Jon Rosenberg, co-founder and managing partner of Levrose Commercial Real Estate, fell into his career in real estate by chance. “I was a finance majorat the University of Arizona and, by happenstance, one of the classes I took was real estate,” says Jon. He ended up with a double major and received his real estate license in college. Jon then interned for two companies, including the company now known as CB Richard Ellis in Tucson.
When he moved to the Valley, he worked at a local commercial property management and brokerage firm for a few years before starting Levrose with business partner Bob Levine in 1992.
Levrose represents buyers, tenants, landlords and sellers of commercial properties, in office, retail, industrial and medical sectors. A sister company, MODE Commercial Property Management, handles the management of office, retail and industrial properties.
While most people follow and understand the housing market, the commercial real estate market may be a bit more complicated when it comes to gauging the success of a city’s economy. “When you see the housing market, in this case, strengthening, that often means that there are more jobs coming into the marketplace. Employers are adding more employees, so that absorbs a lot of the office, retail and industrial space.”
One of the areas of commercial real estate to pick up when the housing market gains momentum is retail. “Retail usually strengthens as housing strengthens, because obviously retailers want to be closer to where the people are living,” says Jon. “There’s a saying: ‘Retail follows rooftops.’”
While new construction may be great, why is it that so many strip malls around the Valley have so many vacancies? Jon explains that the vacancies can be due to owners “not being as aggressive or not maintaining the property as well as [they] should. Or, in some cases, there can’t be competing tenants within the same property. [You] can’t necessarily have a dry cleaner next to another dry cleaner.”
Many areas are also slowly filling back up in the wake of the recession. “What we are seeing this year is a lot of new office space coming on the market,” says Jon. “The office market is hitting a very strong occupancy and projects that started to develop a few years ago are now being finished.” And that’s a good thing. Jon is already seeing increased demand, so they should fill up quickly.
Many businesses are also trying to figure out where to locate based on their employee base. When it comes to offices, businesses are spending more time looking at being close to live-work-play areas – where there are good apartments, retail, restaurants and bars. Tempe and Old Town Scottsdale are experiencing this trend.
Levrose works with municipalities seeking to attract different types of employers to the Valley. The company is also part of a national alliance called TCN Worldwide Real Estate Services, which has offices across the country. “TCN works with commercial brokerage firms, so whenever they have clients looking to expand into Phoenix, they contact us,” says Jon.
Phoenix – and Arizona in general – is an ideal environment for commercial real estate. “We go down fast when things get difficult, but we come back quick,” Jon admits. “Things have really been ramping back up and the momentum seems pretty strong right now.”
Due to their success, Jon and his business partner decided in 2015 to make their firm a broker-owned firm. “A few of our top brokers have actually become partners,” says Jon. “Everybody gets to share in the growth; and other brokers will have the opportunity to become partners in the future.” He says that it’s a “fun way to grow – and then they have a vested interest in the growth.”
Jon also mentors others through serving on the board of the Arizona Chapter of Entrepreneurs’ Organization and the Real Estate & Finance Division of the Jewish Federation of Greater Phoenix. His best advice for a young professional wanting to get into commercial real estate? “Find a mentor and get with a firm that does some good training. It’s a commission business. Be prepared – it’s a marathon, not a sprint.” He adds that it’s worth it to successful brokers who have done it for many years, “but it starts off not so easy.”
One of the biggest benefits of commercial real estate is relationships. “You get to know different businesses, business types and business owners,” say Jon. “Commercial real estate is the backbone of most businesses.”