Yesterday’s Wall Street Journal featured an in-depth look into the internet infrastructure difficulties plaguing New York City commercial real estate, and as the only rating system which evaluates office buildings for the quality and reliability of Internet connections, WiredScore was thrilled to play a part in highlighting this critical issue. Today, it’s a given in New York City (and in many other cities) that many startup and tech companies prefer older loft buildings with character in more livable office neighborhoods, where they offer millennial workers must-have amenities like kegs, coffee bars and Ping-Pong tables.
But as the Wall Street Journal explains, finding all that in a building with robust Internet options can be tricky to pull off.
Internet infrastructure and connectivity can vary widely from building to building, especially in the unconventional neighborhoods populated with the hip loft spaces coveted by creative firms.
“You can’t tell from a pretty lobby or trust somebody’s pitch about the building, no matter how earnest that pitch might be,” said Arie Barendrecht, CEO and co-founder of WiredScore, “There are lots of challenges and variation in connectivity, and not all are obvious.”
Startup PhotoShelter, which offers a digital-archival and management system for large users of photography, knows this all too well. Several years ago, the young tech company waited 18 months for an Internet-service provider to install a fiber-optic connection. And while the city’s modern skyscrapers typically have the high-speed connections PhotoShelter needs, “tech businesses like ours generally don’t want to be in those buildings,” said PhotoShelter’s CEO Jeffrey Arnold, whose staff generally resides in Brooklyn and the Lower East Side. “One of the things we use to hire is the quirkiness of the building.”
To be sure, brokers now routinely ask about the quality of a building’s Internet connections. And many of the city’s leading landlords have upgraded their buildings to meet tenant's Internet connectivity needs, with many pursuing Wired Certification in order to highlight their rating to set them apart from competitors.
The landmarked Empire State Building has a Platinum-level Wired Certification rating—the highest level, for its Internet capacity and infrastructure. Completed in 1931, the skyscraper has attracted heavyweight tech tenants such as media company Shutterstock Inc. and social-media giant LinkedIn Corp.
“We use all of these different attributes, so tenants have a choice,” said Anthony Malkin, chief executive of Empire State Realty Trust Inc., owner of the Empire State Building. “If you only have one service provider, your tenant could be held hostage.”
One of New York's most well-known real estate brokers, Mary Ann Tighe, chief executive of the New York tri-state region for CBRE Group Inc., a real-estate-services firm agrees that tenant demand is what is driving the shift towards better connected buildings, “That’s how you penetrate the consciousness of owners, because they begin to realize it’s a factor in the decision-making process,” she said.
Caspi Development Co. knew reliable Internet service would be important in luring the tenants it wanted for the revamped, seven-story 161 Bowery building it bought and renovated last year. Mounted on a wall in the lobby is a Wired Certification plaque, along with a street-level roll gate painted by a graffiti artist, and elsewhere are kitchenettes with beer taps.
The company consulted with WiredScore on what it would take to achieve a high Wired Certification ranking for the property. Not long after the renovations were completed last fall, Caspi signed leases with several new tenants, including tech company Kik Interactive Inc.
“The rating system is definitely a vital piece of leasing agents’ ability to market a building and gain business,” said principal Joshua Caspi. “I don’t think [new tenants] would have come to the building without the fiber.”
Read the full story: The Wall Street Journal