Craig Ruoff
Executive Managing Director, Colliers International
Age: 51
Industry experience: 30 years
In his 30 years as a commercial broker in the suburban market, Craig Ruoff has seen the resurgence of urban workspaces and the recent uncertainty about the future of workspaces brought about by COVID-19. Specializing in the Fairfield and Westchester markets, Ruoff has represented clients such as Greywolf Capital Management and White Plains Hospital in meeting their space needs. As he joins Colliers following a five-year stint at Cushman & Wakefield, Ruoff is advising tenants and landlords on working through financial headwinds and rapidly changing corporate space requirements
Q: Joining a new brokerage during the pandemic, what was the interview and onboarding process like?
A: It’s gone incredibly well, considering everything that could go on. Once I joined Colliers people said, “How’s the new job?” I’m still working from home, but everything else is different. We are going to be the first Colliers office to open if it all lines up. But it’s been everything and I hoped for and more: the outreach from people and welcomes on LinkedIn and Facebook.
Q: What’s the latest plan for Colliers’ reopening?
A: I’ve heard talk either in the middle of August or possibly right after Labor Day. The reality is: Everybody’s working. Colliers is open for business. Craig Ruoff is open for business. The office is important, and it’s great with the setup and the community. The reason I wanted to go to Colliers was the culture and the collaboration. And that is the key element in everybody wanting to get the office back open.
Q: You must have known the team well already from your industry connections?
A: I’ve known [Market Leader] Jeffrey Williams for probably 30 years. I met Jeffrey when I first began working full-time in commercial real estate for William Pitt Commercial. I worked for a different team, but we knew each other and I was the new guy. He was very open and helpful to me. It’s a cutthroat business, but you don’t want that in-house. It doesn’t have to be that way out-of-house either.
Q: Are virtual office tours picking up traction?
A: Most of what I do is tenant representation. My first 10 or 12 years was with a company that did only tenant rep. After that I learned the value of representing landlords. What I learned over the years is I bring a unique perspective for landlords, having an in-depth knowledge of tenants’ needs. When I’m brought in to work with the landlord, not only with the acquisition of tenants but retention through this whole pandemic and horrible time we’ve been going through. The last three weeks or so, things started to come back to life. For several months when we were on hold it was a time of learning, not just about tenants, but you need to understand what the owner is going through. As much as they’d love to get tenant concessions, how are owners going to operate their buildings? They need to pay their bills as well.
Q: Is rent deferment as prevalent in office leases as retail?
A: What I’m seeing in the ‘burbs in Westchester and Fairfield is: not a ton. It’s a complicated process. The tenants have to demonstrate they’ve done everything they can do on their own, with PPP and other loans and assistance. They’ve got to demonstrate an actual financial need and open their books. You need to have a dialogue, and you shouldn’t just stop paying rent. I know that’s a tactic that people take. I don’t think it’s the right way, and I’ve seen it backfire and the landlords aren’t as open to talk to them. When we are able to keep communication open, we were able to achieve more. There’s a way to defer the hit on the landlord, such as using the security deposit to cover the rent.
Q: Is the downtown-to-suburbs office migration a legitimate trend?
A: There have been deals done and more people are kicking tires and exploring it, and with the residential relocation, you can only imagine the commercial is following. Companies are going to keep a presence in the city. It’s New York. It’s going to find a way to rebound and always has. We’re going to see more activity coming out of the city: the hub-and-spoke model, whether they have satellite offices or maybe they move the hub to the ‘burbs and have a spoke in the city.
Q: What changes are you seeing in companies’ requirements for square-footage per employee?
A: It’s an interesting topic because everybody is thinking we’ve all been working from home and people have gotten comfortable with that. There’s all sorts of studies. Some of the youngest people are having the hardest time working from home. They may have roommates. They may not have big houses in the ‘burbs. It’s hard. Some of the people of my generation, it’s not as hard. You have room for an office, but you may have kids at home who are working. I have a son who’s 21 and he’s doing an office internship remotely. I’m seeing more calls for downsizing. As we get through the numbers, the downsize is not as big as expected, because you need more room for people in the office.
Q: With the increase in sublease offerings, what do sublessors and sublessees need to be aware of that makes those transactions tricky?
A: Historically, subleases traded at fire sale dollars. Some companies only look at subleases because they know they’re going to get furnished offices, or it’s a good deal and it’s easier to get in if they want to move quickly. On the flip side, when you’re subleasing space, you have to be a little careful because you have to know who you’re subleasing from. If the company isn’t financially stable and they go away, you don’t have a direct relationship with the landlord. You don’t have all the rights. Even the approval process: Many leases have a recapture clause. I had a client years ago that needed to be in space quickly and we found a sublease, but there was a recapture clause and the landlord had 30 days to decide whether they wanted to take the space back. We try to eliminate recapture clauses so they’re not an obstacle. People historically have expected a bargain, but we’ll see. It’s a different climate. People coming out of the city may be comfortable paying higher numbers than we’re used to in our suburban markets. It’s still going to be a little bit of a discount.
Q: How do you characterize the diversity in commercial real estate and what are brokerages doing to attract and retain people of color?
A: I’m glad you asked. Years ago there was a mandate where schools had to have programs in place on the bullying front and the whole realm of diversity issues, and back then what people used to call “acceptance,” which we hated, because we don’t want acceptance, we want inclusion. My wife was the head of the Irvington [New York] Diversity Foundation that helped the local schools come up with plans. It made a real impact and created awareness and a template for people in other districts, to see that somebody was doing something and they needed to step up. Now with everything that’s being discussed, I know that Colliers is all over this. You can look around in the marketplace, and it’s not a diverse industry and it absolutely should be.
Ruoff’s Five Favorite Vacation Escapes:
- Mohonk Mountain House in New Paltz, New York
- Lake Placid Lodge
- The Sagamore Resort at Lake George
- The Weekapaug Inn in Westerly, Rhode Island
- Fairmont Chateau at Lake Louise
