In commercial real estate brokerage, there will always be plenty of new business to convert locally when it comes to upcoming and current property development approvals. Part of your prospecting model as a broker or agent should incorporate that focus on new developments, incorporating a real strategy and approach to the right people.
(N.B. these ideas are also sent out to regularly to our friends in Commercial Real Estate Online Snapshot to help amplify brokerage results…. Get your access here)
What’s coming up?
When you tap into a new or upcoming local property development, the business that you achieve can be ongoing and the listings can be numerous. A property development can incorporate a number of stages and premises to be marketed. That being said the ‘front end’ work to a property development can be extensive and take time, so be prepared for that ‘down time’. It is the longer term and bigger focus on the development outcome that is important; understand just how many listings and or commissions will come from the final project when it is active. Is the project for you?
As a base strategy to get this concept underway, you will need to regularly visit the local planning office to understand where current and new property developments are being considered and will be located. You can then inspect the property location and approach the property owner and or developer accordingly. Get in early on any upcoming property development.
Local Planning Office
Visit the local planning office at least once per month to review the minutes of the planning committee or planning approvals board. Understand how planning approvals are processed in your town or city, how long they take, and how the approvals documentation can lead you towards future listing opportunity.
Relevance is the key to converting leads and opportunities from and with property developers. A property developer will be inclined to use the services of the top agent who can prove that they dominate the market segment, and achieve the best results in a timely way. Is that you? How can you display that?
Here are some ideas to help. Remember the motivations behind any new property development and consider the following factors:
- Time on market will be a factor of concern for any property developer. They will need to know how the time on market can be shortened whilst they are still achieving the best levels of enquiry for the new property development and or premises. Show them how you will do that.
- Vacant land in the local area will always be a good source of property development opportunities providing there is a relevant demand in the local area and the zoning for the property is suitable. Merge vacant land ownerships into your prospecting model. Determine how long it takes to create a new property development, what could be involved, and how you can help the process and outcome for your investors and or developer clients.
- Redundancy in local investment properties will happen at any time in any city or town. Some properties reach the end of their serviceable use, and you can work with that. Businesses tend to move away from the older properties over time, and you can work with that. Those older properties can become renovation opportunities or redevelopment sites. Tap into the redundancy issues in your location.
- Change of use and zoning use will occur locally. Look for the decisions and the changes of property zoning as they apply in your town or city. A change of property zoning will usually create future property churn be it as a sale or leasing opportunity.
- Business migration and change are factors that we can always tap into. Look for the segments of the business community that are under pressure and change. Pressure factors can include business growth, expansion, contraction, or relocation. Connect with the local business community to understand where those opportunities will be occurring next and what those businesses will need to do.
- Property developers can be matched to local investors. You can be the creator of future of development business and property opportunity. You can find the parcel of land, the appropriate developer, and the business investor to take this project forward. Any new property development and redevelopment change will usually take two or three years to complete. You can be the catalyst of matching the three main elements to create that project opportunity. Work with the local property investors to understand where they are focusing and what they are looking for. Find investors (with the funds backing) that can work with those property developers and then locate the parcel of land to suit.
You can attract property development business in commercial real estate brokerage. Understand what is happening locally and then drill into the market segment. Talk to the right people to open up the enquiry and leads for new property projects.
(N.B. these ideas are also sent out to regularly to our friends in Commercial Real Estate Online Snapshot to help amplify brokerage results…. Get your access here)
Many agents specialise in just industrial real estate, be that sale or leasing. That focus can be a good thing because the industrial segment can be quite unique when you consider the factors of large manufacturing and warehousing.
When you are listing a property that is industrially zoned or perhaps already has an industrial use, you need to get to the key issues of the property and how it relates to other industrial properties locally. Comparisons will help you understand future opportunity and marketing potential for the asset.
Important Facts to Investigate
Here are some factors to investigate when assessing the potential of an industrial property from a sale or lease perspective:
- Zoning – There are differences in industrial zoning, and therefore the types of work, manufacturing, and or business that can be generated in an industrial site or warehouse. Check out the zoning regulations that apply to the location and the listing; understand what types of business and manufacturing can occur on the property.
- Orders or Notices – Some industrially located properties are impacted by factors of the environment and location. Ground water, soil toxicity, topography, and stored or manufactured chemicals are just a few factors that will impact the use and or occupancy of the property. Ask about orders or notices that may have been issued to control the way things happen in the property.
- Warehouse and building floor area – There will be locations in the property that are used in a specific way. The configuration of those particular areas may suit or typify the standards of a particular industry; that means some of those areas could be redundant to the next property occupier. Review the areas and understand them. Typically you are looking at the spaces relating to warehousing, office, laboratories, storage, power plants, machinery, production, loading bays, and hardstand. There may also be special requirements associated with the certification of plant and equipment such as cranes.
- Warehouse size and construction – Storage of goods today involves pallet stacking, forklifts, floor loading, and staging areas. Every industrial business will have factors that are quite special in the way they receive, move, and store goods. Clear span warehousing will help with the logistical factors of goods movement, pelleting, and storage. Modern warehouses tend to incorporate clear span design.
- Access – Most industrial businesses today require truck access and special loading and unloading facilities. The efficiency of the moving of goods can be a big part of cost control and customer service for any industrial business. A large loading dock and infrastructure will be helpful for many occupants of business types.
Given all of these things, a good industrial property will be situated in a location that is well supported by service infrastructure such as electricity, gas, water, roads, rail, and airports. Why not do your full property assessments before you decide on the best way to market the industrial property to attract potential buyers and tenants?
In commercial real estate brokerage, there will be plenty of pressures to handle and diversions to avoid. Through all of those things, you need to keep doing the deals, and on that basis you need to set some rules at a personal level.
One thing should be said quite clearly when it comes to getting things done in our industry. In simple terms, you cannot control the whole of the day; things will happen that will change your targets and actions. Be prepared for the changes, and control at least a part of your day regardless of everything that happens.
One Third of Your Day
As a general rule, you should be able to control at least one third of your day. To get more traction and leverage with clients and listings, that controllable one third of your diary should be at the beginning of the day. It should extend for at least 3 hours.
Start the day doing the things that really matter when it comes to commercial real estate. Determine exactly what tasks and opportunities will help you drive more new business and better client relations. In most cases, the cold calling and prospecting process undertaken at a personal level is exactly what you need to merge into that controllable one third of your diary.
Attract Fresh New Business In Commercial Real Estate Brokerage
Here are some rules to help you with attracting more deals and listing opportunities:
- Don’t book meetings in advance unless you completely understand and accept the reasons for the meeting from your perspective. Is there a client relationship or listing opportunity involved in the meeting process?
- Other people will want to see you or talk to you about business issues from their perspective. Connections with other people should occur at the end of the day when all other important tasks have been undertaken. Remember that you control your diary; don’t let other people do that.
- Over time, only list high quality properties on an exclusive basis. Control your listing stock through that exclusivity focus, and avoid open listing requests as they will waste your time. Only take on open listings when you know that you have a potential buyer or purchaser to match to the property. It directly follows that you should decline any client request for an open listing. Why would you offer your high grade professional property services on low-grade listings and therefore waste your time? When you understand and accept that you really are the expert agent for the local area, open listings are no longer a necessity or a requirement. Pitch and present your services in a comprehensive way so that the client can see that you are the top agent for the job.
- With every listing, pitch and present your marketing strategies to the client on the basis of a comprehensive vendor paid marketing campaign. Ensure that the campaign is well structured using unique and direct marketing processes that your competing agents may have overlooked or neglected to offer; put yourself in the marketing process. Whilst every marketing campaign will have a degree of general advertising and website listing commitment, tell the client exactly what you are going to do for them and the property to attract volumes of high quality enquiry at a personal level.
When you stick to the rules when it comes to property marketing and listing, you can attract more commercial real estate enquiries and opportunities over time. In simple terms that will allow you to attract more listing leads and commission or deal opportunity.
In commercial real estate brokerage, you will find challenges when it comes to every real estate team. The disciplines and business processes across sales, leasing, and property management will vary, and on that basis you need to know that every member of the team is implementing the necessary skills to serve the client base and improve the business.
Every brokerage principal or manager should be closely interacting with the client base to identify and determine any factors of under-performance or client concern. Invariably most clients suffering the effects of poor agency performance will tell others about their concerns before they tell the relevant agent or brokerage; over time they can do a lot of damage to the brokerage brand. It is common for a client to move on at the end of an agency term of appointment where the listing hasn’t been well serviced or communication with the client has been below par.
Whilst you may spend a lot of time encouraging the agents in the brokerage team to improve personal skills and strengthen opportunities, are they really implementing the necessary skills and habits to move to the next level? The only way you will know that is through tracking results of each agent when it comes to the core factors of the business. Most particularly they are:
- The type of prospecting activities undertaken on an agent by the agent basis
- The amount of prospecting undertaken each day by each agent
- The conversions of meetings with new people as a direct result of prospecting
- The leads and opportunities that evolve from client meetings and prospect meetings
- The number of listing presentations made each week
- The number of listings per agent on an open listing basis versus an exclusive listing basis
- The time on market for each exclusive listing
- The amount of commission generated per lease transaction and per sales transaction
- The number of new clients entered into the database by each agent on a weekly basis
- The accuracy of the database when it comes to client contact details and current information
- The number of clicks and hits that apply to listings placed on the Internet by each agent
- The way in which each agent will integrate social media to listing opportunities and marketing efforts
- The amount of vendor paid marketing funds converted on a weekly basis for current listings for each agent
- The listing refresh process and frequency that applies to current listings with each agent
- The feedback that each client may give when it comes to the services provided by each agent with the listing
So there are plenty of things to track here when it comes to identifying performance opportunities, as strengths, and weaknesses. The rules should apply across the brokerage and should delve into the activities of each agent. You will soon see and identify the agents that are under-performing, allowing you to take the necessary steps of adjustment in each case.
The commercial real estate industry can be highly rewarding in so many different ways when appropriate tasks and opportunities are seized in a timely way. Almost every element of success in the industry will be centered on the activities of individual agents. Encourage your people in the business team to do the right things in the right way and to make adjustments where necessary.
A successful commercial real estate agent has the ability to tap into a few perks that come with the job. That being said, the perks only apply to those good agents that are successful in their business activities. Hard work is required to break through a few ‘barriers’ of sales performance.
Any agent that doesn’t put in the required hours and the focus to their career will find the industry very unkind; the new business doesn’t just walk in the door, you have to go out and find it. The perks and the results only come to those that work to a definite plan and improve their skills as part of the process. I guess it’s the same in any sales related career; however the commissions in commercial real estate can be very large per transaction, and on that basis it can be a very rewarding career choice.
So when you focus on the right property types and sizes, the commissions per transaction are very good. Also if you focus on the high quality properties and get known as the ‘go to’ industry specialist in that property segment, then your real estate business starts to get some traction. That being said, personal improvement and skill development are really important factors in career development in commercial real estate brokerage; you will never really know too much or have all the skills you need to be a top agent. Constant improvement is required. Practice is a good business process.
So what can be the perks of the job? Try some of these for starters:
- Flexibility in working hours
- Autonomy in activities
- Good commissions or earnings
- Technology toys
- Upmarket motor vehicle
- Overseas trips or holidays
- Lifestyle and living
- Early retirement (?)
So all of this is quite attractive, correct? I go back to the point that hard work is required to get anywhere in our industry; but you would expect that wouldn’t you?
The good things in commercial real estate brokerage only come to those that really push themselves on a daily basis and improve their core skills. What are some of those core skills that help things come together? Try these:
- Communication and conversation – it is just so important to be able to talk to lots of people every day in a relevant way; that’s how you grow your market share. As part of that you should have your database of contacts, VIP clients, prospecting programs, and marketing systems all active at the same time.
- Local property knowledge – the property market is always changing, so keep up to date with property prices, rents, yields, returns, supply and demand, and redevelopment needs or property redundancy.
- Negotiation – some of the people that we get involved with in a sale or a lease will present very challenging situations of sale or lease. Good negotiation skills underpin most property deals, be they in sale or leasing. The only way you can negotiate with confidence is to understand the property market in all respects. Practice your negotiation skills regularly. Be prepared for the common problems of the industry today and how to negotiate through them.
- Marketing – the processes of promoting a property and for that matter yourself are quite special. Technology today helps us with the marketing process. Newsletters, emails, direct mail, telephone calls, social media, plus signboards, websites, print media, brochures, and blogs are all part of the marketing process. Good agents know how to use all of these tools and do so regularly to a particular system. When it comes to marketing it is really important to track the things that work and repeat the process as often as possible.
So, the message here is that the perks of a career in commercial real estate brokerage come to those that work with real focus and consistency, whilst improving their skills and market knowledge. Are you ready? They say that ‘the sky is the limit’.
One very important part of the commercial real estate process is to do everything possible to get the telephone to ring with fresh and valuable property enquiry. Quality properties create more customer enquiry, as an agent you should be focusing on identifying and creating good quality listings within your brokerage.
It is a fact that a few good listing campaigns comprehensively marketed into your local area will create many leads and opportunities into the future. That being said, it is necessary to track and measure the entire enquiry coming to you across all of the listings; you will see the strengths and weaknesses of every campaign. That is where your database will be valuable and integral to tracking the marketing processes you adopt.
When you track and measure the inbound enquiry coming to you or your office, you can understand the factors of marketing that are working in today’s property conditions. Some methods of sale and methods of lease are far more effective than others when it comes to the local area and the property type.
Here are some ideas to help you with strengthening the customer enquiry for your brokerage:
- Refresh the listing – During the average promotional campaign you will find that the levels of enquiry will improve when you refresh the listing and or adjust the price and the marketing campaign. On that basis every listing should be reviewed every 14 days for both refreshing and rewording. Condition your clients to accept price adjustments on a monthly basis.
- Attract inbound enquiry – You will see that particular methods of marketing are far more effective than others in your town or city; adopt the marketing methods that work and drop those that are low in converting enquiry.
- How did they reach you? – Find out how a person has reached you and what triggered that connection. It could be a particular listing or your market share that attracts the enquiry. Over the longer term you should see a lift in personal profile and inbound enquiry based on that.
- Use professional photographs – Every exclusive listing should be enhanced with quality photographs. There is a cost to the process and that cost should be vendor paid. You can see and reap the benefits of quality photographs in your property marketing campaigns.
- Use 3 different advertising formats – When promoting a single property, have 3 different versions of advertising that can be placed on different industry portals and brokerage websites. Different advertising copy and different layouts will be valuable in broadening the enquiries that you get from the target market.
- Use success letters – When you have listed or sold a local property, use the success letter process to spread the word to local businesses and property owners. The success letter process is most effective when you cover the properties in the immediate vicinity of the subject listing.
- Write Property Editorials – Whilst newspapers have limited promotional value today in property marketing (given the impact of the internet), the newspapers still need good quality editorial to support and drive readership. With every exclusive listing write and submit editorials to the local newspapers. Support the editorials with high quality photographs.
So there are plenty of things to do here with building customer interaction. Effort should be applied to exclusively listed properties where you can see results and enquiry growth potential.
In commercial real estate brokerage the listing presentation is likely to be the best and only opportunity you will have to impress the client with your professional real estate services. Most listing presentations today are highly competitive involving a number of agents.
Any high quality property is likely to be offered to the market only after the client has completed a series of competitive agency presentations. It directly follows that every agent or broker should be well skilled in explaining the listing strategy and marketing process that they can bring to the listing.
The marketing package presented to the client should be creative and competitive first and foremost. Whilst all of this may seem logical, many agents struggle with creativity and direct marketing; they thereby do not stand out as the ‘agent of choice’.
In a competitive listing situation the client needs to understand which agent offers the best marketing solutions, and just how they will attract the target market. How does your presentation rank in comparison to other agents?
To improve your chances as an agent in winning the listing, here are valuable some tips to help the process.
- Meet the client at the property so that you can review on site issues and identify the strengths and weaknesses of the property. The strengths can be merged into the campaign and the weaknesses can be dealt with as the case may be.
- Show the client how you will move prospective buyers or tenants through the property and explain the strategy of the process. This simple strategy shows the client that you really understand how to feature the property.
- If the property is of some quality, establish a display board within the premises where photographs and marketing material can be placed to refer to as part of the inspection process. The area in which the board is placed should be well lit and strategic for featuring the best parts of the property.
- If the property is large, arrange for a portfolio of professionally taken photographs to be used in any property discussion or on site presentation. You can also carry the photographs in your laptop or smart phone for ease of access.
- Show the client how you will use your marketing material to feature and help the inspection process. You should have some samples of brochures and flyers from other successful campaigns to explain the opportunity.
- Put together some local business information to help a prospective buyer or tenant see the benefit of locating in the area. Statistics on business growth, business types, transport and local infrastructure will be of use.
So the message here is precise. If you want to win a property listing, make sure that you are fully prepared for the presentation to be made to the client. Make your message clear and unique; stand out as the agent of choice to show how you can reach the target market of buyers or tenants. Prove that you have done so in other similar situations. Confidence and local property market information will help you do that.
In commercial real estate you need seller paid marketing funds to spread the word about the property and its upcoming sale. Without that marketing approach, it can be very hard to get the message around the industry about the pending sale and the suitability of the property to the target audience.
If the client will not contribute towards property promotion, you have to ask yourself whether the listing is worth having. Think about all those other exclusive listings that you have where the clients have already spent good money on marketing. Shouldn’t you spend more time on those listings?
Some agents will decline an exclusive listing without vendor paid funds and I tend to agree with the practice. If you have a motivated client then you have something to work with and promote. Marketing funds helps reach out to the right buyers of the listing.
Here are some principles behind the process of vendor or seller paid marketing:
- Get the advertising money upfront before you spend time and effort in the campaign. Don’t start the campaign without funds in bank. Many a client has stalled on paying marketing funds later on, especially when buyers are hard to find or if inspections are slow to create.
- When it comes to advertising on the industry portals or websites, ensure that the client is prepared to pay for premium placement or elite type listings online. Given that there are plenty of local listings on the market at any point in time, your quality property has to stand out above others.
- Your brokerage is likely to have a website for the promotion of listings in addition to the industry portals. Develop a ‘premium strategy’ for quality listings where they feature on your home page for a number of days. The client should pay for this extra service on your website.
- Every exclusive listing should be promoted in your email newsletter. Those newsletters should be going out to the market every 7 or 14 days and should be property type or zone specific. You can charge a special rate for this despatch. If you have a large database, you could charge $150 per email database send. To sell the concept to your clients show them the size of your database and its relevance to the listing. Show them the shortlist of people you have already identified as potential buyers.
- Let’s assume you have an exclusive listing; that listing should be the subject of 3 or 4 different types of advertisements all separately worded to minimise repetition. You can also use a selection of professional photographs to attract the eye of the reader.
- To help sell the concept of seller paid marketing funds, tell the client exactly how you will be personally contacting directly the property owners and the business proprietors locally. Most agents won’t leave the desk to promote a property locally. That is an amazing opportunity for those that do. Physically take your quality exclusive listing to the surrounding property owners and business leaders.
- Communicate continually. When the client has spent good money on marketing, it is up to you to tell the client every 2 or 3 days how things are going in promoting the listing. Give them plenty of feedback on website hits, email click throughs, and direct call enquiries. If you take an inspection at the property, tell the client what you found in the inspection.
You could say that this is not ‘rocket science’ and that most agents should do these things. The fact of the matter is that most agents do not market a listing specifically. Those that do however reap the benefits of better inbound enquiries and commission opportunities.
In commercial real estate there are unlimited opportunities for real estate agents to earn good income and grow market share. In saying that, the results achieved are all driven by personal effort.
There are 3 separate skill bases or services to the market and each are quite specialised. Decide what you like do and what will give you the most reward (physical and financial). There is no point in attempting to do something that you do not understand or like; that will be too personally restricting.
So the 3 skill bases are:
- Commercial and investment property sales
- Investment property leasing
- Commercial and retail property management
Some agents will choose to work on both sales and leasing. That is a good thing as the skill bases are similar and they are linked when it comes to working with clients. A leasing client today is likely to be a sale or purchase client in the future.
The skills required to be a property manager are a bit different, and the long term target when working with property management clients is that of providing professional service, and not just a single deal (as in sales and leasing). Property managers for that reason are ‘deal oriented’ but ‘service strong’. Building relationships over the long term is really what professional property management is all about.
If you have chosen commercial real estate as a career for yourself, then understand your character and its best ‘fit’ for the tasks at hand. You can work in any or all of these 3 segments or sections of the market within your agency. Choose the section of the industry that is best for your skills, knowledge and business style.
To move ahead in our industry it is best to prepare a set of goals and a small personal business plan. That strategy will help you with progress and adjustment during the year. Here are some more tips to strengthen your push and direction as a real estate agent:
- Motivation – You may have heard a lot about motivation and its requirement in any career. In our industry it is a very personal thing. Self-belief is a good thing, but action taking is far more important. Every day you will need to do specific things that can be a challenge. On that basis your levels of personal motivation must be significant; no other person can make things happen for you.
- Goals and targets – When you know the section of the market that you are working in together with your location, your goals can be set based on not just the personal performance that you are capable of, but also the ability of the market to give you opportunities. It directly follows that you will need to know your market and its growth factors and possibilities. Research is required to understand the history of local sales, leasing, and property management (depending on your skill base). Make sure that your town or city has the growth possibilities that you are looking for at a personal level. Ensure that you know how you will be tapping into those possibilities.
- Putting your plan in motion – As with any plan certain actions will be required. Every day you will be required to focus on new business, new people, and new properties. That is in addition to everything else that happens with current clients and properties. The most successful people in our industry are those that spend a good part of every day focusing on prospecting for new business. From the earliest stages of your career, set this rule in motion. Watch how results come back to you and track your results. Make adjustments in your prospecting and cold calling so you are growing your business in any property market and at any time.
These three factors are perhaps the most important to help you get traction and market share as a broker or agent. Look at what you are doing today and make adjustments where necessary. Strive to improve on a daily basis in commercial real estate agency.
Commercial real estate websites today are increasingly important as most people considering selling, buying, or renting are going online to research properties before or as part of the process. Every commercial real estate brokerage should have a high quality website for that very reason. A brokerage website once created should be optimized for your property market location, the properties that you sell or lease, and the people that can need your services.
Many brokers and agents only use the industry portals for property promotion and marketing. Not only is that choice quite expensive, it can be and is usually short sighted. Industry portals do offer some advantages in attracting enquiries; however you are limited to their usage policies and their high prices. A ‘standard’ listing package on the portals can be lost in a ‘sea of other listings’.
If you want your property to have a reasonable chance of being seen by buyers and tenants, have you ever noticed how you must list your properties in the online portals with some form of ‘priority placement’? That ‘priority’ process costs real money and is set and controlled by the portals.
In many respects you will limit your online advertising results if ‘priority portal placement’ cannot be covered in a promotional campaign. Only vendor paid marketing campaigns can absorb the high costs of a listing having a ‘portal priority placement’; if the vendor declines the cost then you will most likely have a marketing campaign achieving less inbound inquiries.
To increase your online marketing capability with property listings, you should at least have a selection if not all of the following active and operational:
- Access to industry portals (vendor paid marketing funds for priority placement). This is a cost related decision with every property campaign.
- A well designed website for your brokerage and your listings that is optimized for search engine exposure, location, and property type. If your brokerage specializes in multiple property types you may consider installing special landing pages inside your main website. Those landing pages should be optimized for the property type (that will help your search engine ‘visibility’).
- A series of blogs linking back to your website. The blogs should be property niche specific and can be run by individual agents as part of their personal marketing efforts. The blogs can be linked to and from your newsletter and also your social media platforms.
- Google analytics tracking and measuring the results and configuration of your website and blogs. Certain property types and listings will create more ‘online’ interest. Google Analytics will help you understand those things.
- A professional email newsletter that is sent to your database on a regular basis to share information about property updates and local listing activity.
- An online database and auto responder service that simplifies client contact and capture from all your blogs and websites.
From this process and these issues you can build your online profile for your brokerage and agency. In doing that, understand that the process does not stop and requires constant upgrading and a ‘refresh’ of strategies.