The marketing process in commercial real estate brokerage should never be ‘generic’ with perhaps one exception and that is in the promotion of ‘open’ listings. ‘Open’ listings generally waste everyone’s time, and will usually only sell or lease through some factor of ‘luck’. You can’t base your commercial real estate brokerage business on ‘luck’.
How Are Listings for You?
Some agents and brokers will claim that they must list ‘openly’ because ‘that is the way the market is for them’ and the only way they can get new listings. Whilst I accept that fact initially for those agents that are very new to the industry, I will say that the best agents avoid ‘open listings’. They grow their profile and market share consistently over time so that the new clients and prospects locally will come to them to list properties for sale and lease. That is when it is really easy to demand ‘exclusivity’.
If the client really wants the best agent then they must accept the terms of engagement that the agent is offering. They are then your terms! Are you ready to package your professionalism and sell it?
Are You the Expert?
If you have a comprehensive and specialised personal brand as a local property ‘expert’, then it stands to reason that people will want to list their property with you rather than some other ‘random’ agent or groups of agents. Take a serious look at your personal marketing processes.
Taking this point further, your market share and listing conversions of an exclusive nature will largely depend on your ability to establish your brand as the ‘go to agent’ for your location and property speciality. You can and should invest more time in building your real estate image and speciality.
Here are some rules to help you do that:
- Your Listings – Understanding the point that I made earlier about ‘exclusivity’, make the marketing process very special and deep with all of those high quality listings that you are bringing in. It is difficult for other property owners and investors to ignore the activities of any agent with the best properties and the best marketing ideas.
- Other Agent Listings – If you are stuck for current listing stock, use other agent’s listings in a location to talk to local property owners and tenants nearby to any listing. Some simple questions and conversations will help you find the next listing in the same street or perhaps a business owner looking to relocate.
- High end marketing campaigns – Get some traction with your marketing by seeking and converting vendor paid funds. If your advertising efforts on any quality property are of a higher professional level than that of your competitors, you should be attracting the new business leads and enquiries very easily.
- The personal approach – You are the marketer of your business. You sell your services well then people will choose the agent that they trust and believe has the better business and market coverage. Is that you?
Simple marketing rules like these help you consolidate market share and listings as an agent or broker in commercial real estate. Follow the rules and grow your real estate business.
You can get more commercial real estate brokerage marketing tips in our ‘Snapshot’ eCourse right here.
In commercial real estate brokerage you have one or two directions to take. You can let the property market come to you with any leads or opportunities, or you can go out there and find the new business that is available. The latter is preferable.
Get involved with connecting with new people every day. Put prospecting at the top of the list when it comes to new business activities in your daily diary. Don’t let any person or career pressure divert your activities away from new business prospecting.
A common problem
All too often you see brokers and agents avoid the requirements of new business generation. They soon lose market share and fail to convert commissions. Here are some facts to be remembered about commercial real estate brokerage:
- MOMENTUM: It takes about 3 to 6 months of dedicated prospecting activity to generate some listing churn and commission flow. Many agents and brokers struggle to maintain the required prospecting momentum and organisation. That can be an amazing opportunity for the small segment of people that can keep things under control.
- KEEP THINGS MOVING: When the new business starts to evolve, don’t stop prospecting. It is very easy to slip back into a situation where commissions and listings are hard to achieve. Avoid the peaks and troughs of the industry by continually prospecting regardless of the business that you are currently generating. Understand the lead times between prospecting, client contact, listing conversion, and negotiating. I go back to the point that a time frame of about 3 to 6 months exists in the industry as an average business cycle.
- CONTACT LIST: The database that you create is perhaps the most important business tool that you will use. Protect your database and its information. Keep in regular contact with all the people within the database so that you know when they move to a point of action or challenge when it comes to local property.
- IMPORTANT CONTACTS AND PEOPLE: The relationships that you strike with clients should be nurtured and encouraged in a relevant way. Provide local property information freely and directly to the clients and prospects that you have identified. Free local property information will always be of interest to property investors, business owners, and industry professionals.
So the secret here is to develop a proactive approach to commercial real estate brokerage. There are always plenty of opportunities to be found, nurtured, and converted.
Local property investors and business leaders are always on the lookout for assistance when it comes to leasing, sales, and property management activity. Get involved with the people in your property community and maintain ongoing relevant contact so that you can build your database and grow your market share.
You can get more proactive tips and ideas in commercial real estate brokerage right here in our eCourse.
When you know what is going on in the commercial real estate market, you can adjust your business efforts into the things that show opportunity. You can also avoid the parts of the property market that are slowing and time wasting.
The best property agents focus on the best parts of the market; that’s the rule. By monitoring a few categories of activity you can see your place and efforts in the bigger picture. If you are a sales agent, that process is really important.
Look for these things
Here are some property factors to chase and monitor in your local town or city:
- Signboard counts – It is a valuable process to add up all the signboards on properties locally on a monthly basis. Differentiate between ‘open’ and ‘exclusive’ listings when you do that as there is a real difference between each from a market share perspective.
- Internet listings – Go through the internet listings each month on the same basis as the signboards. Understand how many listings there are for each brokerage and agent. Soon you will know exactly who the top agent is for the area from an ‘exclusivity’ perspective.
- Vacancy factors – The level of vacant property locally will be a good ‘barometer’ of business sentiment. Understand what is happening in the local business community as that will impact property ownership and occupancy.
- Time on market – How long does it take to shift a listing with a sale? Some listings are better than others so you will need to differentiate on quality of property as you assess these numbers.
- Prices per unit of area – When something sells, understand the price from the perspective of property type, location, and unit of area. From those numbers you can compare transactions across your region. Soon you will see the active and popular locations for investment and business occupation.
- Enquiry rates – It is always good to know what people are looking for when it comes to local property. Are the levels of property enquiry going up or are they falling? You can also relate that question to property types and locations. When a person enquires about a property, find out how they located you and what they are looking for by way of property.
- Best marketing methods – Some marketing methods are more successful than others. When you do a monthly marketing assessment from inbound enquiry you can determine exactly how you should market new listings and for what reasons.
- Best methods of sale – Understand the best sale methods for attracting buyers and creating inspections. It is likely that any quality property should be directed to a time based sale method such as auction, or tender. Put a bit of ‘urgency’ in the method of sale so that the buyers that are interested actually have to make a decision and take action by a close off date.
Do there are some good things that you can do here with tracking sales activity locally in commercial real estate. When you know what is happening in the property market, you will be able to take action on the most rewarding parts of the property market.
In commercial real estate brokerage today you will frequently be negotiating with property owners, tenants, and business owners across a number of different strategies and property requirements. The best negotiation outcomes are achieved through skill development and will be a combination of a number of things including conversation, feedback, listening skills, and presentation.
Improve your negotiation and listening strategies
Over time you can improve your strategies with each element of commercial real estate negotiation, however you can fast track your negotiation skills through practice and personal development. Here are some ideas to help you with listening skills in any presentation, listing pitch, or negotiation:
- Choose the right place – wherever possible, choose the correct circumstances and the right place for the negotiation. Remove distractions from the process and the place. As a general rule, always negotiate directly one on one and in a face to face environment. Privacy is essential and confidentiality should be preserved. Get away from noisy situations, congestion, and other people. Choose the right place for the negotiation based on the parties and the property.
- Timing is important – whilst you may have a lot of things to say as part of the property negotiation, the timing of the process is very important given that you want other people to listen, interpret, and agree. If you believe the other person is under a degree of time pressure, then choose another time to extend the conversation into deeper issues and potential results. You want them to listen to you and absorb your recommendations in the right way. You want them to give you feedback as part of that process, and in moving towards a potential agreement.
- Look at the other person – as part of the property negotiation, presentation or discussion, ensure that you are completely committed visually to the other person, watching them as they talk and explain their position. Acknowledge what they’re saying, and restate any information that may require a further qualification or interpretation. You will also see elements of body language as they speak to help you fully interpret what they are saying.
- Control your emotions and feedback – don’t overreact emotionally as part of the property discussion and communication. Show your foremost respect of the other person and what they’re saying through controlled feedback and lower levels of emotion. You can be quite confident and involved in the property communication or negotiation, but you do not need to be emotional. Emotional involvement drives irrational comment. That can be a great danger in any property discussion and can be misinterpreted. Be patient and don’t interrupt when it comes to connecting with the other person.
Simple strategies like these can help you with client communications and property presentations. They can help you with lifting your conversions and negotiation results. Over time these factors can be practiced and improved.
On a final note, every commercial real estate negotiation should be documented with appropriate notes. Those notes can help you at a later time refer to the critical elements of the discussion and the outcomes.
When you are to lease a commercial property, the facts about the property and the leasing process should be at your fingertips. Tenants will ask you plenty of questions as part of the property inspection and enquiry process. Lack of information can slow down or derail a property lease negotiation.
You may only have one opportunity to convert your tenant to an inspection or a negotiation. So it is important to remember that preparation is the key to converting more leasing activity in a positive way. I like to do a lease orientation in preparation for that tenant attraction process.
Let’s face a few facts about property leasing:
- Every tenant will have different demands
- Every landlord will have specific ideas about rental, lease terms and conditions, and occupancy
- Some modern and new office or retail properties are very complex when it comes to lay out, fit out specifications, and the as built factors of design
- Property improvements, services, and amenities differ significantly from location to location
So there is plenty to think about here if you are the leasing agent. There are a lot of things to understand, look into, and review. Without capturing the interest of the tenant, they will quickly move on to another property inspection with another agent. You will only have one short opportunity to interest the tenant in the property and the vacancy.
Lease and Tenant Orientation
Here are some elements of lease orientation that I recommend you undertaken as part of every vacancy assessment and marketing process:
- Size – Understand the layout of the premises and the vacancy. The size and the configuration of the floor plate will be critical to tenancy design and business function. Some businesses require floor plates that offer flexibility in office configuration and departmental interaction.
- Tenancy use – Every vacancy should be assessed so that the ideal tenant profile and permitted use can be decided. The existing tenancy mix within the property may also have some relevance to the vacancy and the new tenant selection. Understand the pressures and the priorities that apply in choosing the right tenant with the correct business orientation.
- Access and security – Understand exactly how tenants will move to and through the property as part of their business operations. Security today is also a factor of concern for many businesses as they strive to service customers and protect staff. The tenancy itself may have proximity card access within a certain zones and certain floors. Advanced levels of security help when it comes to attracting corporate tenants today.
- Fit out standards – Within certain buildings there will be a need to establish and manage the standards of fit out construction. In that way you can preserve the quality of the property and the presentation to both tenants and customers.
- Rents and outgoings – Set some targets when it comes to market rental negotiation. As part of that, you will need to consider the incentives that apply in the leasing process for the location and the property type. Do a full market assessment of rental trends and opportunities as they exist within the property type. Advise the landlord accordingly, and set some flexible rental ranges that apply to any potential lease, the associated incentives, and the terms of lease occupancy.
- Strengths and weaknesses – Every property will have certain strengths and weaknesses to be understood and worked through. The strengths can give you significant points of difference when it comes to marketing, inspecting, and negotiating. The weaknesses on the other hand will need to be addressed prior to any lease inspection or lease enquiry.
So there are some good things to be understood and optimized as part of the lease orientation process. As the professional leasing expert, you can get these things under control at the earliest stages of lease marketing and thereby improve the levels of enquiry, and the negotiation outcomes.
If you’re looking to win more commercial real estate listings and particularly those that you can convert to successful contracts and leases, have a serious look at your listing presentation and the points of difference that you promote as part of the presentation. Why are you special? Why are you better than the other agents? In simple terms you need to stand out as the top agent for the job.
Are you average or generic?
Far too many agents and brokers approach the listing process generically with little preparation and no strategy. A client then has little to choose from when it comes to better ideas and looking for a positive outcome. What can you do that is different and relevant to the property promotion?
A listing presentation is not all about providing discounted commissions and seeking low marketing funds. Discounts don’t attract results. The client has to spend money to make money, be it as part of a sale or a lease transaction. Your job in the property presentation is to help them see why that is important.
What does the client want?
The client wants results and the listing presentation you make should be designed to convey all of the correct facts in the right way. Help the client see exactly how you will connect with the right property people in the market in a timely way; those who will have a potential interest in the listing and occupancy or investment.
Here are some ideas to help your property presentation and listing pitch with the client, and to help them with interest and involvement:
- Split the campaign into time frames – A property promotion should be staged so that responses can be tracked and adjustments can be made. The stages are best set to the immediate property release (2 weeks), the inspection and negotiation stage (4 weeks), and the repositioning phase (4 weeks). You only need to move into the repositioning phase if the property has not created sufficient enquiry or inspections.
- Explain exactly who the buyers or tenants for the property will be – Clearly set out who the buyers and tenants for the property listing will be, and then tell the client exactly how you will reach directly into those segments of people or businesses.
- Show what competing listings are doing locally now – Use photographs to show the client the other local listings that are on the market now and explain what has been happening with enquiry in each case. How will your clients listing stand out around those other listings? What can you do in the property promotion that is special?
- Show specific tasks critical to the momentum – You are the property specialist and on that basis you should have some good ideas as to how you will make the listing stand out locally. Put yourself into the campaign with specific tasks and property market investigations. What can you do in the campaign that will create plenty of enquiries? Split those important tasks into your request for an exclusive listing. Put those tasks onto a time line for the client to understand what you will do, when it will be done, and why that is so.
- Get the client involved – There are things that the client can do as part of the property marketing campaign; get them involved. They could for example give you a summary of property history and ownership that would be of interest to the local community of investors or business owners. Interesting information will help your marketing campaign and your inspections.
These 5 simple strategies will help your listing presentation stand out as comprehensive and relevant to the property market today.
Brokerage activities in commercial real estate can be enhanced greatly by planning set targets for growth, and in taking specific actions at a team and personal level. To get anywhere in sales or leasing it is wise to put in place those systems early in any brokerage career or in the establishment of a new real estate office.
Plans can be implemented across client activity, marketing, and listings. Each week or month the set plans and trends can be assessed for progress. They say that any agent or broker that is not working to a plan is wasting their own time if not that of the brokerage; the observation is very real and correct.
Know Your Property Market
Here are some tips to setting the right type of plans and progressing comprehensively as a real estate agent in your location:
- Competitors: Understand all of the competitors in your location for both property speciality and market share. Check out all of the listings that they may have on the market today. Understand if the time on market factor with each and every listing seems to be short or long when it comes to the properties they are marketing and promoting today. Determine who out of all the agents in the location seems to be the most successful in achieving results and for what reasons. Can you approach the property marketing process with greater momentum or effectiveness?
- Commission strategies: When it comes to a sale or a leasing appointment, there will be averages in the location that apply to the commission calculation. Some property owners will have certain expectations on the commission to be paid for any sale or lease. Whilst you should not be the cheapest agent or broker in the location, the commission rate that you charge should be correct and within the averages for the amount of work to be applied. It directly follows that you should show the client how you will be tapping into the local property market and resolving their current challenge relating to property; that is where the commission equation for the work applied becomes very important. Most clients will be prepared to pay a reasonable commission for a top service; your listing presentation needs to comprehensively cover that concept; differentiate between your services applied to open verses exclusive listings. Any client making a listing decision based entirely on discounted commission is not the client that you neither require nor should act for.
- Points of difference: To compete aggressively in any commercial property marketplace, it is necessary for you to provide a significant and real point of difference to your clients from their perspective. Your point of difference has to attract their attention and help them resolve the sale or lease challenge that they currently have. What can you do that is significantly better or different than that of your competitors? What processor or strategy can give you the competitive edge in today’s property market locally? You will need to do a full market assessment to understand the strengths and weaknesses of every agent or broker and how you can move into that market.
These three simple points of strategic planning will help you understand the factors of the commercial property marketplace that will be challenging or full of opportunity. From that point of understanding you can make some decisions and start to implement your business plan in commercial real estate brokerage. One final comment should be made here and remembered; any plan that you create today in commercial property should be tracked and adjusted over time. Things do change over time and you need to see that requirement when it happens; be flexible and adjust.
There will be shifts and changes in the commercial real estate market throughout the year. Your plan and approach relating to listings, clients, negotiations, and market share should be adjusted accordingly. When you have a strategic plan that is well under way, you can track the results and see the changes that are required as the market matures and changes.
In commercial real estate brokerage there will be plenty of things going on each day around you as you see to drive more business activity in sales and leasing. If you are not careful in your business practices, small omissions and tasks will be overlooked and perhaps forgotten.
Common Factors to Control and Action Require Notes
Diligence on the job and specific task management systems will help you maintain a focus on the things that matter. Take the sales process as an example. Here are some of the most common issues that evolve each day from just doing your job:
- Checking up on listing progress – How is your property listing progressing online and in the newspapers from an enquiry perspective? When you know the enquiry rates you will know what is working from a marketing viewpoint. You can then ‘tweak’ your activities for each listing. Better results can then occur from the quality properties you have on your books.
- Talking to clients about their exclusive property listing – don’t let a listing sit on your books for too long without regular follow-up with the client. Tell them exactly what is happening with their property and how the buyers are responding to the marketing and the inspections.
- Marketing updates and advertising changes – With some properties you will find that enquiry is limited; perhaps due to the property type or size of transaction. In cases like that you will have to specifically target your marketing and watch how the results are coming in.
- Taking new people through your listings – Any property inspection you undertake with a qualified buyer is just the start of things; a degree of shaping and encouraging will be needed from any enquiry. You will have things to talk about and follow through on.
- Taking calls regards property listings – When an enquiry comes in across the telephone there are matters to look into and come back on. Write things down and respond to the right people in a timely way.
- Chasing information for those people recently enquired or inspecting – To keep any property transaction moving ahead it is essential that information is sourced and responses are made quickly.
- Checking title and property detail – Some properties are quite complex when it comes to title detail and ownership structure. In many cases you will need to undertake a full and detailed review of the property structure and title information. Look for factors of concern and question any missing information. As you move through the checking process, make plenty of notes to help support further property investigation.
- Completing accurate contract documentation – To cover off on contract creation and accurate documentation, you will need to check out the fullest of property detail, the names and addresses of the buyer and the seller, plus the intentions of the parties when it comes to contract settlement. From that point you can then consider the creation of contract documentation and all offers.
- Following up on contract and settlement progress – When a contract has been created, it is the start of the process rather than the end of the negotiation. Every contract needs to be followed through to ensure satisfactory settlement progress. Some property contracts are very complex and will require specific actions and activities of the buyer and seller before settlement occurs. Always check up on the progress of your contracts and settlements. Take notes when it comes to issues identified or discussions occurring with the parties.
- Negotiation on a contract of sale – In any commercial property negotiation there will be points of discussion and disagreement to work through. Take notes as you progress through the property negotiation. Good notes will help prevent future disagreement or dispute. Those notes will also help you when it comes to any potential legal action that might evolve from the property transaction.
- Submitting offers to the right people – When it comes to commercial property, some of the transactions involve a number of people on both sides of the contract sale and purchase. Numerous conversations will occur and offers will be negotiated; disagreements and misunderstandings can also evolve. Conversations and meetings will move the property transaction forward and many things will be said. Write things down to prevent any disagreement or dispute. The notes that you take as part of the property transaction will help protect you in any potential legal action evolving from a disagreement.
- Prospecting for new business with clients and business owners – When you are actively prospecting for new business and clients, plenty of leads and ideas will come your way. Load the information into your database and or task management system so that you respond to the opportunity at the right time and in the right way. Don’t leave any lead or opportunity too long without taking the required action. Timeliness is an important part of commercial real estate brokerage.
You can quite likely add to this list, as there are just so many things that happen each day. As you talk to people keep a focus on moving a commercial real estate listing forward by tracking the tasks and the requirements of every conversation.
Mistakes and omissions cannot be made as you negotiate on a contract of sale; accuracy and timeliness are factors of importance in commercial real estate brokerage. The threat of litigation is always close by in the case of any errors or omissions that could be made, as will be the disappointment of losing a listing or commission. Focus on the correct tasks to keep your commercial real estate business pointing in the right direction.
Some agents may think that the need for listings is an uphill battle that never seems to go away. In part they are correct but the uphill battle gets easier when you follow the rules.
Confidence and systemisation are the key factors that help agents and brokers solve the pressure on finding and converting listings. In essence you must show all the people in the property market that you are the best agent in the area and with the property type. If you cannot do that now, then it is time to change a few things.
Here are some ideas to help you solve the listing battle and grow market share with real momentum:
- Relevance – It is a fact that relevance is the overriding concern that clients have when choosing an agent. The clients in today’s property market ultimately know that reaching out for buyers and tenants is not an experiment in property marketing, and real skills are required by top agents. The client will choose the best agent for the job. How do rank on the relevance scale? Why are you better than other agents and brokers? What can you do that will drive a top price or rent and better levels of enquiry to the listing? When you know the answers you have the foundation for converting more listings in your presentations.
- Pitch and present – Make your listing presentation meaningful and natural. Remove the hype and keep everything on a confident and natural basis. Remember that you are connecting with a person with property pressures; that person must be comfortable with your skills and property knowledge in ways that can resolve their property pain quickly and effectively at the best price or rent.
- Control your listing stock – When you list a property, control it through exclusivity. Any and all quality properties you list should be controlled in this way. Show the client exactly how you will comprehensively service their property if you are given an exclusive appointment. Work with up to 20 exclusive listings at any one time and in doing so, keep all your clients completely briefed on inspections, marketing efforts, and property enquiry. Information will always help in conditioning the clients to the market conditions.
- Market listings comprehensively – Make every exclusive listing the subject of a high quality vendor funded marketing campaign. Stage the campaign so it reaches out to the targeted segments of buyers or tenants, in ways that build inspection momentum.
- Encourage offers – When you have offers coming in from inspections, you have the start of the client conditioning and deal negotiation processes. Always get your offers in writing and support all offers with fully factual qualification of the parties, understanding that they can act in finalizing the contract or lease as intended.
To win the listing battle it is a matter of organising yourself to be highly committed to talking to lots of people in a regular and ongoing way. If you like it is a bit like disciplining yourself to undertake the commercial real estate business within a set of rules and guidelines. Get involved with your clients and your listings.
When it comes to working with any new client or prospect in commercial real estate, the quality of the questions that you ask will help you get to the point of the listing or marketing process effectively and directly. Direct questions will help you win new business, convert more transactions, and grow your commissions.
Many of the clients and the prospects that you talk to will initially be quite guarded or reluctant share too much information about the person situation. Trust is a part of client and prospect contact. That being said, you really do need to drill down into the real facts of the property pressure they may be experiencing. The questioning process gets a lot easier when you understand local market activities including prices, rents, availability, and time on market.
One factor to remember here is that you are the property expert for the local area and on that basis you are entitled to ask direct and meaningful questions. If the client or the prospect is reluctant to share their complete property situation with you, then you should also be reluctant to give out too much information about listings and property facts locally.
Direct Qualifying Questions in Commercial Real Estate Brokerage
Here are some questions to use to help you identify property needs and opportunities with new clients and prospects:
- How have they found the property? – Always try to understand how new people have contacted you to make the initial property enquiry. Over time you will soon see the methods of marketing that are attracting the right levels of enquiry for you as the agent or broker. Have they reached you as a result of and Internet listing, the property advertisement, signboard, or a referral?
- What do they know about the local area when it comes to prices and rents? – Some tenants and property buyers have unrealistic expectations when it comes to prices and rents. That will usually be due to their lack of understanding when it comes to the local area. If you are working with a client or prospect with that problem, you will need to show them some other properties where results have been achieved at established market prices or market rents.
- What other properties have they seen locally with other agents? Most buyers and tenants will be working with other agents simultaneously to satisfy their property need in a timely way. On that basis you can never really be sure as to what properties they have seen recently, or what they may be negotiating on right now. Be careful when it comes to the prospects you work with and the potential connection with another agent. The inspecting party, be they a tenant, investor, or business owner, may very well share confidential property information inadvertently about your listings to the other agent.
- Do they have a budget relating to property choice and negotiation? – The budget that they have set when it comes to a property purchase or rental should be questioned. There are other issues to consider as part of the budget that the prospect may have overlooked. In the case of rental, they may not have considered the recoverable outgoings in addition to the rental structure. In the case of price, they may not have considered the associated costs of contract including taxes, moving costs, and any special applications that may apply to property use.
- What is the process that will allow them to make the property decision? – Every prospect business or investor will have a process of negotiation and decision. Make sure that you are talking to the decision maker where ever possible. If you are talking to a company as a prospect, they may have a Board of Directors that need to be included or involved in the final property decision. That Board of Directors may also meet irregularly and therefore the final property decision could be delayed. When you understand the pressures of time and decision, the negotiation for your client gets a lot easier.
So you can ask plenty of direct questions and qualify the prospects people that you work with in commercial real estate brokerage. Drill down into the facts of the matter when it comes to their property selection, intentions, decisions, and needs. Take plenty of notes when you work with these people so that any information they give you today can be proven or discussed in the future.