In commercial real estate brokerage today the negotiations required for some properties can be complex and protracted. On that basis you should have an established negotiation management process to use at a personal level or within your real estate office. The process helps you and also the team leader or sales manager to understand the status of the current deals and the commission opportunities.
It is a sad fact that some agents are less experienced when it comes to complex property negotiations. On that basis the negotiation tracker can assist in deal momentum and closure. The sales manager or team leader can then closely monitor the stages of the deal and potentially get involved if closure is taking too long.
Here are some strategies to help you with a ‘negotiation deal’ tracker:
- The tracker itself should apply to the separate stages of activity in both sales and leasing. This then suggests that you will have a checklist specifically designed for property sales and another for property leasing. If you get involved with retail leasing, the complexity of that will also require a specific checklist.
- This process can help maintain control across deals and agents when the market is busy or the property is challenging. The levels of experience between agents can sometimes expose a brokerage to liability and indemnity risks. The checklist can help you from an insurance and risk management control perspective.
- A rule needs to be set that all deals will be documented in and processed through the negotiation checklist for the office. At the end of every working day the checklist should be updated by each agent for the deal and the client in question. In this way the sales manager can oversee the momentum of the negotiation and help with any hurdles that may be occurring.
- As a general concept, any negotiations should be soft on people but hard on the issue; don’t bring personalities into a negotiation, but focus on the issue.
- Every sale or lease negotiation will have documentary requirements to legally protect the client as they move to contract and on to settlement. Some agents will have a weakness when it comes to documentation; accuracy and knowledge are a challenge for some. The checklist can help identify those weaknesses and control the actions of individual agents. Again, this is beneficial from an insurance and risk perspective.
- A good negotiation should be a satisfactory outcome for all parties (including the agent on behalf of their client). The momentum to the process will be established through a sense of urgency and the professional skills of the agent.
In many respects you can improve an agent’s negotiation skills through ongoing training and role playing when it comes to selling or leasing the various property types. In any market and at any point in time there will be common problems of negotiation that pop up and require action; the weekly sales meeting is the best place to talk about them. In our industry you never really stop learning.
Closing the gap on any property negotiation should be the target in any property sale or lease scenario. Design a checklist involving the factors to achieve that control and directed momentum. The client will appreciate the professionalism, and over time that will help you with other business opportunities and referrals.