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DEALING WITH DOWNSIZE, SPACE-WISE OMNICOM GROUP, OTHERS HOWARD WENDY

By Published on .

Clients come and go, but agency real estate doesn't shrink to fit. That's why Omnicom Group has Howard Wendy.

Actually, the New York-based executive isn't with Omnicom, or any ad agency. And he doesn't work for Omnicom exclusively; others use the innovative thinking and deal-making he brings to the complex world of global real estate negotiation.

As executive managing director of Edward S. Gordon Co., a real estate brokerage, Mr. Wendy, 52, has negotiated deals in recent years totaling more than 2 million square feet in seven countries for Omnicom. His talents are so valued that Mr. Wendy is in constant contact with Omnicom executives, consulting on acquisitions and property problems around the world.

With his help, the holding company parent of BBDO Worldwide and DDB Needham Worldwide has kept the excess space in its 4.5 million square foot worldwide property portfolio to less than 90,000 square feet.

"He's one of the best negotiators around," says Jeffrey Resnick, director of real estate for Omnicom Group. "He has a real sense of whether a deal should be made and how to get there."

Comparatively, Saatchi & Saatchi Co. has said it expects to pay some $200 million for some 900,000 square feet of excess space during the next two decades. During the second half of 1994 alone, Saatchi expects to owe $15 million for surplus property payment.

Omnicom's excess office space is said to cost $2 million for all of 1994.

"Real estate expenses are the second-largest expenses after salaries," says Omnicom Chief Financial Officer Fred Meyer, noting that Mr. Wendy has "clearly been an instrument" in its aggressive consolidation of excess property.

In the '80s, Mr. Wendy rejected two Manhattan office projects that now house other agencies: the Worldwide Plaza, costly headquarters of Ogilvy & Mather and N W Ayer, and the Hudson Street development that's home to Saatchi.

But at a building one block from Saatchi, Mr. Wendy negotiated leases for Omnicom's Doremus & Co. and Merkley Newman Harty at about 30% of Saatchi's rate, said to be close to $40 a square foot.

In a move for New York's Katz Communications-and one for which he was nominated for "Deal of the Year" at his employer, Mr. Wendy convinced a landlord in danger of losing an empty building to cover Katz's old $30 million lease so the company could take 180,000 square feet in the empty facility. The deal will save Katz $10 million over five years.

"I'm probably a little too tough on landlords," Mr. Wendy says with a smile.

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