In commercial real estate agency and brokerage you need personal goals and targets. They show you the ultimate path to better clients and market share.
All of that sounds logical, and yet so many agents give ‘lip service’ to the process and never really get it going. They let the days and weeks pass without much focus. They let the business ‘happen’ rather than ‘directing’ it. Over time this then means less listings and volatile commissions.
Let’s say something very positive here from the outset. The commercial real estate industry is one of the most rewarding industries you can work in. It does however require complete focus and directed action. Those that don’t do that really do struggle. Struggle then creates stress and a downward cycle of business. You don’t need the pressure!
If you want to dominate your territory, town or city as a ‘top agent’, then goals and targets are required. You can then set action plans and implement them every day. That’s how you build market share and attract more listings your way.
Here are some goal creation considerations for agents and brokers:
- Look at the growth of property activity in your local area. How has it changed? What are the predictions for the future? Are you able to tap into the growth segments? What knowledge will you need to get into those segments of the market? Positioning and targeting are critical issues in our industry.
- Assess your competition when it comes to local sales, leasing, and property management appointments. How and why have they won that business? Are they dominating their market for some reason? Can you replicate their actions? Can you be better? Stand out as the better alternative in real estate agency.
- What marketing systems are being used locally with new and top quality listings? Are the other agents marketing listings differently in any way? Can you create a better marketing process in sales or leasing? It is best to be different and direct when it comes to property marketing today. Every property that you take to the market today has to stand out as a quality well marketed listing. Put yourself and your listings into the process. Stand out as a top agent that gets involved. Take your exclusive listings to the market personally.
- What are the growth considerations in the local business community and the population demographic? How can you work with that?
Given all of the above, take those facts and shape them into your prospecting and action model. Set the right targets with exclusive listings, commissions, inspections, and clients. You hold the keys for any success in your market. Get active. It’s a personal thing.
In commercial real estate agency, the property investors that you know well and connect with regularly will provide you with lots of opportunists in sales and leasing activity. That being said you really do need to know their focus and priorities when it comes to property ownership and overall performance.
The property market changes frequently and so will the plans of the people and clients that you serve. A lease transaction today can be a sales transaction tomorrow. The same extended business opportunity can occur from a lease deal to a property management appointment. Understanding the client will help you find the right opportunities and leads.
Here are some questions to ask your clients and prospects. Adjust the questions and concepts to suit the property type and local market that you control.
- What type of property do they prefer to own and in what location? They may relate more to industrial, office or retail property. Their preference will have an impact on your prospecting activity.
- What do they own now and how long do they intend to hold that investment property? There are strategic differences between holding a property for the short term (5 years) versus longer. Any leases that are negotiated in a property will be established with due regard for the investment holding period, the cash flow required from the investment, and any renovation or relocation needs.
- The income that you set for a property will be relative to the market rental in the property type. What do they know about gross and net rent today? What impact will incentives and vacancy factors have in the leasing process and returns over coming months and years?
- Will the property need renovation soon? Some older properties will reach the end of their useful life as tenants look for better property improvements and locations. A repositioning or renovation process will need to occur with older properties. Many property investors do not know how to position current lease negotiations for that. Renovation and relocation clauses can be inserted into current lease negotiations with due regard for the upcoming property changes. In such cases, the strategy of leasing really becomes very important.
- How are outgoings and expenses running for the property? Are they comparable to the other properties locally of similar type? Keep your clients property suitably positioned in a competitive way so that any lease can be attractive and viable for new tenants considering occupation.
Simple concepts like these will help you serve your clients professionally when it comes to tenant mix and leasing. When you get the balance right, the income for the property can grow and the vacancy rates can fall.
In commercial real estate prospecting you will get lots of ‘push-backs’ as part of talking to new people. Some call it the ‘rejection factor’. Many agents take the rejection and use it as a reason to stop prospecting.
Show me an agent that doesn’t make the cold calls and prospect every day, and I will show you someone with low income and poor listings. Get the message?
If you have chosen a career in commercial real estate, then be prepared to work hard at prospecting. The requirement will never disappear; in fact, it will increase in importance. Rise to the challenge and connect with more people. That’s what prospecting is all about. That is how you become a top agent.
So the message here is clear. Understand that rejection is a part of connecting with new people and in finding new clients. Some will not want to talk to you or meet with you, yet others will. You need to find the right people that want to do something with property or are happy to stay in contact with you for the day that they need property help.
To make all of this work you have to create a solid and effective prospecting system that you do for 2 or 3 hours every day. That’s the rule that you must stick to. Over a period of 3 months your skills in the process will improve and your conversions will rise. Soon you will have quality listings and the majority of them will be ‘exclusive’. When you control your listing stock, the market has to come to you. That is why ‘exclusive’ listings are so important to commercial real estate agents.
So what do people say to you when you prospect? What are the standard ‘push-backs’? Try some of these:
- Not today thanks
- Send me something
- Call me back next week
- We already use someone else
- Too busy to talk right now
- We are just fine at the moment
You can most likely add to this list. There are so many variations that you strike. Most clients and prospects will ‘push-back’ at least twice in a prospecting or cold call situation. You will hear versions of the above statements.
So what should you do? You should be prepared for the rejection. Practice your responses so you can keep the conversation moving ahead. The advantage that you have is that you are the person that made the call; you can be totally prepared to connect in a professional way.
It should be said that your call should be made on the basis of a conversation and not a pitch. Find out what the other person is doing now with property and what they could require in the future. Make the calls and the ‘door-knocking’ work for you in that way.
In commercial real estate agency, you will work with many different landlords. They will have tenant and rental challenges. You can be the leasing expert to help them.
Have you ever seen a landlord owner of a property that tries to lease the vacant premises themselves? They usually put a sign up in the window and drop a few adverts in the local paper; they then sit back and wait for a result. The vacancy then ‘eats its head off’ in lost rent and outgoings costs. The ‘hope’ process doesn’t work well in commercial and retail property leasing.
So let’s say that you are going to approach one of these landlords to see if you can list the property for lease. Only do so on the basis of an ‘exclusive listing’. If you don’t do that, the landlord is likely to market the property and the vacancy around you. Any tenants that show an interest may also try and get a lower rental from the landlord directly. Protect your efforts and your commissions with wise listing processes.
You have real value that you can bring to a landlord in this situation. As a leasing ‘expert’ you should have a comprehensive database of tenant contacts locally that you can refer the listing to. Your database is very valuable when you pitch for listings. Improve the value of your database by prospecting for tenants and buyers every day. Sell your leasing services around your database.
Why is it that agents take on ‘open listings’? It can be a method of quoting the property to your database if there is no other way of you getting a ‘foot in the door’. That is the only reason you should take on an open listing. Control your market with ‘exclusive listings’. That is how you dominate market share.
The leasing advice that you give landlords as part of listing a property (or pitching for a listing) should include these issues:
- Define the target market specifically for the vacancy. This will help you stand out as an agent of relevance.
- Show the landlord what is happening at the moment with rentals, incentives, leases and marketing.
- Get a list of competing properties together so the landlord knows what the asking rents are like locally.
- The time on market will vary from time to time during a business year. Track that trend so you can give the landlord some solid recommendations regards property promotion and marketing.
- Ask for marketing funds to use in the property promotion. Any landlord that is serious about marketing will participate in the request.
- Provide some marketing alternatives so the client can make some choices.
Your leasing recommendations should stand out as the best in the area. Use your database to show the landlord that you have a few tenants to take to the property as soon as it is listed.
In commercial real estate, and most particularly with the property agents and brokers, sales team performance should be optimised throughout the year to adjust for the changes in property activity and regional demographics. In any period of 12 months, the market will change and on that basis similar changes will need to occur with prospecting, listing, negotiating, and marketing.
It is wise to have a process of tracking the key indicators in your property market. When you consider an average period of 12 months, most property markets have only 10 months of real activity in sales, leasing, and property management. Seasonal changes and market conditions will take up the other two months of downtime. Team performance needs to be suitably handled and adjusted within the agency to get the best results from 10 months of hard work.
Here are some ideas to help you improve your agency sales team performance:
- Top agents and brokers specialise in particular market segments. The segments may be geographical, or set by property type. Either way, specialisation is recommended. Specialisation process helps you cover the quality properties, key clients, and pockets of high level activity.
- Establish a prospecting model within the agency that can be tracked on an agent by agent basis. That will help you identify any weak links within the team. Some agents need help when it comes to prospecting, presenting, or negotiating. The tracking process will help you see those weaknesses and implement the necessary training and education programmes.
- Establish budgets that can apply to each agent or broker. The budget should be split into key indicators. Those indicators will normally be cold calling, meetings, door knocking, presentations, listings, exclusive listings, inspections, and closed transactions.
- Track the results that you get from every marketing campaign. The results that you get from an exclusive listing will be very relevant to your business activity. Open listings are not easily assessed in the same way given that the marketing of an open listing is random at best.
- At the end of each week, have the agency team provide a summary of activity including call numbers, meetings, listings, and inspections. You will soon see the differences between the members of the team and how effective they are when it comes to building their business.
When you track all of these numbers, you can see where the priorities lie when it comes to each agent and each broker in the team. Given that the property market changes throughout the year, adjustments will always be necessary at an individual level to ensure that quality listing stock is attracted to your business.
So what type of listings should you chase and attract? Quality listings create better levels of enquiry and will sell or lease faster. Over time that will improve your agency market share and commission opportunity.
Should you walk away from a low quality property listing? The answer is yes, if it will take you away from the other good properties in your area and sales or leasing territory. Commercial real estate marketing is a specific process needing effort and focus. Don’t waste your time.
If you have a need for a new commercial property manager or perhaps a retail shopping center manager, is the training process of a junior person worth it or should you employ an experienced person for the required role? You can go either way but the strategy is different and your choice will have to do with the demands of the portfolio and your existing property management clients.
Here are some basic facts to be considered:
- Some clients require special attention and information. The property that they own may be very complex or demanding. A junior property manager will struggle and over time can threaten the stability of your agency appointment. They can also make costly mistakes and involve the agency or brokerage in a litigation claim.
- A complex and large property will have high workload demands; on that basis the fee for management should be suitably high to reflect the time and task input by the brokerage and property manager.
- The landlords that you serve will have special reporting and communication requirements. Every property manager should understand the financial reporting systems as well as the tenant and lease management systems to help with the reporting to clients. Each day the systems will need to be accessed to see if any critical dates or lease events are happening. Early implementation of critical dates will keep things under control.
In saying all of these things it is worthwhile noting that experienced property managers will ‘short circuit’ and ‘fast track’ any new property portfolio appointment; they will know what to do and how to get the job done. So there is a balance here between the salary costs of an experienced person for the role, versus training a new person.
The tasks controlled by a good property manager are complex; they are best described as including these bigger issues:
- Understanding the focus of the client is high on the list. When you understand the client you can adjust the strategies associated with income and expenditure. The same will apply with leasing and tenant management. The client will have needs of cash flow and plans for the property that should be understood. The reports that are prepared for your clients will be specialised to the property and the client.
- Strong and positive tenant relationships will help a property perform financially and physically. The property manager needs to stay in touch with all tenants in a positive and ongoing way. It is not an easy task and requires good communication skills on the part of the property manager.
- The leases for the property underpin the income and expenditure performance. For this reason the property manager must keep a close eye on the leases and the tenant mix. Stay ahead of critical dates with rent reviews, options, renovations, and other special lease terms.
- The maintenance of the property will have an impact on the tenants, vacancies, customers, and landlord cash flow. The property manager should monitor those things and make the right recommendations.
Should you employ an experienced property manager to your team? The answer is always ‘yes’, so you can get the professionalism into your management systems and client relationships. When you have a couple of highly qualified property managers you can consider training juniors to rise up through the ranks.
You can get more commercial real estate training tips like this in our Newsletter right here.
In commercial real estate agency, you need to be the agent of choice relative to the local area and the property type. The clients that we serve need to understand that they are working with experts.
Top agents build their profile continually through a prospecting and networking process. You need to do the same. About 1/3 your business day needs to be devoted to this prospecting activity.
So let’s say that you have connected with a client and you can see a potential listing available for conversion. Give the client some real reasons to choose you as the best agent of choice. Here are some ideas to help with that:
- Meet the client at the property to inspect it together and prior to you creating any proposal or listing presentation. This will allow you to question the client on the history of the property and the current challenges. You can also identify any concerns that they may have when it comes to achieving a sale or a lease in the current market. From all of this information you can construct a very well-targeted property proposal.
- Use a checklist for the property type when it comes to the client interview and the property walk through. The checklist will help you with important and relevant questions, and also show your professionalism to the client when it comes to the potential listing.
- Your personal profile on the Internet relative to the local area and the property speciality needs to be well established. The client is likely to check your name and or your agency online as part of making their final choice of agent. For this reason, you should have a business related blog that relates to your market and the current property trends. The blogging process only takes a small amount of time. You can write a blog two or three times a week about the local area and particular property activities. You can then link your blog to your social media activities and profiles. You can also link your blog to your newsletter e-mail activities.
- Grow your database at every opportunity. Over time this accurate and up to date database can be a clear advantage and give you leverage when it comes to winning a listing. Show the client the size of your database and its relevance to their property listing. You may even choose to short list a number of people from the database to take to the property as soon as the listing is approved.
- Get plenty of signboards into your local area. Signboard presence is still a tool of leverage when it comes to winning a listing.
A successful commercial real estate agent will take simple steps like these each and every day as part of their business building activity. The systems that you create will help you move ahead to a greater and more successful market share.
You can get more commercial real estate training tips in our newsletter right here.
In commercial real estate agency it is wise to plan your prospecting efforts and actions. On an average working day many different things will put pressure on your prospecting. Unfortunately many agents will drop the prospecting activity for the slightest reason. Over time that single choice will have a major impact on the way they grow their business and market share.
So you have some choices here:
- You can grow your real estate business and market share through directed effort each day on a client, property, and street by street basis, or
- You can randomly make calls and contacts if and when time permits.
The comfort zone is a big challenge for many agents and it will slow their listing chances and commissions given half a chance. When time gets tough, keep prospecting and stick to your plan.
To solve all of these issues it is best to have the prospecting plan that gets you in front of more property investors and business owners. It has to be specific and relevant to your property market and sales or leasing territory.
Not everyone that you talk to will want to do business with you or even discuss property issues; that is quite OK as you really should not waste you valuable time on people that do not have a need or and interest. Talk to more people and build your skill in doing so. Over time that one single fact will help you in so many ways to become a top real estate agent.
Many new brokers and agents to the industry struggle with finding clients and prospects to talk to as part of prospecting. The soon know that growing market share and commissions depends on one thing only and that is prospecting; when they get focused on it they also soon know that prospecting is a complex and dedicated process.
Here is a prospecting plan for you. Expect it to be a challenge to your diary and daily activities.
- Get to know the streets and businesses in your primary sales and leasing territory. On a street by street basis, identify the property owners and the businesses in occupancy. Talk to both. Find out what they are doing in property now and in the future.
- Review the other listings in the area that are listed with other agents. Use those listings as reasons to talk to other property owners and businesses in the same street and general location.
- Check out the old sale records for your region. Find those property owners that purchased property about 3 or 4 years ago. On average those property owners are going to be the next to come back into the market in some form or another. Connect with them for that process.
- Every property listing that you have on your books will be an excuse to talk to other businesses and investors. Use your quality listings in this way. Over time your current listings will give you more leads and information to act on.
- Walk the streets in your property precinct. You will find and see information that you can work with. Take plenty of business cards with you to leave at the reception desks, and with the business owners that you see or drop into.
- Use the telephone to make plenty of cold and warm calls to your market and business owners. Track your progress and your calls with a good database.
Prospecting in commercial real estate does not need to be hard but it does need to be systemised. In that way you can steadily improve your market share.
You can get more commercial real estate training tips in our Newsletter right here.
In commercial property management it is easy for a manager to get tied up in the daily events of the property and the client. Quite soon they are just doing a job rather than providing a professional service. The pressures of the job soon take over and the ‘bigger’ picture of property performance gets lost in the events of the property.
Quality property performance and control involves a forward looking approach to the asset given the market conditions, tenant mix, and property improvements. Strategy and timing are everything in the services to be provided. The property manager must have the discipline and the skills to do the job well; that involves a good fee and the right person for the job.
So many local property brokerages and agencies claim to be the ‘best’ at what they do in managing a client’s commercial or retail property. If that is the case then they should be able to prove that they are indeed the ‘real deal’ when it comes to quality property management services. Quality and accuracy are key components of the services to be provided. There are real differences between the services provided in office, retail, and industrial properties. The property manager should understand each and be proficient in one or more based on experience.
Why do I say this? It is a fact that many commercial and retail property managers are overwhelmed with daily work due to the demands of the client, the size of their portfolio, and an imbalance in fees for service. Many agencies set lower management fees just to get the appointment to the property. Those fees then have little relationship to the requirements of the client and the increasing demands of the property and tenant mix.
So the ‘golden rule’ in pitching for a property management is to understand the package of services that will best suit the client and the property. If you apply your fee assessment on an ‘industry standard fee’ as a percentage of passing income, then track that back to the work required and the size of the property and tenant mix.
Here are some other facts to add to the assessment:
- Client focus in the future of the property
- Property performance challenges from the leases and the tenants
- Vacancy profiles and upcoming leasing challenges
- Long term plans for the property including renovation and refurbishments
- Tenant mix changes and lease critical dates
- Cash flow requirements from the rental and the outgoings
- Property improvements and maintenance
- Targets in rent, operational challenges, leases, maintenance, and reporting
- Business plans and tenant retention
- Tenant lease negotiations
There are some real facts and issues to be managed here. A good property manager chosen for the property type will understand how to do that. Balance your client’s fee for service against the time required in management and the challenges of the property.
You can get more tips like this in our weekly newsletter right here.
In commercial real estate it is easy to spend too much time with current clients or prospects, and little time in finding new ones. When this happens your leads and listings tend to slow and will eventually stall. For this reason you must have some systems on the go that will help you find more new clients.
There are always new people to connect with in our industry. The ways to tap into them are simple and yet systemised. Here are some tips to help you with that ‘client growth’ requirement:
- Look for pressure points within the market. Some property owners will be experiencing tenant changes, higher vacancies, renovation pressures, and financial changes. The list goes on and will change during the year. Look for the clients that need help in adjusting to prevailing market conditions.
- Track the other real estate agent boards for both sales and leasing. When they put a new board up on a property, you should contact the owners around it and in the same general area. There is likely to be another property owner nearby that would like to compete with the existing listing. You can help them with that ‘competition’.
- Do a street by street canvass through your territory. Meet the business owners and track down the property owners. This does take an organised process but the rewards are many when you stay fixed to a system of contact.
- List quality properties as a general rule. The quality properties will give you better rates of enquiry from buyers and tenants. When you control the listings you control the enquiry.
- Offer special marketing solutions that are unique and relevant. These marketing solutions will help you when it comes to presenting and pitching your services.
- Build a database of relevance. It is very hard for a client to ignore your database if it is strong and large. Use your database as leverage in your presentation to the client. Show the client the size of the database and give them an indicative ‘short list’ of potential people you would like to quote their property to when the listing is signed.
- Referral business will be available when you connect with the clients and contacts that you have served well in sales and leasing.
- Ask for property management business from those clients, buyers, and landlords that are involved with sales and leasing activity. A great sales or leasing outcome is a reason to quote your property management services.
There are always new ways to get clients. Some will work for you and others will not. Decide what you can do in that regard and adopt a daily process to build your database of clients.