The concept of the serviced office/executive suite now officially termed office business center occurred to World-Wide Business Centres (WWBC) founder and president Alan Bain, an attorney, forty years ago. The idea arose from his own difficulty in obtaining effective support services when working on client matters in cities other than New York, his home base. No services of the kind and variety he needed were readily available.
Quality hotels, Mr. Bain found, might offer guests a public stenographer, but rarely on short notice. Moreover, such work was never done from a guests room; and public spaces afforded no privacy a great inconvenience, especially when confidential issues were involved.
Mr. Bain, together with his wife, Linda Miller Bain founded WWBC to remedy this situation. Catering to the business traveller, the company was incorporated in November 1969. The revolutionary, fully serviced office business center opened its doors five months later, at 445 Park Avenue one block from where its New York office business center is now located.
Mr. Bain envisioned a chain of superior quality office business centers, operating globally under the World-Wide Business Centres brand name. Each would offer facilities, long or short term, including private office and meeting room rentals and such support services as shorthand, typing and telex.
On opening day, WWBC had two employees: Alan Bain and Dorothy Leiky Sabatino, an associate of Mr. Bains at both Levin-Townsend Computer Corporation and Debevoise Plimpton Lyons & Gates, the two organizations at which he had previously practiced law.
The Park Avenue facility offered three offices, a conference room, reception/work area, an IBM Selectric typewriter, hand-cranked pencil sharpener, Roneo duplicating machine, telex and rotary phones. Despite the special, introductory office rental rate of $150 per month, WWBC sat vacant for several months.
Happily, within the year, WWBC was a hive of activity. The original space was quickly out-grown. By the time WWBC relocated to its present address in 1974, the Park Avenue premises occupied approximately 5,000 square feet on three floors and featured 14 offices for rent. Howard Stark (who remained a WWBC client for over 25 years), and the actress Arlene Dahl were among its initial clients.
Thanks to Samuel Hockman, the real estate broker who negotiated WWBCs lease with Steinberg & Pokoik, the buildings owner, WWBC secured 8,000 square feet on the 10th floor of 575 Madison Avenue. Along with family angels, Joseph Wood of Bankers Trust Company granted WWBC an unsecured loan, making the relocation possible. WWBC will always be appreciative of Mr. Woods faith in WWBCs future.
The New, Expanded Offices
From its new Madison Avenue location, WWBC offered 30 rentable offices, only half of which were initially occupied. A coincidence brought to WWBC MasterCard and its administrative officer, Ken Adams, a former classmate of Mr. Bains at the Gunnery School in Washington, Connecticut, where WWBCs founder had been an English-Speaking Union Exchange Scholar. MasterCard needed short-term office accommodations for 16 professionals. For almost a year, the charge card company occupied every available desk and chair, validating WWBCs decision to expand. (Two decades later, MasterCard would return for yet another project.)
In quick succession, two adjoining spaces on the tenth floor at 575 Madison Avenue became available; and by 1976, WWBC had leased the entire 10th Floor.
Although Ms. Sabatino had by this time left her full-time position with WWBC to raise a family, she continued to work part-time on weekends, since the company had begun to provide weekend as well as evening support services.
WWBC Grows Internationally
In 1971, as a result of a promotional agreement with Peter Rosseti of the Business Travel Department of British Overseas Airways Corporation (BOAC), now British Airways, an office was opened in London at 97 Jermyn Street, in space shared with ManPower, the British temporary employment agency. The Jermyn Street location proved to be less than ideal, however. Hurriedly inspecting the proposed site on a Monday morning, Mr. Bain had failed to notice that the space was directly above one of Londons premier fish emporiums! (Traditionally, fish shops were closed on Mondays.)
The office was relocated a year later to 110 The Strand, the former offices of a leading Australian advertising agency. This space remained occupied by WWBC until 1991, when the office was closed. The London office, although small, had been a constant hub of activity, offering WWBCs characteristic, highly personalized level of service.
A Growing Support Staff
Barbara Perillo joined WWBC from IBM in 1971, as its third employee. Among her many accomplishments, she had finished second in a national speed typing contest organized by IBM. (To this day, many claim that she was faster and as accurate as the IBM Mag Card machine that WWBC purchased in 1973!) Joan Bell, the sister of an American that Alan Bain had befriended while at The Gunnery School, opened the London office business center later that year.
A New Phase of Development
The costs inherent in opening and operating the London office demonstrated that WWBCs potential for expansion, based upon capital, was limited. Accordingly, the company pursued overseas growth by licensing its name to similar organizations of comparable stature. In 1974, WWBC reached licensee agreements in Belgium, France and Switzerland and the following year similar agreements were concluded in Italy and the Netherlands. Last year WWBC celebrated the 25th Anniversary of the Swiss relationship and this year it celebrates the 25th Anniversary of the relationships in Italy and the Netherlands. (We are also delighted to see the second generation taking up the mantle from their elders in Italy and Switzerland.)
As a result of WWBCs expansion, the number of companies interested in entering into joint marketing and promotional arrangements with it increased significantly. Capitalizing on this increased interest in the industry and WWBCs preeminence in it, WWBC concluded a number of such arrangements. Over the years, marketing agreements were reached with such category leaders as American Express, Air India, Avis, International Airline Passengers Association, KLM Royal Dutch Airlines and Lufthansa.
WWBCs international expansion and pioneering role within the industry led to extensive press coverage. Articles about the company appeared on both sides of the Atlantic, in the real estate and travel trade press as well as in such leading newspapers as The New York Times, The Philadelphia Inquirer, Newsday, The Daily Telegraph, Financial Times, Japan Times and Asahi Evening News.
It was becoming increasingly evident, however, that the business traveller per se could not sustain WWBCs original business concept. That market segments need for office services was too unpredictable and the cost of reaching business travellers via advertising and promotion prohibitive. WWBC would have to reexamine its marketing strategy and broaden its target audience.
Enter the Global Economy
of the Eighties
The 1980s ushered in the global economy. This development forced even the largest companies to rethink the ways in which they were doing business, both at home and abroad. U.S. companies, the first to exploit the global economy, were reluctant to make the long-term commitments to people, space and fixed assets that were typically required overseas. Flexibility and short-term commitments became (and remain) a major business objective as did product uniformity, contract standardization and centralized booking and reservations. Large companies that first came to appreciate the benefits that the industry offered overseas began to seek out those same benefits in their domestic markets. Thus marking the true beginnings of an industry!
Even though the office business center industry was entering its second decade of existence, ownership was still highly fragmented. Multiple ownerships, to the extent that they existed, were mostly confined to single markets. To address the marketing limitations that resulted from this fragmentation and to meet the needs of a clientele of growing sophistication and clear expectations, organizations that brought together independent operators to market under a common brand were created. WWBC, anticipating these demands, had formed World-Wide Business Centres Network®, as early as 1974. It was the worlds first such organization. The Network began to expand rapidly in the 80s as a result of both member and client interest.
With its expansion, WWBCs Network was able to meet the growing need for its services, particularly from established companies, foreign as well as American, wishing to exploit opportunities overseas. The company retooled its marketing efforts accordingly, to accommodate this new reality. Sales offices were opened, not only in the United States, but also in Europe, and products were standardized to the extent possible.
The increased visibility and success that the industry was enjoying made the office business center concept attractive to real estate owners prompting their belief that the business was a ready made solution to the high vacancy rates that had resulted from the energy crisis that occurred at the early part of the decade and the stock market crash that occurred toward the end. Misguidedly, developers as well as institutional owners of commercial office buildings facing vacancies offered attractive terms to those that thought they saw an opportunity to turn a quick profit in the industry. Sadly, a number of inexperienced operators that entered the business with this foolish expectation went bankrupt adversely affecting the office business center industrys reputation for an extended period.
WWBC, with its headquarters in New York City, was unaffected by the downturn that resulted from the energy crisis. The impact of the stock market crash of 1987 was less benign, however. WWBC office business centers, opened in Miami and Philadelphia in 1985, were closed by the end of the decade at the end of their lease or by agreement with the landlord.
Notwithstanding, by 1982, WWBC had doubled the size of its Madison Avenue location. The facility, the largest of its kind at the time and for the next fifteen years, occupied 40,000 square feet on two contiguous floors, comprising over 150 private offices and employing over 30 in staff. Profits from the operation allowed WWBC to continue to focus on the development of its Network and its Brand
WWBCs Technical Innovations
To accomplish its expansion while continuing to deliver its trademark personalized telephone answering capabilities, WWBC replaced four cord-type switchboards with a Northern Telecom Private Branch Exchange (PBX) and took advantage of the liberalization of telephone regulations to run its own telephone company, reselling service, handling equipment installations and maintaining its system. What is now taken for granted was unprecedented at the time. Simultaneously, to accomplish its goals, WWBC developed proprietary technology to identify incoming calls and capture client billing information. Working with an outside consultant, WWBC introduced the industrys first Telephone Answering and Information Management System, as well as the first Call Detail Recording System both of which are now standard PBX features.
To herald the opening of the enlarged facility, WWBC convened its Network members in New York City. Special Mayoral assistant Herb Rickman stood at the top of the 10th floor staircase in October 1982, and cut the ribbon which officially united WWBCs ninth and tenth floor spaces.
Over the years, as its Network continued to expand WWBC assembled its Network members annually in such locations as Amsterdam, Atlanta, Helsinki, Lausanne, London, Milan, Mulhouse, Orlando, Paris, Philadelphia, Phoenix, San Francisco, Stockholm and Zurich so that expertise and product innovations could be shared.
Continuously Alert to Client Needs
As a result of findings from a 1984 survey of clients, WWBC acquired International Travel Bureau (ITB), a full-service travel agency. This acquisition permitted WWBC to offer a complete range of business and leisure travel services and, at the same time, gain exposure for the company and its international Network, by virtue of its inclusion as part of ITBs service package. The purchase of ITB proved to be well-conceived. By 1990, ITB established a new meeting services division then the fastest growing segment of ITBs business.
Leveraging its fifteen years of experience and successful track record, WWBC formed a facilities management company in 1985, WWBC Management Corp. (WWBCMC), to provide consulting and facilities management services to other organizations wishing to enter the office business center industry.
Consulting and Facilities Management
Wishing to open and operate an office business center in Tokyo, Jardine Matheson Company of Japan turned to WWBCMC for assistance. This consulting assignment, which included training sessions led by WWBCMC in New York City and Philadelphia, spanned a five-year period. Another important WWBCMC assignment was for actor Robert DeNiros Tribeca Film Center. Introduced to the project by Cushman & Wakefield, a national real estate consulting company, WWBCMC assumed complete responsibility for planning the Tribeca Film Center, successfully bringing the project to completion within twelve months.
In addition to these assignments, WWBCMC was involved in other consulting projects, both in Europe and the United States. The role continues.
Another Strategic Alliance
In 1987, WWBC made another strategic acquisition when it purchased Business World Office Network (BWON). BWON had developed a network of office business centers in the U.S. similar to WWBCs overseas.
Believing initially that it would ultimately open its own facilities in the U.S., WWBC had elected not to license its name in the U.S. However, experience persuaded WWBC that it would be difficult to raise the capital to realize this goal. This realization brought about a change in strategy that led to its purchase and assimilation of BWON.
To support the new acquisition, WWBC mounted a high impact promotional campaign on behalf of its newly enlarged Network.
WWBCs Directory of Network Locations, introduced in 1985, is now published at least annually. A Network Privilege Card, also introduced in 1985, was distributed to clients, highlighting the special benefits they enjoy within the Network. A member-sponsored advertising campaign launched in the International Herald Tribune in the mid-1970s was expanded to include the Financial Times, and eventually, The Economist and The Wall Street Journal as well.
WWBCs New Relationships
In 1992, WWBC established a joint venture in Europe with Dr. Urs Wunderlich, owner of its Swiss affiliate, International Office Services to expand its Network in Europe. Since then, the Network has expanded to include over 150 locations in 18 countries.
The following year, WWBCs New York landlord, Steinberg & Pokoik, also became a partner in the business. These new relationships freed WWBC to focus more aggressively on the expansion and strengthening of its Network. WWBC produced its first brochure dedicated exclusively to the Network. This four-color brochure replaced an outdated ten year-old version and supported other collateral material developed jointly over the years with third parties, such as American Express and British Airways. These had focused on the special privileges offered by WWBC to customers of those organizations rather than promoting WWBCs own expanding capabilities. WWBC also supported the development of a uniform brochure format for use by its European members.
The Nineties and Beyond
Beginning in the mid 1980s following the acquisition of HQ Business Centers, WWBCs principal competitor, by United Technologies and the significant investment in corporate advertising by HQ that ensued, the office business center industry grew dramatically. This pattern of explosive growth continued throughout the 1990s not only within the United States, but also overseas. Office business centers can now be found in Asia, the Middle and Far East, South America and Africa, in addition to North America and Europe. Real Estate Investment Trusts, such as CarrAmerica, Reckson and Equity Office Properties Trust, were prominent among the new ownership group.
Successful national and multinational companies, driven by globalism, competitive pressures and the need to exploit products with ever diminishing life cycle were increasingly attracted by the industrys cost-effectiveness, operating efficiency and flexibility. Such companies became an ever more important and growing segment of the industrys and WWBC Networks client base. Companies bringing cutting edge technology-based products to market and exploiting the Internet revolution were particularly attracted by the instant availability of a readily reconfigurable office environment that was supported by high speed Internet access, interconnectivity and permitted high speed voice and data communications. WWBCs Network not only facilitated their global expansion ambitions but did so at the speed at which they needed to move in order exploit their technical innovations.
The 1990s were also a period of nearly continuous corporate downsizing resulting from industry consolidations and outsourcings as companies sought to achieve maximum efficiency by concentrating on core activities. As a result, around the world, companies became cautious about opening up new divisions or introducing new products utilizing traditional officing methods. Real estate came to be considered a liability to be avoided thereby causing companies to seek innovative officing solutions. The functionally efficient office business center industry was ideally position with solutions in place to match those emerging corporate real estate needs. Teams spaces, work spaces, hot desks, hotelling areas, multifunction rooms and relaxation areas were added to WWBCs offerings as were high speed Internet access, video conferencing, and a full range of voice and data communications capabilities, all supported and managed by an in-house staff.
Trends favoring office business center utilization are expected to continue, as the cost and complexity of technology continues to escalate, personnel becomes more expensive to train and maintain and space needs became increasingly difficult to anticipate.
The Future is Now
The office business center industry continues to evolve. Globalization, speed, unpredictability, the virtual office, corporate downsizing and reengineering of the workplace as well as the telecommunications and Internet revolutions are impacting both the office business center industry and its clients. Until recently, corporate buyers viewed the industry as a cost effective but temporary solution to office and personnel support needs for a limited number and type of employee. Those views have changed. Corporations now recognize that the office business centers industry can equally meet their long term needs for a virtually unlimited number of employees, whether through traditional space utilization, alternative officing arrangements or in support of virtual and at-home office workers.
WWBC recognizes that, in order to fully realize its potential it must continue to accommodate the needs of this evolving marketplace. Accordingly, it is constantly reconfiguring space, innovating, gathering market intelligence, improving training and upgrading systems.
To keep up in the industry requires amounts of capital and levels of sophistication not historically available to and within the industry. This need for capital and increased sophistication is major reason why the industry has undergone a total transformation in the last several years. WWBCs two principal competitors through consolidation now enjoy multi-million dollar market capitalizations and, as a result, greater access to capital.
In order to remain competitive WWBC, too, has announced plans to raise private capital so that, it, too, along with its international Network, can respond to the changing demands and expectations of the market and better support its Network. WWBC also plans to open new facilities under either direct ownership or as a joint venture with the owner of the building in which the office business center is to be located. WWBC still expects to continue as a haven for those qualified operators within the industry that wish to remain independent but recognize the need to belong to a strong branded marketing organization to remain competitive.
WWBC has housed many outstanding clients over the past three decades. It has learned how to maintain its position on the cutting edge of the industry. It understands better than most how to run a tight ship and conserve resources, while still delivering a superior product. It continues to learn, grow and evolve to meet emerging needs of the international business community. WWBC looks forward to the future with the confidence and optimism that comes of success.
WWBC salutes the many distinguished individuals and organizations it has been our privilege to serve. We thank them for their patronage and for helping us to achieve a leadership position within the office business center industry.
We also pay tribute to members, past and present, of the WWBC family. The commitment and dedication to the company of our seven current managers alone represents a combined 154 years of unparalleled service.
Donald S. Radcliffe, 38 years
D. Edward Bungert, 33 years
Ellen Donohoe, 31 years
Liliana Vinueza, 26 years
Michele Piri, 26 years