http://www.nytimes.com/2006/08/02/realestate/commercial/02wifi.html? _r=1&oref=slogin
August 2, 2006 Square Feet Wi-Fi for the Building? Depends on the Landlord By ALISON GREGOR When the technology firm BlueSwitch needed new offices last year, it sought space offering wireless Internet access to minimize downtime during the relocation. BlueSwitch, a 20-person company that specializes in Web sites and Web- based software, needed to provide services to clients continuously when relocating from its previous office in Downtown Manhattan, so the firm took about 3,000 feet at 61 Broadway, at Exchange Place. Broad Street Development, the landlord, has been retrofitting the entire 653,000-square-foot office building for wireless Internet at the request of tenants. “We really had zero downtime,” said Alex Paskie, a co-owner and director of BlueSwitch. “We were able to access the Internet immediately, and even though we didn’t have furniture or soda to drink, we did have connectivity. For us, that’s the most important thing.” Other companies, however, may have more difficulty than BlueSwitch in finding wireless Internet access, particularly in Manhattan. Even in a business world where executives are increasingly mobile and working on laptops, most landlords say they have not experienced strong enough demand to warrant their investing in a system to provide wireless Internet in their buildings. Most tenants are satisfied with offices hard-wired with broadband Internet access, landlords say. “We have reviewed Wi-Fi, or wireless fidelity, a number of times,” said Robert Kantor, president of Time Equities, which has office properties around the country. “Our experience has been that Wi-Fi is used by people who are transient users, and even in our own office, where we thought about putting it in, there doesn’t seem to be a need.” The Rockefeller Group, another nationwide owner of commercial space, announced in 2003, when the technology was relatively new, that it would install wireless Internet access in five of its office buildings. The company has since backed off. “None of our tenants were really demanding it at the time,” said Brian Mahoney, a company spokesman. The Rockefeller Group does have Wi-Fi, however, in the sunken plaza of the McGraw-Hill Building at 1221 Avenue of the Americas. Some landlords have chosen to offer the service in lobbies or plazas to attract users to the spaces, said Stephen D. Heyman, president of Realinsight, which does project management for company relocations, including coordination of information technology services. “If you’ve got a plaza area, it’s a nice amenity to have,” Mr. Heyman said. Some huge mixed-use complexes built by commercial development companies in recent years have included multimillion-dollar infrastructures providing wireless services, but this service seems aimed primarily at potential buyers of very high-end apartments. The Related Companies, developer of the Time Warner Center at 10 Columbus Circle, which includes the Mandarin Oriental Hotel and luxury condominiums, and Vornado Realty Trust, which built 731 Lexington Avenue, between 58th and 59th Streets, which also includes luxury condominiums, have provided wireless service that goes well beyond Internet access. These wireless distribution systems, installed by InnerWireless, a company in Richardson, Tex., cost anywhere from 75 cents to $2 a square foot to put in — which could reach into the millions of dollars for a very large development. The antennas installed as part of such a system can be used with many kinds of wireless communications, like mobile phones and hand-held computing devices, which often lose signals in office buildings, along with two-way radios and public safety devices. InnerWireless has also provided wireless distribution systems for a dozen large companies in New York City and the surrounding area, though company representatives would not reveal names. When tenants need nothing more sophisticated than simple Internet access, however, many simply set up their own systems, and this may be dissuading landlords from making the investment, Mr. Heyman said. “I don’t think anybody’s looking for the landlord to do it,” he said. He said some businesses with frequent visitors or sales agents popping in and out might benefit from the convenience of wireless Internet, but its role as a technological advance might be minimal. “Over the years, buildings have set themselves up and called themselves ‘intelligent buildings,’ but you have to separate the whipped cream from the sundae,” he said. Gregg Popkin, a senior managing director at the commercial real estate brokerage CB Richard Ellis, said the current market for office space in Manhattan and some other major cities was so tight — with vacancy rates in the single digits — that landlords had no need to provide an amenity like Wi-Fi. “Years ago, landlords might have sought to incorporate this type of technology into their building and then sell the service back with a markup,” he said. Nowadays, the landlord might even charge the tenant for use of a building’s vertical riser to run the antenna needed to disperse the wireless signal. But typically, the landlord would not want to be involved in providing the service, because he “doesn’t want any liability if the system goes down,” Mr. Popkin said. Wireless routers can cost as little as $100, so many businesses install their own. For larger businesses, with 100,000 square feet or more, installing wireless Internet access might be less costly than hard-wiring all work stations, Mr. Popkin said. Still, Broad Street Development has received so many requests from tenants for Wi-Fi at 61 Broadway — especially smaller tenants ranging from 4,000 to 5,000 square feet — that in the future it plans to outfit all of its office buildings with wireless Internet, including a 296,000-square-foot building at 370 Lexington Avenue. “It’s an investment into the real estate, but what we’ve found is it sets us apart in terms of appealing to tenants,” said Daniel M. Blanco, executive vice president of Broad Street Development. The company providing the wireless Internet infrastructure at 61 Broadway, which is 33 stories tall, is Advanced Digital Networks, which typically charges $2,500 to $10,000 a building, said Tamer Zakhary, the company’s president and chief executive. While operating this system costs landlords nothing, other wireless infrastructures can have annual operating costs of 12 to 15 percent of the installation cost, he said. Besides Broad Street Development, Advanced Digital Networks has done work for New York City landlords like the Rudin Management Company, and for commercial real estate services companies like GVA Williams, Newmark Knight Frank and Cushman & Wakefield, Mr. Zakhary said. But, in general, New York City is said to be behind many of the country’s other large cities in offering wireless Internet to tenants of office buildings. “New York City is not even close to other cities,” Mr. Zakhary said. --~--~---------~--~----~------------~-------~--~----~ TELECOM-CITIES Current searchable archives (Feb. 1, 2006 to present) at http://www.mail-archive.com/telecom-cities@forums.nyu.edu/ Old searchble archives at http://www.mail-archive.com/telecom-cities@googlegroups.com/ -~----------~----~----~----~------~----~------~--~---
