Bob Welanetz reaches into his jacket and pulls out an old magazine subscription card. "I carry around this thing," he says, turning the card over to read some words scribbled on the back. "It's a quote from Thomas Jefferson. He once said, 'I'm a great believer in luck. I find that the harder I work, the more I have of it.'"
If that's the case, Welanetz ought to be storing up plenty of luck. As president and CEO of Jones Lang LaSalle Retail/Americas, the 46-year-old amateur hockey player is known for pushing himself and his staff beyond everyday expectations.
"I try to set the tone in this organization to encourage people working with us at all levels, both in the office and in the field, to be creative and progressive," Welanetz says. "It's good to be smart about what you do. But you also need to push yourself into areas where you might not feel comfortable. Somehow, no matter what you're trying to accomplish, you'll choose a route that's going to work well."
Welanetz's Atlanta-based division is the North and South American retail headquarters of one of the largest real estate and investment companies in the world. Created by the March 1999 merger of Chicago-based LaSalle Partners and London-based Jones Lang Wootton, Jones Lang LaSalle now operates in 97 markets across 33 countries on five continents. The massive firm manages a real estate portfolio of 700 million sq. ft. and employs 6,500 real estate professionals. Its investment management arm alone handles more than $20.5 billion in total funds.
Telling the story With 58 regional malls and other retail properties under management in the Americas, JLL is already a major player in the industry. But even some industry insiders aren't exactly sure what the office does, given the complex series of mergers that led to JLL. Welanetz says one executive in the retail division collected his business cards from the past two years and had them framed. There were six in all.
The JLL retail team, which provides a growing list of third-party real estate services, is eager to tell its story. "When we visit clients, the first thing we do is explain who we are and what we do. They're amazed at our size, the number of properties we have, and the number of people we have as our clients and in our organization," says Greg Maloney, director of management and business development. "Getting that name out there and telling people what we do is extremely important because we are a new entity in a lot of people's minds."
New company, familiar faces JLL may be making a name for itself, but its retail team is well-known in the shopping center industry. Key officers, many of whom have been friends for years, share decades of experience at top firms. Some focus on development, leasing, property management or marketing; others are experts in tenant coordination, market research, strategic consulting or construction management.
"It's really an amalgamation of people from Hahn, Homart, Rouse, Taubman, Urban. It runs the gamut, and that's positive because we're not all of a singular mindset," says David Hull, director of leasing. "From a retail perspective, that common background and collective knowledge is really helpful."
Approximately 75 people work in the Atlanta office, with about 1,000 others in property offices throughout North and South America. Welanetz is responsible for setting the group's overall direction. He previously served in leadership positions with Lend Lease Retail, Yarmouth Group Property Management Inc., The Hahn Co., and Pan Pacific Development.
He says the merger, by combining the international portfolio of Jones Lang Wootton with the North American presence of LaSalle Partners, resulted in the world's most extensive retail network. The new company can help clients move from domestic to international markets with ease. "Everybody is trying to select certain markets to expand into," he explains. "But Jones Lang LaSalle already has retail resources all over the world."
Pushing the boundaries Although management and leasing make up the Atlanta office's core domestic business, JLL Retail/Americas has a broader vision. "Most shopping center companies in the U.S. have been forged from development backgrounds with an ownership orientation, but we're doing our work for third-party or direct investors," Welanetz explains.
"We're not just attending to ownership needs - managing, leasing, redeveloping or marketing properties - we're also servicing the retailers. We're taking the skills that have been developed in the management and leasing arena and expanding them to diversify our lines of service."
Welanetz says the retail division constantly explores new ways to help its clients prosper. JLL places particular emphasis on research, technology and strategic relationships. For example, the firm recently adopted two high-tech research tools designed to help retailers improve performance. The first, SalesTrak, is a computer program that enables users to quickly identify sales trends at their centers. The second, MaxTrak, is a hand-held computer that instantly gathers and analyzes data on customer opinion.
"We just had a case in Tallahassee Mall in Florida where we were using SalesTrak to monitor the daily sales of a fast-food merchant. In two weeks, we knew that they weren't performing up to their category," says Laura Howard, consumermarketing director. "Instead of waiting for them to come to us in a couple of months - where they might already be talking about rent relief - we were able to go to them first and change the situation."
Keeping an open mind In the fast-moving shopping center industry, staying ahead of trends can mean the difference between success and failure. Welanetz says openness to change is an integral part of JLL's approach. For example, non-traditional retail is a growing segment of JLL's business, whether in office buildings or urban redevelopments. Among other projects, the firm has earned praise for its redevelopment of transit centers such as Union Station in Washington, D.C., and Grand Central Terminal in New York City.
JLL also is developing on-campus retail at colleges and universities such as the University of Pennsylvania and Georgia Tech. The firm sees great potential for retail developments in traditionally non-retail areas.
JLL's overall strategy is to provide any service a client could want, from repositioning a sluggish mall to finding the best site for a new one. As a result, the retail team must consider every potential opportunity. Welanetz, for example, refuses to take a defensive stand on technology. He notes that the Internet already is helping owners, retailers and service providers communicate better.
Focused on the future JLL's retail management portfolio in North and South America now encompasses about 41 million sq. ft. As a leasing expert, Hull has spent much of his time (both before and after the merger) orchestrating major mall repositionings. At Tallahassee Mall, for example, repositioning boosted occupancy from less than 50% to more than 90% and raised sales from $186 to $270 per sq. ft. Total property value increased by more than 65%.
A similar transformation was achieved at Southgate Plaza, a 430,000 sq. ft. retail center in Sarasota, Fla. "It was originally anchored by a Publix supermarket, but we were able to negotiate the surrender of that lease and add a Saks Fifth Avenue," Hull says. "We completely remerchandised about 80% of the existing GLA with popular, in-demand cachet retailers."
Other repositioned properties include Fashion Square in Sherman Oaks, Calif., Glendale Mall in Indianapolis, and Plaza Carolina in Carolina, Puerto Rico. JLL recently added a parking deck and 20-screen theater to Plaza Carolina, which ranks among the firm's most successful properties.
"Retail sales are booming in Puerto Rico," says Maloney, who oversees property management at Plaza Carolina. "We're looking to expand our presence there."
JLL also is working to expand its array of services, particularly tenant representation and retail consulting. The retail division landed a high-profile consulting contract in December.
"We're working with McDonald's Corp. in the recent purchase of Boston Market," Maloney says. "We'll be doing due diligence for McDonald's, including environmental, ADA compliance and property condition assessment. We'll also be working on their behalf as a consultant to negotiate the majority of the 751 Boston Market leases across the country."
Heading into 1999, JLL had hoped to gain four new property assignments during the course of the year. The firm met that goal - and then some. "In 1999, we'll have won about 15 new assignments," Welanetz says. "For a company that's less than a year old, we're very pleased."
Management Portfolio (Dec. '99) 58 properties, 41 million sq. ft.
Retail Property Types Regional malls, specialty centers, transportation centers, power centers, community centers, colleges and universities, urban, mixed-use.