In commercial real estate today, it pays to undertake the necessary market study before you open the commercial real estate office for trading. Preparation will help you attract the right market of clients and prepare the right resources to drive your business forward. Your marketing plan should form part of your business plan.
A successful commercial real estate office will be built from a fine balance of resources, and the right people. Regrettably is somewhat hard to get good people to work in the industry at a high level for a long period of time. It is notable that there are fewer top agents in comparison to ordinary agents. The ratio is probably 2 in 10.
This leaves the opportunity wide open for ordinary agents to move to the top of the industry providing they establish solid performance systems. The proprietors of real estate agencies and businesses require top agents to give stability to the agency and grow the commission base. Whilst it sounds obvious, it is harder to achieve. The proprietors of commercial real estate agencies are always on the lookout for top agents or those people that can be shaped into that level of performance. It takes a person with a particular mindset and drive.
Here are some tips to establishing your marketing plan for your commercial real estate office:
- Determine the size of your market geographically. Ensure that the area is realistically comprised of quality properties and potential clients. Within that region, you can identify the history of transactions over the last few years. Ideally you will be looking for an area that is under change or expansion. Given that the commercial real estate industry is based around local business occupancy, you should also incorporate the review of local businesses into your initial market study. Look for an area that has a vibrant business identity and future. Look for an area that has an abundance of quality properties or vacant land to be so. Look for and area that is growing or active.
- Within your defined territory, identify the property types that will produce the necessary commission for your business. It may be that those properties require staff specialisation. That is certainly the case when it comes to retail property and retail leasing.
- It is somewhat easier to build a new commercial real estate office from a base of industrial property sales and leasing. That is simply because the property type is basic and straightforward. It is also easier for you to apply relatively inexperienced staff to that property type. Over time they can then graduate into Office Property and eventually Retail Property if that strategy seems suitable and the market opportunity exists.
- The size of local properties will dictate the size of commission. That being said, it is necessary to target the right quality listings in the right locations from the moment that you open your doors as an agency. Exclusive listings will produce better quality commissions over time. Initially you may find it hard to encourage exclusive listings, although the attempt should not be overlooked. Initially you will probably need to accept open listings and have your salespeople work on that general stock. When you eventually achieve greater market churn and success, it will be easier to convert exclusive listings given that you will then have a track record.
- Undertake a competitor analysis throughout the region. Some of those competitors will be more successful than others. Identify the reasons for that success and determine the points of difference relative to each agency and salesperson. How will your agency compete against those competitors? What can your agency do as part of attracting new business? How can you pitch for listings against the established local agencies?
So these are some key ideas that can be merged into your commercial real estate marketing plan. Other local area factors should also be considered and merged into the plan.
Before you open the doors of your new real estate office, ensure that you are fully aware of the strategy that needs to be implemented and the staff involved in the process. You can then create your staff attraction process to find the right people for the business.