Commercial Real Estate Brokers – Why You Should Target Tenants in Your Prospecting

In commercial real estate brokerage leasing and sales you can find plenty of leads and opportunities when you target building occupants in a regular and ongoing way.  Research your listing territory by building and then split those buildings up into tenants and businesses.  Make direct contact.

Some business segments and industry types will be under pressures of change at different times during the year.  Local economic circumstances and business sentiment will drive property change for some businesses and industry types.

The Canvassing Process

Assuming you can get this process underway, here are some concepts to feed into the commercial real estate canvassing process:

1. Their business intentions – When you take and review all the tenants in a location, many will have future intentions to feed into their movement and growth plans. Customers and staff all place pressure on a business and with how things are done.  In a manufacturing segment where industrial property is involved, property configuration and use also rises to the top of the ‘planning’ list.  Most property decisions are made just before or after a change of financial year.  If you stay in regular contact with business owners and leaders, they are likely to remember you when a property challenge or change arises.
2. Factors of expansion and contraction – Some businesses need more or less space. Canvass your territory every day and look at how some businesses seem to be trading.  If the property is of an industrial nature you can usually see pressures of change and occupation in and around the property.  Observe what you can.  Ask plenty of questions.  Meet more local people.
3. Relocation requirements – Some businesses need to be located close to transport, highways, raw materials, and customer markets. Find out how those factors integrate into your location and property types.
4. Difficult landlords – Some landlords are notoriously challenging and unsupportive of tenant occupancy and comfort; those landlords can focus too much on rental returns and less on property performance. Over time that can lead to a general exodus of tenants from a property.  Look for tenants that are disgruntled with the landlords in property ownership.  Check out locations for distressed tenant mixes and properties with higher vacancy factors.  There will be reasons for issues like that happening.
5. Occupancy costs – Every tenant is concerned about paying rent and other occupancy costs. You should know what the rental averages are for a property and a lease by property type and location.  If a property is aggressively rented, the vacancy factor is likely to climb over time.  Distressed tenants are likely to move.  That then is a leasing prospect and opportunity.

Look further into buildings, tenant lists, property occupancy, and business activity.  You will always find leasing opportunities with tenants wanting to change location.