Cohen-Esrey’s business units provide integrated services for its clients, allowing it to use its financial expertise for the common good.

From its 1969 inception through the early 1990s, Cohen-Esrey’s niche in the real estate market was predominantly commercial leasing and property management. Since then, the Overland Park, Kan.-based company has developed more arms than an octopus. In fact, CEO Lee Harris, who has been with the firm since 1975, has been jokingly referred to by peers as “the king of LLCs.”

“We chose to pursue what I consider to be higher-margin types of endeavors,” he explains. “While we wanted to continue to build our core competency, we felt it was necessary to diversify, expand and leverage into other areas that plugged into our infrastructure.”

The company’s nine business units range from a tax credit advisor division to a medical properties division.

“We march to a different drummer,” Harris continues. “We’re not inclined to follow the herd. We like to provide premium service for a premium price, frankly. You’ll always find somebody who will do things cheaper, but I question if you can find anybody who can do it better.

“We still are a service provider in some respects with our property management operations, but we’re – to a great extent – a developer in a number of ways. We have specialized niches that we fill in a particular market where relationships are still extremely valued. Beyond that, we innovate a lot, and it’s difficult to be innovative in a commodity-type business such as leasing and brokerage.”

Saving Money
Harris says Cohen-Esrey has “extensive capital-structuring skills” that allow the company to finance properties it is either managing for a client or acquiring for an investor. Cohen-Esrey Equity Partners, its commercial property development and acquisition unit, recently completed its second condominium conversion project in the high-grossing Country Club Plaza in Kansas City, Mo.

“Everybody puts financing into place, but not many people go to the time and trouble that we do to secure multiple sources of funds to make a deal really work well and serve our overall mission to help people with affordable housing,” Harris adds.

“We layer more sources of funds into the equation than the vast majority of the industry, and, as a result, we can charge lower rent.”

For example, Cohen-Esrey purchases property insurance for its properties through a blanket policy.

“This is somewhat unique in that we’re able to customize the coverage for each of the individual properties, and we’re able to be tenacious in appealing property taxes and looking at economic factors that help a county assessor understand what the true value of a particular piece of property is,” Harris says.

Also, the Cohen-Esrey tax credit advisors arm has the necessary funding in place to acquire federal and state historic tax credits from anywhere in the United States. Harris says this unit intermingles well with the other sectors because, oftentimes, several Cohen-Esrey divisions can reap the benefits from a single project.

A Valuable Approach
Harris says Cohen-Esrey’s “value pricing structure” is another innovative practice. “Let’s say we have a 200-unit apartment community and we’ve walked onto the property to assume management responsibilities for an entrepreneurial owner,” he states.

“The first thing we do is walk through every single unit and look at it in terms of physical condition, location, view and overall desirability. We might wind up with as many as 200 different prices. Why does every one-bedroom apartment have to be the same price? They ought to be priced based on what the market thinks they’re worth.

“We can generate as much as 10 to 15 percent more revenue with this concept than if we just had a standard pricing model,” he continues. “[Besides,] you meet more people’s needs that way including residents, your client and your investor.”

He says the key to any company’s success is going the whole nine yards to understand what a customer’s wants and needs are. “A lot of companies focus on the competition,” he admits. “This is going to sound cavalier, but I don’t care about the competition. [I spend time] making sure that we are meeting the needs of our customers to the greatest extent that we possibly can.

“Information is the commodity now,” he continues. “It’s fine for somebody to come in and spout a bunch of stats and talk about the marketplace when they’re trying to win business.

“But when [a client] says, ‘But what does that mean for my property?’ it genuinely seems to stump people. It’s a superficial, shallow approach if you’re unable to convert what you’ve presented into real knowledge that provides value.”