High-tech perks can keep building's tenants happy


POSTED: Sunday, October 11, 2009

As anyone in business knows, broadband is no longer a luxury — it's an absolute necessity. In Hawaii, where real estate represents a huge source of revenue for everyone from families to REITs (real estate investment trusts), bandwidth is just as important a component of a building as parking or plumbing.

So what kinds of options does a building owner have when it comes to setting up Internet services?

Don Mangiarelli, systems manager for Pacific Office Properties, which owns seven buildings in Honolulu, says a building owner can negotiate either directly with a carrier to provide phone, Internet and e-mail services, or hire a third-party networking company to provide the same services as well as advanced applications such as Voice Over Internet, off-site backup, VPN, access to cloud computing, etc.

There are a number of experienced third-party networking companies in town such as Century Computing and Systemmetrics, which can both provide infrastructure upgrades, such as an Ethernet network, in a building as well as a variety of Internet and telecom applications.

Rick Marine, a founder of Century Computing, says the key for building owners is to understand what their tenants need and what, if anything, the building will require in the way of upgrades. The owner also has to be clear about his expectations. Does he plan to make Internet services a possible profit center, or will he offer it as a value-added service?

Both Earl Ford, founder of Systemmetrics, and Marine say that if a building has enough potential customers, their company may be willing to do the entire upgrade at no cost to the owner in exchange for the future revenue generated by the tenants.

If a building owner is willing to pay for an upgrade, he might be able to turn bandwidth revenue into a potential profit center. However, there may be a price to pay. Tenants might not want to feel like they are “;nickel and dimed”; for every service.

Mangiarelli thinks that giving his tenants at Pacific Properties discounted Internet services is the best way to go.

“;Our philosophy,”; says Mangiarelli, “;is to guarantee low telecom costs and use bandwidth as a perk.”;

By making their lives easier, Mangiarelli reckons he's going to engender loyalty from tenants.

Both Ford and Marine agree.

In the long run, a landlord can add more value by outfitting an office with phone, Web access, e-mail and other services in one package rather than burdening a tenant with ever more vendors.


Cliff Miyake, general manager in Honolulu for Time Warner Telecom, can be reached at .(JavaScript must be enabled to view this email address).