Executive-suites market strong in Boise area
Executive-suites operators keep making moves in a southwest Idaho business climate that market that seems well-suited to the small-on-space, big-on-service offering.
The suites are shared offices, for which a manager provides services. A business operator who has no employees can move in – after signing a lease perhaps just a couple months in duration – and immediately access secretarial services, conference rooms and other amenities.
Sources said the Boise area’s growth and strong small-business segment make it attractive to executive-suites operators, and that a number of major corporations go the exec-suite route here.
Suite operators’ recent moves include local player Capitol Business Centres relocating from the Boise Research Center to a larger space in the Eagle’s View Building on Riverside Drive in Eagle and also occupying 15,000 square feet in University Plaza across from Boise State University; Dallas-based The Regus Group leasing 16,500 square feet in the Banner Bank Building in downtown Boise; and Ventura Executive Suites setting up in the new Ventura Court building in Meridian’s El Dorado complex. Idaho Business Centre closed early this year at 404 S. 8th St. in downtown Boise.
“It’s not really a real estate investment as much as it is a service business,” said Tim Reid, principal in commercial real estate brokerage Grubb & Ellis Idaho Commercial Group. Because services are offered and occupant turnover can be high, active management is a must, he said.
A decade ago, when few executive suites existed in Boise, Reid and his father-in-law, Bill Bradbury, started Capitol Business Centres by renovating the Grand Army of the Republic hall downtown. They moved to the Boise Research Center in 2000.
Bradbury, now the owner, said at the outset he saw demand for small office spaces. He also realized he missed some aspects of the manufacturing company he had sold recently.
“I was used to the convenience and support of an executive staff,” he said. “We found ourselves in the executive-suites business.”
Capitol Business Centres Operations Manager Michelle Guyer said that Capitol’s market for full-service office space will keep growing as startup companies, and parties from out-of-state, continue to provide the foundation for new business.
Key Financial Center’s whole 10th floor consists of executive suites. They are about 95 percent occupied, Bill Hodges of Western Realty Advisors said recently.
Many executive-suites operators are tenants, but Hodges owns Key Financial Center and manages the Key Business Center executive-suites offering.
“We’ve got a nice group of tenants” in the suites, Hodges said. “It’s just working well for the building. A lot of companies want to cut their overhead down and just need one or two offices, especially startups.”
As a business grows, it will reach a point where remaining in an executive suite will not be cost-effective, said Professional Career Solutions principal Rich Davila, a tenant in Key Business Center. “We are right on that bubble now.”
But if Professional Career Solutions leases or buys other quarters, it faces costs including phones and high-speed communication lines, furniture, signs and staff, he said. Now all of that is provided, plus an address in a Class-A office building in the middle of downtown.
“Looking at the Boise marketplace, it’s predominantly medium-sized and small companies,” Davila said. “This business model (executive suites) works pretty well.”
Most small business owners, he said, are salespersons first and foremost; they need to be out visiting clients, he said. An executive suite often is an attractive alternative to working from home or leasing traditional office space long term, he said.
Davinci Suites opened about three years ago at Eighth and Main streets in downtown Boise.
“It’s full pretty much 90 percent of the time,” said Bill Grodnik, president of the company that operates in four states.
“It’s a very attractive environment for many kinds of companies,” he said. There are small businesses and professional firms as well as corporations “that use this environment all around the country.”
Demand for Davinci’s virtual-office product recently has grown substantially as more people realize they don’t need an office full-time. They can access phone-answering and mail service, and conference rooms, Grodnik said (more information: www.davincisuites.com).
Phone service costs about $150 a month, conference-room access $95, he said.
“Two-hundred and fifty dollars and you have a professional image,” Grodnik said.
That has just gone great in Boise. People have been attracted and some people go back and forth between having and not having an office.