big difference. Anybody can spend a lot of money. All the properties we’ve redone in Michigan have turned around drastically. It’s because of decisions we made and how we spent the money.”
Getting an office building in shape for leasing or sale can be as simple as removing trees that impair visibility, restriping a tired parking lot or installing upgraded flooring in a lobby for a fresh look, Friedman said.
When a bank seizes a property, the first step is to calm distressed tenants, he said. That has to happen quickly.
“We’ve got sort of a SWAT team we bring in,” Friedman said. “In 24 hours, we’re on top of the problem.”
The Friedman team meets with existing and prospective tenants and contacts local brokers to get space filled.
“We are able to settle things down and really turn around a property pretty quickly,” Friedman said.
The secret to the firm’s speed is it can plan everything from within the four walls of its shop — leasing, management, construction, Shefman said.
“We’re a one-stop shop,” he said. “It saves (clients) time and money.”
Despite ULI’s low ranking for the Detroit market, it’s farther along the comeback trail than most, Shefman said.
“We’re probably in the sixth or seventh inning in the recessionary cycle in Michigan and maybe in the fifth inning in other markets,” he said.
Arizona’s markets, however, need help to turn around, which is why Friedman is focusing on them.
“We follow the trouble,” Friedman said.
The company already has seen success in Arizona markets, said David Gimple, a Friedman leasing manager who handles assets in the Phoenix and Tucson markets. The company has taken properties from 35 percent leased to 100 percent leased in a matter of months, he said.
“Not being entrenched in the Tucson and Scottsdale market has given us the ability to think outside the box,” he said.
When a Walmart anchor left a center in Sierra Vista, the company was able to leverage national relationships to fill up that dark space, he said.
Included in Friedman’s Arizona portfolio are Acacia Creek in Scottsdale, Vista Commons in Phoenix, Tri Pointe Plaza in Tucson and others.
LNR Property LLC, a diversified real estate investment, finance, management and development company, has counted on Friedman for 20 years.
“Friedman is my most-trusted provider and also adds significant value through its soup-to-nuts, in-house capacities. It’s the only group I’m aware of that can manage and sell multifamily properties. Being able to have leasing and construction done in house is also very unique.” proclaims, John Mitchell Vice President/REO Asset Manager LNR Partners, LLC.