MARKET FOCUS: Real Estate - Stories of success. The economy mayhave hit commercial development, but luxury and mix-use construction isbooming. Allen Houston looks at the role of PR in real estate

Economists were already forecasting a slowdown in the construction

of retail, industrial, and commercial property when the events of

September 11 transpired. Projections for commercial real estate

worsened. With lenders hesitant to provide loans, the consensus is that

hotel and markets for large, retail mall construction are likely to be

brutalized in the upcoming year.



But the good news for real estate PR is that the residential market -

particularly luxury residential - continues to show a remarkable

resilience, buoying the economy and heartening investors.



"While the hotel market parallels the pulse beat of the economy, the

luxury sales market is going to stay particularly strong," expounds

Steve Solomon, EVP and head of the real estate division at New

York-based Rubenstein Associates.



One of the reasons why the current downturn doesn't resemble the deep

recessions of the '70s and late '80s is that planners were keen not to

encourage an excess of housing during the last boom period. "The real

estate market has not been over-built," confirms Solomon.



Rubenstein's clients include New York real estate luminaries like The

Worldwide Group, Donald Zucker, Jack Resnick & Sons, and the Manhattan

Mortgage Group. One of the agency's biggest current projects is 425

Fifth Avenue, a 67-story mix-use luxury high rise by the Davis Partners.

Such mix-use developments will account for some of the strongest growth

- and greatest challenges - for seasoned real estate communicators

during the next year.



While the luxury market will fare well, Solomon believes that New York

agencies need to be extra sensitive in how they portray their real

estate clients and the benefits they bring to a community. He points to

a new condominium development in TriBeCa, a neighborhood close to the

World Trade Center. "You can't make believe that September 11 doesn't

have an effect on your New York clients," he says. "It's meeting and

overcoming those challenges that creates credibility for an agency."



High-end amenities



Florence Quinn, president of New York-based Quinn & Co., believes the

luxury market will do well because clients are looking for the high-end

amenities that a luxury residential development can offer. One specific

trend she sees is hotels, such as the Westbury, developing residential

properties within the hotel complex. The hotel guests are located on the

bottom floors, while the top consists of luxury residential

apartments.



She believes that aging baby boomers with money want to be able to call

upon the services of the hotel.



Quinn also notes the "designer label" effect of commissioning famous

architects to plan developments. "Luxury buildings are using well-known

architects such as Robert Stern and Richard Mier to build residential

luxury condos," she says. "These architects ensure that the buildings

will be of high quality, create immediate brand recognition, and allow

the owners to brag. And it creates opportunities to go to the

media."



Quinn worked on the Foundry development on New York's 10th Avenue. The

12-story building comes complete with a waterfall and Zen garden. To

raise awareness, Quinn created coasters that were distributed to bars in

the neighborhood. The agency also distributed mints that were branded

with the Foundry name. "We started to create a buzz before we put the

properties on the market."



Of course, location and space constraints will always make New York one

of the most expensive places to buy real estate. Not surprisingly, a

PricewaterhouseCoopers report - Emerging Trends in Real Estate 2002 -

states that the urban locations with the top markets will be New York,

Boston, San Francisco, Southern California, Chicago, and Washington,

DC.



PR's place in redevelopment



Other areas have a booming real estate PR industry as well. In southern

Florida, "redevelopment" has become the buzzword of the moment. Land has

been developed to the edge of the Everglades, which has provoked not

only the public affairs issues that invariably arise from trying to

recast neighborhoods, but also the challenge that comes with trying to

explain the advantages of urban living in a suburban environment.



Kreps/DeMaria/Treister is busy promoting the Downtown Dadland project,

which stands on the site of a mall that is being torn down and turned

into an amalgamation of apartments and retail units. "The redevelopment

of the mall into a mix-use space has generated a significant amount of

media attention," says managing director Israel Kreps. "We're focusing

our attention on a savvy group of real estate writers based in New York

and Florida. Their interest is piqued by the trend of bringing back city

centers through urban renewal." The development targets young

professionals and empty nesters that are attracted to living in an urban

environment.



Kreps also has a number of high-end clients geared specifically to the

luxury market, including elite Fisher Island, where Oprah Winfrey, Mel

Brooks, and Boris Becker have second homes. It also represents the

Cloisters, a community of 40 villas on Coconut Grove Bay in Florida. The

agency runs extremely targeted PR efforts to sell the luxury houses: VP

Lisa Leuchter Treister concentrates her efforts on working with

charities' wealthy patrons, who are likely prospects for the

developments.



With the Cloisters, the agency set up an event that connected it to the

Green Street Cafe, a popular restaurant close to the development. The

agency sent out an invitation to potential customers with homes valued

at more than $500,000 to become Sunday guests at the restaurant.

Those who participated drank mimosas on the roof overlooking the

Cloisters, and were given passes for breakfast or lunch. In November,

the agency hosted a lecture/cocktail reception about Latin American

Contemporary Art, which drew an upscale Hispanic crowd. "It's only 16

miles from Piscayne Bay to the swamp, so residential real estate and

luxury residential are always going to be in demand," says Kreps.



The celebrity hook



Celebrity links can also create quite a stir. Boardroom Communications,

another South Florida agency, specializes in publicizing high-end luxury

houses. Its clients include real estate heavy-hitters such as Wimbish,

Barclay, and GMAC Reality, all of which sell or develop luxury

houses.



(Paul Wimbish sold the Versace mansion in Miami.) "People love stories

about the rich and famous," says Don Silver, Boardroom's VP of marketing

and consulting. "Any time a celebrity buys a home in the area, it gives

us the chance to call gossip and society columnists, and place stories

about developments."



Microsoft has taken this approach a step further online. Its website

Homeadvisor.com features virtual home tours, with the actual celebrities

selling their properties. Weber Shandwick Worldwide's Seattle office

represents the site, and account manager Scott Charleston concurs that

the cult of celebrity is a good way to raise the profile of a property,

as well as attract media attention. "Homeadvisor.com has featured

celebrities like Whoopi Goldberg and Randy Travis," he says. "It's a

good draw."



Residential real estate PR is not just about selling homes, however.



By design, the state of California has some of the most stringent rules

for land development in the US. In the last year, 630,000 people moved

to the sunshine state, while only 210,000 homes were built. "Real estate

is an extremely regulated industry," explains Laer Pearce, president of

Laer Pearce & Associates. "Not only is PR incredibly important in

espousing the benefits of living in certain neighborhoods, there is also

a huge amount of public affairs work that goes into getting a

development completed."



Newhall Ranch, a 21,000-home development outside of LA, is one of

Pearce's clients. The dynamic neighborhood features schools and

pedestrianized shopping areas. Pearce says that agencies with real

estate clients need to be prepared for every possible problem under the

sun, including animal-migration corridors, air-quality issues, zoning,

traffic congestion, environmental regulation, homeowner rules, and local

agendas.



"There is a very not-in-my-backyard mentality when you're developing a

new housing project," says Pearce. "And where there's so much

regulation, our communication skills and strategies are needed. We have

to be able to build bridges, prepare the land developer for hostile

questions, and help communicate their views."



All of these issues contribute to a fascinating PR discipline. "There is

always going to be a market for the right location and the right

amenities," concludes Anne-Marie St. Germaine, senior VP at

Chicago-based Jasculca/Terman Associates. "The great thing about real

estate PR is that unlike other areas of the communications business, you

can actually witness the results of your labor."



Also see Media Roundup, p.10.



PR AND URBAN RENEWAL IN ATLANTA



Atlantic Station, a 140-acre mix-use housing and retail development

being built on the site of the old Atlantic Steel Mill in midtown

Atlanta, is being watched with curiosity by elected city officials

around the country.



The project is being hailed as a model of how a municipality can reclaim

desolate, brown field property, and turn it into a thriving urban core,

complete with movie theatres, hotels, restaurants, supermarkets, condos,

and apartments.



The trend of rebuilding city centers, which started in earnest over the

last decade, is a by-product of urban sprawl, lengthening commute times,

dissipating air quality, and a renewed interest in urban living.



The Headline Group, an Atlanta-based PR agency, saw so much potential in

the Atlantic Station project, that it moved its offices from the popular

Buckhead area to a building overseeing the site.



"One of the first things we did was set down and streamline the

communications process for the developers, making sure that they spoke

with a single voice," says Mary Eitel, EVP of The Headline Group.



The agency generated stories about the project on a local level.

Atlantic Station received a full page of copy in the Atlanta

Journal-Constitution. "Locally, we need everyone to know how the

dynamics of the city will change," says Eitel. "There were a lot of

people who didn't know quite how big this project was going to be." The

first phase of the project, scheduled for completion in 2003, will

include 1,300 residential units.



Eitel hopes The Headline Group can promote the development on a national

level. "The whole idea of the reclamation of this brown field is an

amazing story," she says. "The great thing about this project is that it

has taken on a national prominence. The EPA has joined in cleaning up

the site. Eventually, we hope that this becomes the model for other

cities around the country."



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