Hartford Business Journal

8 Hartford Business Journal • December 18, 2017 • www.HartfordBusiness.com Reporter's Notebook Gregory Seay | gseay@HartfordBusiness.com Real Estate, Economic Development/Construction, Banking & Finance and Manufacturing REAL ESTATE Sentry's entry into property management is a backstory about trust R eal estate brokerage and property management are among industry sectors where relationships based on trust are highly coveted. Take the recent investment by Hartford realty broker Sentry Commercial, for a mi- nor stake in Commercial Property Advisors, an Avon property management firm started in 1984 by R. Michael Levin. Levin, a lawyer who built a thriving enter- prise initially as a developer before moving primarily into managing apartments, office buildings, shopping centers and mobile home parks owned by others, is 78 now but insists he is nowhere ready to retire. However, for the purpose of succession planning and for the stability of Commer- cial Property Advisors and its landlord cli- ents, Levin said he began several years ago thinking about consolidating his operation with that of a seasoned partner. Three years ago, Levin opened talks with a longtime friend and realty associate, Mark Duclos, a veteran broker and Society of Of- fice and Industrial Realtors (SIOR) member, who formed Sentry in 1991. Though they knew each other, they said crafting a transaction that represented the best interests of both parties and their clients took some time. Three years of on-again, off-again discus- sions ultimately led to their Nov. 10 deal announcement. Neither financial terms nor Sentry's stake in Commercial Property Advisors have been disclosed. "The most impor- tant thing for me is trust,'' Levin said. "It's important that I trust the people I do business with.'' For Sentry, the desire has long been there, Duclos said, to extend its reach into fresh markets through new services, like property man- agement. At the same time, venturing into an unfamiliar real estate niche was daunt- ing, he said. "We wanted to diversify. We're all in complementary businesses,'' Duclos said of Sentry and Commercial Property Advisors. "We've always been reticent to go in be- cause we didn't want to be in the day-to-day operations'' of managing properties. Yet, the cross-sell opportunities that prop- erty management offers, Duclos said, are too lucrative to ignore. For example, most commercial real estate across the U.S. and globally is in the hands of equity and pension funds, real estate invest- ment trusts, and other institutional inves- tors, many of whom lack time and expertise to do all that's necessary to effectively man- age their properties. Institutional owners with Hartford area and Connecticut real estate are who Sentry Commercial and Com- mercial Property Advisors covet, Duclos said. In terms of property-management respon- sibilities, there are tenants to recruit and keep happy by ensuring the heat, air conditioning and lights are on when they're supposed to be, and that the grass is mowed in summer, and sidewalks and driveways plowed in winter. In return for those responsibilities, prop- erty managers like Commercial Property Advisors collect monthly or annual fees, typi- cally 3 to 5 percent of a property's yearly gross receipts. Brett Watson, a Commercial Property Advi- sors manager and Levin's "right hand,'' said that while firms like his mainly "monitor and protect the assets'' on behalf of landlord cli- ents, today those clients insist on more. They also want, Watson said, their assets efficiently managed, and that usually means cost savings. A typical Commercial Property Advisors- managed property, Watson and Levin said, is a 65,000-square-foot suburban medical- office building, with a fitness center and other amenities that make it accessible for long hours in a day. For brokerage firms, offering property management provides a revenue hedge against slumping broker sales and leasing. Brokers, too, who manage properties usu- ally have a leg up on the marketing when a landlord wants to lease or sell. Duclos and Levin said they are moving purposefully yet slowly with their consoli- dation. Among other considerations for the deal, they said, was that Sentry lacked expertise in managing properties. So, Commercial Property Advisors will continue to manage its property portfolio while simultaneously training a Sentry staff- er who will eventually assume responsibility for that function, Duclos and Levin said. Within a few years, according to the plan, Commercial Property Advisors will be fully absorbed into Sentry, whose broker staff, Du- clos said, so far are on board with the concept. "It's kind of a new barrier for us,'' he said. "It's more of a management challenge.'' DEAL WATCH Trinity's Hartford campus home nearly ready The new downtown Hartford campus home of Trinity College in Constitution Plaza just about has the final pieces in place and is ready for occupancy. Trinity faculty, staff and students have begun occupying portions of the approxi- mately 7,500 square feet inside 10 Con- stitution Plaza, formerly home to defunct Back9Network and Spris Restaurant. "Only thing left is to put the signs up on it," said Timothy Cresswell, Trinity's vice president of academic affairs and the dean of faculty. Trinity is the latest college to establish a campus beachhead downtown, following the University of St. Joseph and UConn. Trinity was unwill- ing, Cresswell said, to miss out on the wave of offices-to-apart- ments conversions, the new minor- league ballpark and the city's push to commercially redevelop empty parcels adjacent to the ballfield. "We believe there is a need for Hartford to have a college-town vibe to it and to be part of it,'' he said. Beginning the last week in January, when classes resume after the Christmas holiday, Trinity will hold its first courses at its downtown campus, Cresswell said. One of 10 Constitution's occupants will be the college's Liberal Arts Action Lab, a partner- ship between Trinity and Capital Community College, which is based nearby at 960 Main St. As part of their coursework, participat- ing Trinity-Capital students, Cresswell said, will collaborate with area nonprofits to try to improve qualify of life and facilities in the city's major neighborhoods. Also based downtown, he said, will be Trinity's legislative fellows program, as well as "career coaches" drawn from the colleges' faculty and students to advise high school students and others about careers in sci- ence, technology, engineering and math. Aside from 10 Constitution Plaza, Cress- well said Trinity has leased about 13,500 square feet of third-floor space at 1 Consti- tution Plaza, to house its future certificate and graduate programs. Hartford showroom relocation The Mitchell Auto Group says construc- tion has begun on an expanded Land Rover showroom in Hartford's North Meadows. Mitchell officials said its Land Rover Cen- ter showroom-service center will occupy the former Baronet Coffee site at 77 Weston St., adjacent to the Xfinity Theatre. Mitchell's Land Rover Farmington Valley is currently housed at 95 Albany Turnpike/ Route 44 in Canton, said David Tefft, a Mitchell Auto partner and general manager. The existing 36,000-square-foot Hartford building will be renovated to accommodate the sales floor and offices, service depart- ment, and parking for new and used vehicles. All in, Mitchell's investment in its new Hartford showroom totals between $8 mil- lion to $9 million, Tefft said. It will employ 45 to 50 people when it opens by next August. After the move, the existing Land Rover showroom in Canton will house Mitchell Volkswagen. Mitchell's Land Rover plans actually mark a return of the legendary British sport-utility maker to Hartford. Tefft said Mitchell bought the Land Rover franchise from New Country Motors and relocated it to Canton more than two decades ago. Mitchell sells seven domes- tic and foreign automobile marques, primar- ily from stores in the Farmington Valley. Mitchell President Mark Mitchell said that sales of the British sport-utility marque have grown such that its Route 44 showroom re- quired expansion. Mitchell also said his desire to be closer to retailers of other luxury dealer- ships was a factor in the relocation. When complete, Mitchell will join more than a half dozen new- and used-car stores along "dealership row'' on Weston Street, including New Country Motors' Mercedes, Mini Cooper and BMW showrooms. PDS Engineering & Construction of Bloomfield is general contractor. R. Michael Levin, Founder, Commercial Property Advisors Mark Duclos, Founder, Sentry Commercial Trinity College's downtown-campus space at 10 Constitution Plaza. Artist's sketch of Land Rover Center dealership. RENDERING | CONTRIBUTED PHOTO | HBJ FILE

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