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.