Property Owners Boast of Conference Space to Gain Tenants in Baltimore

Feb. 20–In recent years, commercial property owners have had to dangle new amenities in front of prospective tenants to gain an edge in an increasingly competitive office space market.

It might be parking, a lobby restaurant, or a fitness center.

For David W. Kornblatt, that something extra is nothing new, because he was one of the first in Baltimore to build a conference center with a spectacular vista for tenants, in his 28-story St. Paul Plaza office tower, in 1989.

Now Kornblatt hopes to take his venture a step further by promoting his meeting rooms with a view to outside groups and meetings.

Kornblatt is not alone. Just up the street, other office buildings provide similar conference space to tenants, and in some cases, are opening their meeting rooms to the public.

Providing such space saves tenants money by avoiding the need to replicate a conference area within their own leased space for occasional use.

“I did a lot of traveling around the country, and I saw them in other cities and they worked quite well,” Kornblatt said. “It effectively allows a tenant to take less space that they have to pay for. It’s included in the rent. We felt it would be an asset to the building.”

J. Paul Beitler, president of The Beitler Company of Chicago, who has developed more than 10 million square-feet of class A office space in Chicago, said the trend of adding amenities to office buildings began 15 years ago and is seeing a resurgence as vacancy rates have risen.

Perks like car washing, concierge and delivery services and media/conference centers multiplied — only to disappear once space in buildings filled up, he said.

“Landlords are now facing vacancy issues, and they’re back to the drawing board to try to find a point of differentiation,” said Beitler, who projects include developing the Hyatt corporate world headquarters. “I expect in Baltimore you’ll see more and more of these amenities returning to buildings because they have to. The rent per square foot is no longer the sole factor that causes a company to relocate.”

Kornblatt first saw the conference center idea in a building in Chicago in 1971, he said.

Today his office tower conference center is among a few of its kind in Baltimore. And in a business climate where there is a surplus of available office space downtown, he thinks it offers him a competitive advantage.

“The other new buildings are copying us,” Kornblatt said. “Some of the buildings that have copied off us don’t have the same big space and the vista.”

After spending $200,000 on a face-lift to the space and upgrade to the 900-car parking garage of his office tower at St. Paul and Lexington streets, Kornblatt is marketing his venture to a broader audience.

The building’s 4,000-square-feet of meeting space can be divided into five rooms and has the flexibility to handle a roundtable discussion for five or a presentation for 120. Floor to ceiling windows and a spectacular view of the downtown skyline from the 22nd floor, combine with the latest drop-down projection screen and other technology.

“Most people say, ‘Oh my gosh, what a great view,” said Elizabeth V. Kerr, conference center coordinator. “And then they say, ‘I never knew it was here.’ That’s because it was never marketed to anybody. It was supposed to be a benefit of this building. My goal is just to get people to walk through the space, because it speaks for itself.”

Kerr hopes to book the space at least four full days a week and some weekends too. She also hopes people will think of the space when it comes to weddings, family reunions, corporate parties and weekend seminars.

Part of the reason for Kornblatt’s timing on the renovation is that the nearby Tremont hotels will open meeting space soon, he said.

Expected to open in late 2005, in the former Grand Lodge of Maryland Masonic Temple, the hotel company’s plans are for 30,000-square-feet of banquet and meeting space. The renovation of the 1907 building, at a cost of $16 million, will be called the Tremont Grand.

“We think downtown needs more space for both meetings, conferences and social events,” said Michael D. Elliott, director of sales and marketing for Baltimore’s Tremonts.

Another building with conference space available for its tenants and the public to rent is 100 E. Pratt, which is owned and managed by Boston Properties. That meeting area, which opened in 1991, features more than 2,000-square-feet of space in three different-sized conference rooms on the 12th floor.

Nearby, at 36 S. Church Street, Manekin LLC offers a three-room conference facility on the second floor of its building. That conference space, expanded parking and a renovated lobby were completed at a cost of $3 million in 2002 — along with another popular feature that Beitler says is on the rise — a fitness center.

Primarily for use by the people in the building, the main conference room seats 20 people, with room for 75-100 in another room and a small conference room with seating for eight to 10. Tenants’ use of the space in Charles Center South is included in their lease payments. The space also is available to the public for free upon request.

“A lot of tenants were building out huge conference rooms in their space and not using them,” said Craig G. Scheiner, vice president senior asset manager at Manekin. “You don’t have to build out a board room for 28 people.”

Manekin documented interest in such an amenity when the firm surveyed the top 100 firms in Baltimore before spending money on their renovations.

“It’s an amenity that’s done very well in the last 18 months to help us reposition 36 S. Charles,” Scheiner said.

Beitler predicts that Baltimore’s office buildings will increasingly feature Internet cafes, places where employees can go during lunch hours and before or after work, to do personal business on the Internet, including paying bills or catching up with children who are away at college.

Although he admires Kornblatt’s ingenuity in trying to reinvent itself through its revamped conference space, he is skeptical about how successful that firm or any other will be in reaching a broader market.

“Whether this is something people will really find to be a benefit and whether it will be a good little business, time will tell,” he said. “But our experience has been that it doesn’t work.”

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(c) 2004, The Baltimore Sun. Distributed by Knight Ridder/Tribune Business News.