Sonny Kalsi | Co-CEO | BentallGreenOak | BentallGreenOak Co–CEO shares his passion for buildings

Transcript

DA: Welcome to TEN, the Tenant Experience Network. I’m your host, David Abrams. In this episode, we are connecting with Sonny Kalsi, co-Chief Executive Officer, BentallGreenOak. In this episode, we learned how Sonny’s career journey began working in investment banking at Morgan Stanley on Wall Street. After completing his studies in finance, he had an opportunity to rotate for mergers and acquisitions to join the real estate group, which he thought would only last a year or so. But it stuck, and he feels very fortunate to still be working in commercial real estate. Sonny has lived and worked in six different countries, and that experience is just one of the reasons why he has stayed in the industry so long. Sonny started Green Oak in 2010, and sometime later a former Morgan Stanley colleague, Amy Price, then president at Bentall Kennedy, connected to say, “Hey, I have a crazy idea.” A year later, they got married and their union created BentallGreenOak. We both share a passion for buildings or battleships, as Sonny likes to call them. I really enjoyed hearing about his family’s story and our discussion around real entrepreneurship. Sonny shared his thoughts on technology disrupting CRE and the impact it’s having on each sector of the industry. We talked about buildings and cities, and the idea of placemaking, as well as the partnership between landlords, tenants and government. Sonny highlighted several ways that technology can improve the customer experience and also impact property management to help drive efficiency, find cost savings, and contribute to sustainability. Our conversation was free flowing and super engaging, and I look forward to continuing to stay connected with Sonny. We’re excited to share this podcast with you. So be sure to subscribe to TEN, so you never miss an episode of the Tenant Experience Network. And now I’d like to welcome Sonny to the show. Sonny, I’m really glad you could be with us today, and I’m really looking forward to our conversation.

SK: Thank you very much, David, for the opportunity.

DA: Awesome, so let’s start with your journey to your current position role. How did you get started in the business?

SK: You know, it’s a great question. It’s a question I actually always ask young people myself, because I kind of have a roundabout way in. You know, family’s from originally from India, son of a nuclear engineer, grew up in Tennessee, went to school, Washington DC, and I had no idea what I wanted to do. And a lot of my friends seemed to be going towards finance. So I studied finance, and then I followed them to Wall Street and got a job at Wall Street Investment Bank, and worked for a year in a mergers and acquisitions group. Didn’t really like it, it wasn’t really for me. And I had an opportunity to go to the real estate group for my second year rotation, and I thought I’d be doing it for a year or two, and then going off to business school. And that was 1991, and I’m still here in the industry. So, you know, I kind of happened into it and, you know, I considered myself very fortunate that I wound up in a great place.

DA: That is so often the case, and this is one of my favorite questions, just loving to hear about people’s journey and how they got here. And more often than not, it wasn’t deliberate.

SK: No, well, and you know, David, I think one of the things I said, you know, young people, I feel bad for them, ’cause I think they put a lot of pressure on themselves. They’re trying to figure out the three-year plan, the five-year plan, the 10-year-plan, and I tell them.

DA: Right.

SK: Candidly, I’m not sure I have one of those right now.

DA: Right, one year at a time. Maybe just expand a little bit sort of once you, you know, happened into real estate. Maybe tell me a little bit more about that journey and now your current role as well.

SK: Sure. So, you know, I did that rotation into the real estate group at Morgan Stanley. And, you know, really liked the industry. I liked a number of things about it, but probably the two biggest things I liked about it were one, just the people. All kinds of interesting people in the industry. Lots of entrepreneurs, you know, but obviously a lot of institutions as well. And it was a wide variety, and I liked that. But then number two, I just really liked the tangible nature of it. I liked the fact that it was something you could touch and feel. I sometimes say jokingly, everyone is a real estate expert in a way, my mom is a real estate expert. She knows where she likes to shop and where she likes to stay on vacation or where she likes to live. But it’s also a truly global thing. You know, in my career, I’ve lived and worked in six different countries, you know, because real estate’s a global business. And that was also something that really, I didn’t appreciate that upfront, but I really liked that about it. And then it gave me an opportunity to live and work abroad. And that was awesome too. And so.

DA: Right.

SK: You know, that’s probably why I stayed in the industry as long as, now I’m too old to do anything else.

DA: You’re stuck, you’re stuck. No other options.

SK: No, yeah, no other options.

DA: No other options, and the journey to BentallGreenOak, how did that all come about?

SK: Yeah, so again, I think, you know, back to the comment about maybe not always having the 10-year-plan. You know, I worked at Morgan Stanley for more than 18 years and, you know, it was great. I really liked it there. And then, you know, that ended, and some things come to an end sometimes, and had a one year non-compete. And I spent a year thinking about what I wanted to do, and decided with a bunch of my former colleagues to start a business from scratch, which I don’t recommend to everyone, but we started Green Oak in 2010. And we just started building that organically and going along, and, you know, the first few years were really hard. But then we picked up momentum, and then people started calling us seven or eight years in. And one of the phone calls we got was from Amy Price, who was the president, Bentall Kennedy at the time.

DA: Right.

SK: And a former Morgan Stanley colleague of mine. And she called and she said, “I have this crazy idea.” And a year later we got married.

DA: Wow

SK: Philosophically speaking, you know.

DA: Wow.

SK: Brought the businesses together and to create BentallGreenOak, you know, SunLife. We’ve obviously, a big party at the table as a 51% shareholder.

DA: Right.

SK: So that’s how it all happened. But I would say, David, you know, part of it is just, you know, being open-minded about opportunities. And I think part of it is, you know, if you build a business and you try to do things the right way, other opportunities come up.

DA: Yeah, amazing. Well, like you, I sort of started out in finance, started out in public accounting, saw an opportunity to do something different, got into the marketing world. And again, I just happened to pitch and win Brookfield Place, NBCE place originally in Toronto. So that dates me a little bit.

SK: Yeah.

DA: But Brookfield Place was my first client, which I kept for a long time. And, you know, worked for every other major office tower in Toronto over the course of my career and fell in love with buildings.

SK: Yeah, they’re cool, they’re cool.

DA: They’re cool, and, you know, I had the opportunity because of the role, even though it wasn’t necessarily what I did every day, but to really explore and get familiar with the bowels of the building, you know, every different aspect of the operation, and just developed an appreciation for what it takes to keep buildings running every day. And I always viewed them as small cities.

SK: I’m fascinated whenever I get a chance to spend time with our property management team or, you know, the folks that are kind of on the front end of managing these assets, they really are. They’re like big battleships.

DA: Yeah.

SK: Like, there’s always something going wrong, but there’s always an opportunity to optimize and change. And they’re, look, in a lot of ways, they’re living, breathing animals. You got to, like, really can’t leave them stuck in time.

DA: Yeah.

SK: Because if you leave them stuck in time, time will pass you by.

DA: Agreed, agreed. So tell me, why do you think you were so uniquely suited to this opportunity? I mean, you know, you started out in the finance world. You became an entrepreneur, you know, early days. That’s what really you did, but you know, what’s helped you to be successful?

SK: I would say couple of things. One, you know, just very supportive upbringing. You know, my sister and I, you know, our parents are immigrants from India. I was three years old when we moved to the US myself. And just having, you know, a lot of love and support, but also parents who always encouraged us that we could do whatever we wanted, right? Just whatever you put your mind to, you can do it. And so I think that number one, but then number two, just being open-minded.

DA: Right.

SK: You know, a lot of people I think have overly rigid point of view on how they define success and what they want to do, and what they want their path to be. And I think partly because of my parents who, you know, left everything behind, left India and everything else where they had a, you know, an easy lifestyle to kind of risk it all, if you will, to move halfway around the world to provide a better opportunity for their kids.

DA: Right.

SK: You know, that’s risk taking, right? And that’s not risk taking that I think you think of in a classic sense, but, you know, but what I took away from it was be open-minded, right? So when I had an opportunity at Morgan Stanley to go work in Europe, I did it. Then go to Asia, I did it, you know. I then found myself trying to figure out in my early 40s what I wanted to do next in life, and there was an opportunity to do something more entrepreneurial, I said, why not give it a shot, right?

DA: Right.

SK: I mean, so to me, I think it’s been just that the nature, being open-minded, being open to ideas, being willing to give something a chance.

DA: Yeah.

SK: And maybe saying yes when other people aren’t saying yes.

DA: Right.

SK: Or are hesitating. So I know it’s a little bit nebulous, but that’s kind of, I would say, how I kind of think about it.

DA: Yeah, no and I’m just thinking as you sort of shared that story, you know, maybe leaving where you live and going to a new country with, you know, virtually nothing to make a new life. Maybe that’s the greatest definition of entrepreneurship.

SK: Oh yeah, you know, look, we got nominated by Ernst and Young several years ago to be Entrepreneur of the Year. And we came in second to a tech company, by the way. We shouldn’t have come in second to a tech company. This is before we worked at Bentell Kennedy. And when they’re interviewing me for it, you know, for their different puff pieces and all this stuff, I just kept saying, look, you know, it wasn’t that hard for me. I mean, I had almost 20 years of real estate experience, had a bunch of great partners who I’d worked with for a long time. We were not poor, we had money. We had the ability to fund ourselves and do this. The real entrepreneurs are people that leave their families behind.

DA: Right.

SK: Move to the other side of the world with nothing. My parents came to the US for 20 bucks, right? I mean, that’s entrepreneurism, right? And you know, and by the way, you know, well, 98% of us in the US and Canada are here because of someone who immigrated at some point, right?

DA: 100%.

SK: So I just did, look, I think that to me is what true entrepreneurism is all about, risking.

DA: I agree. Maybe there should be more books written telling about people’s story coming to new countries as part of entrepreneurship education, right?

SK: I agree 100%, yes.

DA: Yeah.

SK: There’s no safety net, right? Really. I mean, if you may have some family, you may have a friend of a friend of a friend and whatever.

DA: Yeah.

SK: And then my parents did the same thing. They actually brought over half their extended family over.

DA: Of course.

SK: To us over time to help do that, and look, I just, you know, I was just at this family function this last weekend and just seeing, you know, now there’s third generation kids, you know, these little kids running around and all this stuff. It’s awesome.

DA: Amazing, amazing. Well, thank you for sharing that. I love that.

SK: Yeah. I know that doesn’t have anything to do the real estate market, but, you know.

DA: That’s special. All right, let’s get back to real estate, why we’re really here.

SK: Yes.

DA: So I think we can agree that the commercial real estate industry has gone through one of the most turbulent periods of time we can ever remember. You and I have both been through a couple of those in the past.

SK: Yes.

DA: You know, commercial real estate, largest asset class in the world.

SK: Yeah.

DA: But certainly, it’s continuing to rebound, you know, from this period of low levels of occupancy. It’s, you know, really having to think twice about the business that it’s in.

SK: Yeah.

DA: And how it meets the needs of people going forward.

SK: Yeah.

DA: It’s crazy and I think some very exciting times. I know there are a lot of people that are still quite nervous.

SK: Yeah.

DA: But you know, where there’s, you know, challenges, there’s also opportunity.

SK: Sure.

DA: So we believe that this, you know, buildings are really now part of a much larger workplace ecosystem that the physical workspace is now just part of that. We can work from a local cafe, a vacation destination, we can work from a coworking space. This is creating an opportunity, and buildings, I think, still have a vital role to play. So, you know, you got feet on the ground. I’d love to hear, you know, what you’re seeing, what you’re thinking about commercial real estate, and how it is re-imagining the business that it’s in?

SK: Well, look, I mean, first thing, when you’re in business long enough, 33 years. One thing you always realize is there are always going to be cycles, right? And what we are in is in a big cycle right now with a couple of different things going on, right? You’ve got, obviously because of the pandemic, you know, the pandemic accelerated a bunch of stuff from a secular perspective, right. You know, we’ve all used the term many times and that COVID was a great accelerator.

DA: Right.

SK: And, you know, it accelerated a lot of trends, you know, good and bad. And I think real estate hasn’t been immune. I actually think what’s happening to real estate right now is just a result of technological disruption, which is accelerated, right? We’ve seen it in so many other industries and so many other things. And it’s technological disruption, which has been accelerated by the pandemic coupled with a cyclical slowdown, right?

DA: Right.

SK: Which is just regular old economics, right? I mean, that happens all the time. But they’re happening at the same time. They converged, right? So if you think about commercial real estate, there’s winners and losers, right? I mean, it’s never been a better time to own a bunch of warehouses. Right?

DA: Right.

SK: Industrial has been a great asset class to be in for a while now. And we continue to believe it will be for the foreseeable future because of technological disruption. The loser on that, relatively speaking, has been retail. Although retail has found its footing, I think a little bit more so given it’s had some time. You know, residential, multi-res as you call it in Canada, you know, residential, generally speaking, is doing pretty well because it’s under supplied. Now there’s a social issue there, but let’s just keep it high level for a second.

DA: Okay.

SK: Office is the worst six-letter-word real estate, right?

DA: Right.

SK: I mean it used to be retail, now it’s office.

DA: Right.

SK: But it’s all technology, right? We’re doing this on Zoom. I didn’t know what Zoom was three and a half years ago. I’d never heard of it, right? And then for anyone who used Skype, I’m sorry if anyone listening to this, you know, owns Skype, it’s terrible. And in Skype, there’s no zoom, right? So technology has allowed this disruption to happen. And it’s happening at a time where, you know, look, with the pandemic and how people thought about it, and how it impacted them, it’s got them in their head thinking about life and what do I want to do when I grow up, and all of this stuff. So it’s a real challenge, right? But I would say when people say commercial real estate’s in trouble, I think that’s too simple a thing. There are parts of the industry that are actually doing better than ever. It’s office that is going through its existential crisis right now.

DA: Right.

SK: And the issue is, if you mentioned Brookfield Place, et cetera, it’s the biggest asset class of most institutional investors portfolio. They’re huge, you know, they’re a huge part of every urban, you know, downtown area, and they’re not going anywhere. Right?

DA: No, they’re not.

SK: So we have to figure out what we’re going to do with these things. Right?

DA: Right. Yeah, no, there is a certain permanency, but I’ve also learned that just because, you know, real estate is so physical doesn’t mean it can’t change and evolve. And I think that, you know, I really do believe that we’re going to look a little bit more like we did pre-pandemic than post.

SK: Yeah.

DA: I don’t think we’re going to be landlocked to having to work physically in an office, you know, five days a week from morning till night. I think that we’ve learned that flexibility can work. We’ve learned that people can be trusted. We’ve learned that productivity can be maintained. But I think we’ve also learned that being isolated and being dislocated is not necessarily a winning solution either.

SK: Yeah.

DA: You know, if people choose to work remotely 100%, that’s a decision that they can make. But I really believe that businesses that are building, that are creating new, that are re-imagining themselves, that are, you know, they can’t do it in the absence of being physically connected to their people at some point. So I think buildings are going to have a role. I think buildings are going to be, just maybe utilized differently, but I think there’s a lot of opportunity.

SK: I agree with you 100%. Look, I’m probably a little bit more as a big owner of real estate.

DA: Right.

SK: And as you know, someone in my mid 50s towards the end of, I think, you know, in the office more often is better than not. But I also agree that, you know, five days in the office, you know, morning till night is probably, for the foreseeable future, a thing of the past.

DA: Yeah.

SK: And I think that, you know, look, ultimately as employers, we need to create an environment where our team members are excited to be there and they feel like they’re thriving and growing. You know, we can have a point of view that that’s better done when they’re all in the office more regularly, but ultimately they’re going to decide.

DA: Yeah.

SK: And so I think flexibility is going to be key. The way I’ve always thought about this, David, is, and even before the pandemic, if someone needed flexibility because it was the way to keep them in the workforce longer, for example, you know, if they’ve got childcare issues or whatever, I have no problem with that. Like, in fact, you know, if you’ve got someone, you got little kids, you’re trying to figure out how to make that work with your, you know, if you have your partner that you’re, you know, co-parenting, whatever, figure that out.

DA: Yep.

SK: The 20 something who’d rather be working from the beach, I’m not that sympathetic to that. You know?

DA: You know.

SK: And I don’t think it’s not good for them.

DA: I don’t even think that’s the case. You know, we had a young person apply for an internship last year, and we were still remote at the time. And she did not accept our position because she wanted to be physically with people, and to be mentored, and to have the social component, you know, after work and and whatnot. And I really admired her. I was very disappointed, but I thought, you know, that’s awesome. So, you know, I think across the spectrum there’s a real mix of what people want. There are people that are in their 50s and 60s that, you know, are loving this and, and will never come back. And there are others who, you know, they’re back full-time. And I think that’s the same across the entire age spectrum.

SK: I agree, I agree.

DA: Which I think is what’s great is I don’t think we have to label people and say, well, it’s the 20-year-olds that don’t want to come back ’cause that’s actually not the case.

SK: Yeah, yeah, yeah, look, and I think to your point on real estate, the market will find its way, right? I think that, you know, Bill, if we stay with office buildings, which are newer, better, more fit for purpose, you know, candidly, you know, more up to environmental standard, have a element of live, work, play to ’em.

DA: Yeah, yeah.

SK: You know, place people want to go, those are going to do better. And ones that are not are going to do worse. And again, there’s going to be a continuum of outcomes here. And we see it in our own portfolio. Our assets that we have that are newer, the assets that we have that have been more, you know, that have been repositioned relatively more recently, et cetera, are doing better.

DA: Right.

SK: Assets which are older, et cetera, are not. But again, this is not going to get figured out overnight either, right?

DA: Right.

SK: I mean, because this is like, you got the employee, then you got the tenant as a collective, then you got the building itself, and this is going to take time to get sorted out, which is probably a good thing because I think if it had to get figured out overnight, I think it would be hugely disruptive.

DA: Right. That’s actually a perfect segue to my next question in terms of, you know.

SK: Right.

DA: So, you know, my background having more from sort of the marketing communication side of real estate, although my biggest responsibility was helping to connect building operators to their tenants, to their customers and deliver great experience. Now we’re doing that through technology, you know, really helping to digitize that customer experience. But we think a lot about the way in which building operators can work with their tenants, their occupants at the occupier as well as the, you know, each and every person that enters the building.

SK: Right.

DA: So just your thoughts in terms of, you know, your operation teams, how involved are they getting in collaborating more with the occupier as we all work to sort of figure out, you know, the role of buildings and how we can make them better for people that work in them or live in them for that matter?

SK: Incredibly, because I think that’s a big differentiator. You hit it on, it’s all customer service at the end of the day, right? Right. And I think customer service is always important, right? I come from the philosophy of the customer is always right even when they’re not. Yeah. And so, yeah. So, you know, so working with them and figuring this out, you know, look, if you think about industry, you know, most of our tenants are service businesses. And in a service business, your biggest cost is labor. Yep. Your next biggest cost is often space. So it’s a big part of your bottom line, even in a normalized operating environment. In a tougher operating environment like this, especially where you’ve got question marks about how many employees are going to want to be around, you as a tenant employer are doing everything you can to try to optimize that outcome. And having the right relationship with your landlord is critical. It’s a partnership. Right. The way that’s how we think about it. It’s a partnership in the good times and these challenging times, it’s even more of a partnership. So, you know, I’ll give you an example. We’ve got a big asset in the New York area that we’ve got a tenant that’s in, that’s thinking about doubling their space, would be a great outcome for us. Their whole process actually, in terms of figuring out if they’re going to stay and double their space actually has, they like the building, they’re already in it, but as they talk to people, it has less to do with that and what the dollar per square foot rent is. It has more to do with how much money are you going to put into it, what are you going to do to it? And we have input on that. And then are you going to reposition this from the standpoint of what amenities you’re going to put into it that our employees are going to like. And our answer in a normal environment, which I still don’t think we’re in a normal environment, I refuse to accept we’re in a new normal.

DA: No, not yet.

SK: We would have that a discussion with ’em anyways. We are absolutely having that discussion with ’em now.

DA: Right. Right, so I think, again, I think that’s where there’s opportunity and it’s not just a you against them. It really is a collaboration to reach that successful outcome.

SK: 100%, yeah, 100%. I think if you have a you against them and transactional type relationship, then, you know, you might have a tenant that signs a lease and that tenant’s probably going to be gone when that lease is over, so.

DA: Right, right. And we know how hard it is to get tenants. We certainly want to do all that we can to retain them.

SK: Exactly.

DA: We certainly think a lot about that as well and how we can play a role in that. You know, I think a lot about buildings and their place in neighborhoods and cities. When we built HILO, rather than just selling individual building apps, we built HILO as a platform that connects buildings to not only the people that work in them or live in them, but also to the neighborhood, to the city.

SK: Right.

DA: That ultimately we’ve got to create a bigger experience to really create the kind of level of engagement that we want to deliver. So again, we don’t view buildings as being siloed. We view them part of an integral component of vibrant communities and cities. Now we’ve just gone through a period of time, particularly in urban settings, New York, you know, you know it all too well, where, you know, those cities were pretty quiet and pretty scary looking.

SK: Yeah.

DA: So just wondering about your thoughts on, you know, the role, the responsibility that buildings and workplaces should be playing with the community, with neighborhoods and cities to create, you know, a really dynamic, engaging, desirable place to be. We do some work in Downtown, Ottawa and you know, it’s scary still what’s going on in that market, ’cause government hasn’t come back and the buildings are empty, and the retail have all but, you know, shuttered up their stores. So just your thoughts on buildings and community in cities.

SK: Well, I’m glad you mentioned government because I think they have a big part of this whole ecosystem. I think it’s really critical to that. So look, we often think of what we do as placemaking in terms, you know, certainly our larger assets, certainly in an urban setting, right? And many of ’em are mixed use. So you’ve got people that are living there, you know, obviously working there, et cetera. And I think with these urban environments, especially the ones that are 24/7 cities, I think that there’s a very important partnership which has to exist between landlords, tenants, but also government.

DA: Yeah.

SK: It’s very critical. It’s one of the bigger issues we have, I think, in many, you know, major metros in North America is, you know, for example, the municipal workers aren’t back. You know, it’s a case in New York City. You know, the governor, I’m sorry, the mayor has been trying really hard, can’t get ’em back, right? You know, every time they make a thing where you got to be back two days a week, is people just ignore it.

DA: Yeah.

SK: And I think, you know, part of the issue here, when people think about, you know, what we’ve seen in certain downtown locations with people having a, you know, not feeling safe, et cetera, you have to have people on the street in order to have a vibrant type of, you know, streetscape for people to feel safe. Right?

DA: Right.

SK: Because you can’t put a policeman on every street corner. You can’t put one on every subway car, right? What the policing that happens is other people, right?

DA: Other people.

SK: So that is really critically important. And so it’s circular, right? And so everyone’s got a, you know, and like, you know, I know this from a New York perspective because I was part of the group that really pushed hard to try to get the city open again, hit hard by the pandemic. And a lot of the big financial institutions and asset management companies, et cetera, we all got together and said, “Okay, we’re going to start going back, right? We, the leadership are going to start going back. We’re going to try to cajole our people to go back.” That’s great, but if we’ve got a million municipal workers that are not back, you know, it’s hard, right? And so that partnership is super critical and I think that’s why I said, I think this is going to take a while to get it figured out. Right?

DA: Yeah.

SK: Look, I think the cities that figure it out faster are going to be winners, right? The other thing which happens, David, you know, you talked about it earlier, in this world that we live in with technology, et cetera, people aren’t as locked down where they, you know, just because you were born and raised in Toronto doesn’t mean you have to be in Toronto for the rest of your life. Right?

DA: Right.

SK: Or work for that matter or whatever else. So, you know, labor is flexible, labor can move. They’re going to move to where the jobs are, they’re going to move to where they feel better about where they’re living, you know, the environment overall. And so I think cities are, you know, competition with each other now more so than ever because technology has made it a lot easier for the cities to compete with each other.

DA: Absolutely.

SK: So get them right. Getting this right is a critical part of the solution.

DA: I agree. And you don’t have to be in that city full-time to be able to work in that city. So, you’re right. I mean, a lot has changed and we need to be thinking about this and responding. Just a plug, I actually reached out to the Government of Canada to help support them in their return to work and to try to encourage them to work with us, particularly in Downtown, Ottawa. I have yet to get a positive reply, but I’m still working on it.

SK: Yeah. look, and by the way, I think most of, I mean, whenever I’ve had an opportunity to talk to, you know, people in government, they want, I mean, candidly they want people back.

DA: Yeah.

SK: Right? I mean they, you know, the mayor in New York City, he wants people back. Right? It’s hard.

DA: Yeah.

SK: It’s hard to get them back. And it’s like, you know, I think of the private sector, it’s a little bit easier. Like, you know, whenever I have a tenant, I’ll talk to a tenant and they’re like, you know, Sonny, I’m having a hard time getting my employees back. And I’m like, you’re the CEO, why don’t you just tell ’em they have to come back?

DA: Right.

SK: You got to be back three days a week. Just tell ’em they got to do it. Well, I don’t know, how they’re going to respond. Look, some of them might respond by walking out on you. But, you know, look, I will say this, the fact that we’re in a cyclical slowdown right now might be the single biggest thing that’s going to conjole people back into the office. Right?

DA: Right.

SK: That’s probably more for the private sector than it is for the government sector. But for that might be the biggest thing because if all of a sudden people start worrying about, am I going to really have a job if I don’t get back to the office?

DA: Yeah.

SK: Or am I going to get left behind professionally? Because, you know, David’s in the office and Sonny’s not. And so, you know, he is getting those type of things. I don’t think you should lose sight of how important that’s going to be to all of this.

DA: No, I agree. It’s unfortunate we have to think in those terms. But I agree.

SK: Yeah, I know. Well, look, I personally like using the carrot much more than the stick.

DA: Yeah.

SK: Personally and professionally, but every now and then, you got to use the thread of the stick a little bit.

DA: I agree, I agree. Sonny, let’s take a short commercial break and we’ll be right back.

COMMERCIAL BREAK

DA: And now I’d like to welcome back to the show, Sonny Kalsi, co-Chief Executive Officer at BentallGreenOak. Loving the conversation, really glad you could be with us today.

SK: Thanks.

DA: We’ve talked a lot about technology. You talked about, you know, the impact of technology on real estate. We certainly think it’s playing a significant role in shaping how building operators are going to deliver great customer experience to their tenants, their customers going forward. We’re all thinking about how to make the workplace engaging and desirable. So just curious, you know, with a focus on sort of meeting the evolving needs of people in buildings, and probably with a first line of sight that people you’re already talking to, you know, in the world as they’re making their real estate decisions, what technologies are you seeing that are sort of gaining traction in helping to deliver that great experience?

SK: So I think anything which helps the customer experience, you know, in terms of connectivity is really critically important. And it makes just life easier, right?

DA: Yeah.

SK: So if you’re a perspective tenant and you’re thinking about where I want to go, right? Having a technology solution which helps you cut through and figure out, okay, there’s hundreds of options, what are some of my best options before I even get a broker involved or anything else? I think we’re in early days of that kind of technology being a critical part of hub.

DA: Yeah.

SK: For sure, from a building management perspective, you know, as we mentioned earlier, these are like, you know, big battleships and, you know, they’re very complicated assets. And I think anything which, you know, any kind of technology which helps the landlord run a building more efficiently is helpful because it all drops to the bottom line. And, you know, look, a lot of times we know we need to reinvest in our assets. And if we have more money to reinvest in our assets because we’re running ’em more efficiently, that’s a win-win for everybody.

DA: Right.

SK: I would say if I keep going down that path, I think anything which is focused on sustainability is also key. You know, I just think that, you know, look, we’ve been very focused on ESG broadly, but I always say it’s because I think we have to be from a business perspective as a fiduciary, you know, if you think about buildings and you think about, we talked about differentiation of buildings before. Our views is that buildings which are cleaner and greener are going to outperform in a lot of ways. One, it’s what employees want, that’s where they want to work.

DA: Yeah. 

SK: And therefore it’s what the tenants want. If you look at any RFP from a tenant, you know, if a building is not using a US classification of LEED certification.

DA: Yep.

SK: They’re not up to certain standard, they’re not even going to look at it. Almost everyone’s got a net zero target, even tenants. Right? So that’s going to be a big part of their calculus. So anything which is, you know, technology which helps you run a building on a more green basis are also technologies. And then I think once you get your tenant in, anything which helps your tenant and their connectivity to provide a better experience you know, for the employees, et cetera, you know, whether it’s basic things like, you know, food and whatever, or you know, scheduling, how do you schedule conference rooms? Look in this world we live in now, you know, I know we have a number of tenants who have less space. If everyone came in on Monday, they wouldn’t have enough space for everyone, right? So software that helps them figure out who’s sitting where on a given day and all of that.

DA: Yeah.

SK: You know, all these things. I think our industry is early days from a technological disruption perspective compared to others. And I’m not a technology person, you know, from the standpoint of like, it’s not what I do. But I appreciate how important it is. And I’m also realistic to the fact that we’re the front end of this wave. There’s a lot more to come.

DA: I agree. You know, pre-pandemic when it really did start, you know, we were at home base, you know, just waiting to get a hit. Through the pandemic I think we got to first base, and I think we’re somewhere between first and second base. I don’t even think we’re yet at second base in terms of, you know, the evolution and the opportunity in front of us. It’s interesting that you mentioned ESG because ironically, when I first wrote the strategy document, what ultimately became HILO, it was 2013.

SK: Right.

DA: And why was that? Because all the buildings we were working for at the time were all getting their LEED certification.

SK: Right.

DA: They were all thinking about being more green, and the primary form of communication back then was print.

SK: Right.

DA: So, you know, we would desk drop through the cleaning crew overnight, you know, brochures and newsletters, and all kinds of documentation, you know, on every single desk in every single suite throughout the building.

SK: Yeah.

DA: And that was how, you know, people came in the following morning and that’s how they got our message. And I thought, why aren’t we speaking to people through these devices that everyone was walking around with at that time, either a Blackberry or an iPhone.

SK: Right.

DA: So, you know, although we’re very much about the latter part of what you mentioned in terms of connecting people and delivering better service and experience, ESG was a large sort of push towards why I thought this was necessary.

SK: Yeah, and I think it’s going to be even more so. Like, I just think that, you know, the sustainability part speaks for itself, but even on the social part, I think that connectivity and anything you can do to make someone’s life easier.

DA: Yeah.

SK: Because not a level playing field, right? Not everyone’s coming from the same background or so, whatever. And I think anything that is done, any technology solution which helps level the playing field is a, I think, is going to be something that is, not only is a good business, but I also think it’s a good thing to do.

DA: Yeah. A whole another sort of viewpoint on that, leveling the playing field, and it could be a whole another conversation, but we kind of think that that technology can also be the equalizer for the B and C class building that, you know, you may not be able to have all the amenities that the class A building can now envision, but, you know, how do you use technology to actually sort of level up and deliver a better experience without necessarily having a rooftop patio or a gymnasium, or shower facilities, and on and on.

SK: Totally, yeah. I agree 100% with you. Like I think, again, to me, it comes down to efficiency. And I think if these buildings can be more efficient in everything that they do, they can get away with charging a lower rent.

DA: Right, and some people will want that.

SK: Yeah, that’s going to make it more competitive.

DA: Yeah, so our closing speed round, Sonny, is an opportunity to get to know you a little bit better, not just the real estate version of Sonny. So when you’re not at work, what do you enjoy doing?

SK: I actually say jokingly that I really, I’m a DJ really. I just do real estate on the side, so.

DA: Okay.

SK: You know, I can’t sing, I can’t play musical instrument, but I am kind of in a family where everyone can sing and play instruments. I figured out that DJing is the one thing I can do.

DA: Oh, very cool. So do I find you down in the Miami scene spinning discs?

SK: No, there’s not a big scene here for mid 50-year-old guy, so it’s mostly for my poor friends and family.

DA: All right, sounds good. What’s your drink, your beverage of choice?

SK: Tequila.

DA: Tequila?

SK: Yeah, tequila.

DA: Okay, all right.

SK: Yeah.

DA: Favorite movie or current TV series that you are watching?

SK: I love Ted Lasso. I just love Ted. I love the messaging, I love everything about it.

DA: Did you finish the season? I just finished the last episode.

SK: Almost done. I made the mistake of sharing it with my wife and now I have to wait for her to like, watch it as I would’ve already powered through it, so.

DA: Well, the last couple of shows were incredibly powerful, so.

SK: Yeah, no, look, I don’t, I think, you know, I know the speed round, this is not a speed comment, but I think the focus on mental health is critical.

DA: Yeah.

SK: ‘Cause it doesn’t get enough attention.

DA: Yeah, agreed. And there are so many different organizations and companies that are making it top of mind, but there’s still room, right? Lots of room there.

SK: Totally, yes.

DA: Name one way in which technology has improved how you live or work?

SK: So I would actually say my iPhone has made my life better.

DA: Okay.

SK: And some people hate it, right, whether the Blackberry or the iPhone. But I think what it’s done to me is it’s kept me less teathered down, like it used to be, had to sit in front of one of these things all the time to get stuff done. And I like being on the road. I like being with our clients, our people, et cetera. And I think something like this kind of technology, the ability to be on the road and be productive is critical for me. And therefore all the apps that come with that, right? That’s what I would say.

DA: Yep, I agree. It’s probably our most powerful computer if you really think about all that your phone does as compared to even your tablet or your laptop, or your desktop. It’s incredible, right?

SK: I still miss the buttons on the Blackberry, but it’s on.

DA: Yeah, I don’t think they’re coming back.

SK: There’s a movie, a TV show out on the Blackberry.

DA: I heard about it. A lot of people I know have seen it. I haven’t watched it yet, but I definitely will. And what is your personal choice for days spent in person working with colleagues versus working from anywhere?

SK: Oh, I would much rather be with people. I’m with people five days a week. I think it’s a critical part of what I do, is just connect, again, connecting with our clients, connecting with, you know, with our team. You know, I always say I’m better live than I am on Zoom. I think.

DA: I’ll let you know.

SK: Yeah, but, you know, but that’s me. But I also get that it’s not going to work for everyone all the time.

DA: Yeah.

SK: That’s me, so.

DA: All right. Well, Sonny, listen, first of all, on that note, I look forward to meeting you in person and I really appreciate your agreeing to come on the program and taking the time. You’ve been generous in sharing your thinking and your time. I look forward to future conversations and wishing you continued success in all that you do. And as we both battle through this crazy world of commercial real estate and all the twists and turns it’s likely still to take.

SK: Thank you, David. Thanks again for the opportunity and I wish all the same back to you.

DA: Thank you, all right. We’ll talk again soon.

SK: Thank you.

DA: Bye now.

SK: Bye-bye.

DA: I want to thank Sonny Kalsi for joining me on this episode of TEN and for contributing to the global conversation around buildings being part of a robust ecosystem, helping to build great companies, and that they’re vital in the effort to cultivate and support great people in teams. The future of the workplace will likely take many forms. And we’ll continue to explore what that looks like together. Subscribe to TEN for more conversations with leading CRE industry professionals and experts who all have something to say about tenant experience and the future of the workplace. We love hearing from you. So if you enjoyed this episode of TEN, please share, add your rating and review us through your preferred podcast provider. 

If you or someone you know would like to be a guest on a future episode, please reach out to me directly at david@hiloapp.com. And until our next episode, I wish you all continued success in building community where you work and live, thank you.

Brett Miller | CEO | Canderel | Embracing the future of work and experience

Season 4 / Episode 13 / 40:11
In this episode, Brett shares details on Canderel’s new Okkto initiative, which offers a very exciting suite of innovative workplace hospitality experiences for the users of their spaces. We discussed how technology can offer better connectivity to their customers and help to better understand their needs.

TEN Podcast guest Shimon Shkury

Shimon Shkury | President & Founder | Ariel Property Advisors | Building on great partnerships for success

Season 4 / Episode 12 / 39:53
In this episode, Shimon shares insights on the current state of the market as well as his beliefs on the opportunities ahead of us. He has a great read on what building operators need to do to create more compelling workplaces and suggested the idea of forming a Board, consisting of both building operators and the occupants, to come together and discuss emerging issues in CRE.

Gary Phillips | Managing Director | Eastdil Secured | Insights into the office market in New York

Season 4 / Episode 11 / 34:08
In this episode, we learn that Gary has been exposed to all asset classes but was able to share his insights into the office category and the challenges that it is facing, with consideration to the different classes within the overall office class. Gary provided a glimpse into the current state of the buy and sell market, as well as the new players that are entering the field to take advantage of current opportunities.

Brett Miller | CEO | Canderel | Embracing the future of work and experience

Season 4 / Episode 13 / 40:11
In this episode, Brett shares details on Canderel’s new Okkto initiative, which offers a very exciting suite of innovative workplace hospitality experiences for the users of their spaces. We discussed how technology can offer better connectivity to their customers and help to better understand their needs.

TEN Podcast guest Shimon Shkury

Shimon Shkury | President & Founder | Ariel Property Advisors | Building on great partnerships for success

Season 4 / Episode 12 / 39:53
In this episode, Shimon shares insights on the current state of the market as well as his beliefs on the opportunities ahead of us. He has a great read on what building operators need to do to create more compelling workplaces and suggested the idea of forming a Board, consisting of both building operators and the occupants, to come together and discuss emerging issues in CRE.

Gary Phillips | Managing Director | Eastdil Secured | Insights into the office market in New York

Season 4 / Episode 11 / 34:08
In this episode, we learn that Gary has been exposed to all asset classes but was able to share his insights into the office category and the challenges that it is facing, with consideration to the different classes within the overall office class. Gary provided a glimpse into the current state of the buy and sell market, as well as the new players that are entering the field to take advantage of current opportunities.