When you are about to meet a new client to discuss their property, prepare a list of questions beforehand to get to the facts of what the client is trying to achieve. There are five key questions here that I always start with when meeting a sales client for the first time. Preparation is the key to a productive sales marketing campaign. The questions help with that.
Of course, there are always more questions that evolve from the first five questions, so be prepared to probe the client for information, and document the answers that you get. Preparation is the key to getting to the real facts of the property and the client’s situation. Note taking is then wise to protect yourself from misleading events or later disagreements.
Why ask all these questions? Well, it is a known fact that some clients will hide or not disclose the full information about a property. They tend to think that withholding the negative information at the start of marketing will give them a higher price or perhaps better enquiry. The reality is that any hidden information will usually come out in the sale or due diligence process.
The buyers of commercial and retail real estate today are smart and informed. The earlier you can get all the facts about the property, the better it is for you and the client. Explain to the client that they must disclose all that they know.
Watch for What Is Not Said in Listing or Sales Negotiations
As another note on this here, any hidden information will usually do a few things to your transaction including:
Stop the negotiations and any progress
Threaten the legality of the transaction
Jeopardise the ability to achieve a settlement
Risk the transaction being taken to court
Allow claims to be lodged against the property owner and agent for misrepresentation
Don’t allow yourself and or your client to be involved in these difficult situations. Get to the full facts of every property transaction before you take it to the market; when in any doubt ask more questions. Through all and any property enquiries, do not speculate about any information that you may not have available.
Key Sales Questions
Here are the key questions that I believe are the starting points for getting to all the client’s property issues. These questions allow you to go further and deeper into issues identified:
When and why did they purchase the property? This question allows you to understand the original motivations of the client in the first acquisition. Perhaps they purchased the property for investment and or as a base for their business to operate. When you know why they purchased the property, you can then judge whether the asset has satisfied their needs.
What is the ownership structure of the property? Sometimes there are multiple owners and or decision makers to the sale and marketing of commercial or retail property. Understand who they are, and more importantly, that you understand their motivations and agreement to proceed.
What are the restrictions and limitations applicable to the property? Some properties will have issues of operation, compliance, legality, and function. The best way to probe these things is to use a checklist of questions that you know would apply to property types in the location.
Has the property been on the market recently? It is very possible that they have tried to sell the property recently. If that is the case you must know about that activity and the results that evolved from the promotion. Buyers locally will see the listing coming back into the market; you must have your answers ready.
Why are they selling and what is their target price today?Perhaps these are quite direct questions, but the variety of answers that you get will help you with knowing the momentum that the client may have towards any sale and marketing process.
As mentioned, these questions allow you to go deeper into the client’s situation and their property as it appears to you today. Be prepared to ask these questions and others as part of the listing meeting and before the property is released to potential buyer enquiry.
In an average working week, as a broker or an agent, you will attend plenty of meetings with clients and prospects. Your listening skills and meeting strategies will be tested; they should be refined and optimized for each situation that could evolve.
Improve your communications skills and your listening skills. Strategically connect with ever more people in your location and with your property marketing activities.
Accurately listen as part of a property discussion or negotiation. Watch what happens with all your conversations relating to commercial property, and know what is being said by the stakeholders.
Take notes to support discussions and progress; send off an email soon after a discussion to detail the current position. A full understanding will help you with your position of negotiation or the desired strategic outcome.
The Challenges of Negotiations and Clients
It is a fact that some clients will be more difficult than others when it comes to negotiation, listing, property documentation, and marketing. The same levels of difficulty apply to prospects and the third parties to any transaction.
Through all stages of the property transaction, there will be issues to discuss and opportunities to create. Improve your professional communications skills through practice and deliberation. Set your communication systems in place to help you with prospecting, listing, and presenting properties.
Here are some rules that can help you with all your listening skills, client connections, and negotiation opportunities:
Where possible, choose the place and the time to meet with other parties as part of any property negotiation or inspection. Try to keep control of the discussion or negotiation through meeting location selection and timing.
Check your property and listing information before you give it to others. Ensure that you have all the supporting documentation validated and ready to display or use in any inspection and or presentation. Expect that you will get questions on property matters, so have your supporting information ready.
Don’t just listen to the other person but watch what they say and observe how they do it as part of explaining their position or negotiating. The body language of the other party will give you some valuable indicators to work on progressing a transaction forward.
Understand all the alternatives that can apply to the negotiation. Do the people or stakeholders in the transaction need to achieve an agreement, or can they walk away from the discussion?
Take plenty of notes as part of a negotiation process and meeting or conversation. Your notes will help you in the future remember what was said and done or perhaps agreed. Sometimes disputes occur between the parties in a property transaction, and your notes will be the only way to protect your position and recollection.
Ask plenty of questions relating to a property and or client situation. When in any doubt, ask more questions. As you get the answers that you require, observe the other party in what they are saying and how they are saying it. Look for the problems of interpretation and message accuracy.
Qualify any comments and restate the position of the other party. The stakeholders to a property transaction will have a position or belief so you will need to document that fact accurately and legally for the property and the client. Don’t proceed with documentation until you know that all is correct.
Any action that is agreed between the parties will need to be taken in a timely way. Timeliness is important and can sometimes be a ‘deal breaker’. Know the legalities of the matter, and how you can document things accurately for the client’s position, their instructions, and the facts of the property.
Listen carefully and comprehensively as part of each property meeting and negotiation. Establish your rules and your systems of communication control so that every negotiation can be directed and shaped towards the outcomes that the client requires.
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.
They say that ‘curiosity killed the cat’, however that is not the case in commercial real estate brokerage. Curiosity is a good thing for any agent or broker to develop, and will encourage the right information that helps with results in prospecting and marketing efforts. Are you ready for the ‘curiosity’ challenge?
So it is a fact, being ‘curious’ should be a core skill to develop for any property agent or broker. Asking questions in a professional way will help you get to the right facts of the market, and the best people looking to do something with local property.
In a sensible and professional way, questions well-crafted will help you find listings and client opportunity. An agent or broker that cannot or does not ask lots of questions will not succeed as a top agent, and will struggle to find market share.
When you work in commercial real estate brokerage you need plenty of quality listings, and then a buyer management system to support and encourage offers and sale contracts. If you choose the right listings, enquiries should come your way; every enquiry is an opportunity for the future and that is why the process should be well managed.
As a special note here, exclusive listings help you control buyers; open listings by contrast give you little control over the property, the client, and the buyer enquiry. So your primary focus should always be to attract and convert exclusive listings that you control as an agent or broker; if the listings are of quality, then you should have a good ongoing source of enquiry. That is where your database becomes really important, but more on that later.
Here are some buyer management ideas:
Buyers are sometimes ‘liars’ (or selective information providers), and on that basis should be fully qualified before you do too much with them. Understand exactly who they are (including contact detail), what they want by way of property, how they have found you, and question deeply their ability to act on a property purchase. All of this has to happen before you do anything else. Expect the buyer to limit or manipulate the information they give you; careful questioning should solve that problem and get to the real facts.
Have they seen other property locally? If they are working with other agents and are considering other property to purchase it is best to know about it up front. That is why ‘exclusive listings’ are so important; you control the listing stock and so any inspections are yours to create and control.
What do they know about the local property market? That information is part of the qualification process. See what they know about competing properties, prices, and methods of property purchase (see what purchase method suits them the best).
Are they a ‘hot buyer’? By ‘hot buyer’ I mean someone that has the ability to act and is motivated in some way to take immediate action. Find out what time frames they have to satisfy the property need as well as the critical ‘must have’ factors in property location, improvements, and property type. If they are ready to act on a purchase then they should rise to the top of the enquiry list, and a full review of your available listings should occur.
Don’t show them too many properties at any one time; 3 or 4 are usually enough in any one property sitting. Too many properties inspected at one time will usually frustrate the buyer decision and deal momentum.
When you understand these things you can put some urgency into the property selection, inspection, and purchase process. That’s how you work with buyers of commercial property today.
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.
In commercial real estate today, agents are and should be responsible for marketing themselves. That requirement is in addition to the general brokerage marketing process. At a personal level ‘information marketing’ can be a valuable strategy for individual agents to develop and use. You can build it into your personal sales plan.
So what is ‘information marketing’? It is the provision and use of ‘quality information’ to attract prospects and people online. When correctly implemented, that ‘attraction factor’ can help real estate agents get substantially more online profile as an ‘expert’ in a property type and or location. The strategy works well in commercial real estate and will help you attract more property enquiries locally, and people to use your real estate services.
Here are some of the big issues to help you get started in ‘information marketing’ as a real estate agent or broker:
Focus your information and efforts on your local area and your property type. Everything that you do in the marketing process should be centred firmly in your market ‘niche’ and location. To achieve this, decide what area of your town or city is your ‘territory’ of focus. Within that area, what property type(s) will be your special field of endeavor? All of your local marketing efforts should be built around those answers. For example, you may focus on ‘industrial warehouse leasing’ or ‘shopping centre sales’. Choose on market segment and drill down into it. Define your market ‘niche’ and work within it as part of your marketing processes.
Start a real estate blog on one of the blogging platforms (Blogger, or WordPress) and focus your blogs on your property type and location. Everything that you post to your blog should stay within those niche factors; that will help the search engines see you as an agent and the relevance of information that you provide. Topic consistency is the key to the process.
All of your blogs should be written about the location and the property type. The blogs should be ‘informational’ and not ‘advertorial’; in other words your blogs should be helpful and useful. When you provide valuable local property market information, you start to build trust with your readers.
On your blog site, link an auto responder and database service to your blog articles so interested people can register for more information about your property type, and town or city. You can now see why fresh ‘information’ is so important to making this marketing process work. Lots of agents advertise prolifically, but not many actually help people with local property information in a convenient way such as an online blog.
Integrate your blogs and articles to your social media platforms. Whilst most social media platforms concentrate on being ‘social’, most agents only achieve and focus on that level of interaction (which can be self centered and of little interest to others). Take a step further in personal marketing by being ‘helpful’ with local property market information and articles from your blog; provide the links accordingly across all of your social media channels.
All of the above strategies are simple and yet advanced. They can be implemented to a substantial and successful level by any agent in real estate. They are very suitable for commercial real estate agents and brokers. If you are struggling with being ‘seen’ as a broker in your local town or city, now might be a good time to start the online marketing process. Use local information marketing to achieve that.
They say that a person can change a career a few times in their working life. In commercial real estate that doesn’t need to be the case. There are so many options within the industry that you can easily move around within property types and specialities; variety and opportunities are always available to those that look for them. A good career can be obtained by those that are prepared to learn and work hard.
Here are some tips and ideas to help you with your business activities and focus in the industry:
Market knowledge – You will be tested by property owners, business leaders, and others as part of prospecting and networking. Local property market knowledge will be valuable leverage in connecting with more people. Most people and the prospects that we work with don’t have the exposure to the market; they need good real estate agents to tell them what is going on in sales, leasing, and new property developments. Build your knowledge so that you can be of real value to the people you talk to.
Observe and interpret – Observe the market intelligently and completely. Look at the relationships between prices, rents, and investment. There are reasons for your clients and prospects to transact a sale or a lease. Look for those reasons. Look for distressed properties, changing of use, lease pressures, vacancy factors, and returns on investment. Those issues will all offer opportunities for new business and listing activity.
Practice – I cannot understate the importance of practice. Our industry is one of professionalism across key skills such as listing, prospecting, inspecting, negotiating, and marketing. Each of those factors requires regular practice if you want to accelerate results.
Prospecting – Connecting with new people and particularly those looking for property opportunity or change should occur every day. Most agents struggle with the disciplines to do that. For those agents that devote the time to prospecting and networking for new business, the market can be very rewarding in so many ways.
Systems – The actions that you take each day will be boosted by systems that can be monitored and improved at a personal level. Have a careful look at your systems and activities in prospecting and marketing. Both of those issues are so critical to growing market share. Your database will be part of that process of growth and change.
Client collateral – Your clients are the lifeblood of the market that you work in. Over time look to grow your client relationships and services. Improve your value by specialising in certain segments of the market.
So these 6 simple things are so vital to opportunity in commercial real estate agency. They are the foundations or ‘corner stones’ of a successful commercial real estate career. Now might be a good time to look at any weaknesses in these factors that can be improved on or modified for better personal performance.
When it comes to selling or leasing any commercial, industrial, or retail property, the more specific that you are to the location and property the easier it is to attract attention and negotiate. To do something with this you need property specific data. It is very difficult for the negotiating party to refute or dispute valid information from the local market.
So, the message here is quite clear that you will need to create and maintain relevant property information that you can use in any negotiation locally. Here are some ideas to help you with that:
Track the activity of prices within your property speciality. The prices can be related to land, improvements, and location. Take those numbers and trend them over a period of time using a simple line or bar graph. The visual approach can be very powerful when it comes to any client or prospect presentation.
When it comes to selling any property, there will be a preferable method of sale. That sale method will be based on industry results and activity, the property type, and demand. Select the best preferable method of sale when it comes to every property presentation and sales pitch. Ensure that the client clearly understands your reasons for that particular choice. Use graphs and charts to show them how one method of sale is proving to be more successful than others.
Given the previous point, you can and should track the levels of rental that apply within the property type. Rental variations can be and usually are a bit more challenging from the analysis point of view. You will need to address and assess the rental types such as gross rental, net rental, incentives, and market rentals. Understand what is leasing and for what reason. Business sentiment in the local area and your town or city will have a lot to do with leasing enquiry and lease conversions. What types of leases are being negotiated today and for what reason?
Understand the supply and demand for investment property and business premises. To track that activity you can monitor the new planning approvals being processed at your municipal council. Also look for any changes to property zoning and property use.
The supply of vacant land will have an impact on the creation of new property developments. New property developments are considered when the population and the business demographic are within a growth phase. In some towns and cities, the supply of vacant land is restricted. On that basis a change of property use and redevelopment will be more likely. Staying close contact with property developers and the business community to identify any future needs and changes within property demand.
The property promotion process is quite specific if you want to win an exclusive listing. You can show the client quite clearly how specific that is when it comes to their property challenge with any sale or leasing. Use local market information and comparable evidence through charts, graphs, and historic trends to help prove your point.
When you specialise within a property type, this information display is quite important. The specific approach to the property type in any listing presentation will help you greatly in conversions.
Personal branding in commercial real estate is quite important. At a personal level you can be a ‘cool brand’, and that by definition is someone that is good to know and an expert in their field of real estate and in the location. On that basis clients and prospects will seek you out at the ‘go to person’ for solving property problems. You could say that you then have real ‘market attraction’.
This image will help you with listings and growth of market share. Are you up to the challenge? Let’s look at this a bit more.
So how do you create this very special image as a top agent and expert in your field? Prospecting will help you a lot, but in saying that you can add some rules and processes to the prospecting process. There is no point in being ordinary in our industry as you will just fade into the already large group of other brokers and agents; every listing pitch will then be a competitive event. Consider these alternatives:
Ideas person – many properties and clients will be unique and challenging. For that reason you can be an ‘ideas’ person to help solve the complex property situation facing the client. Every exclusive listing should be handled with a high degree of creativity in marketing and promotion.
Great negotiator – some properties are challenging as to the complexity of the sales contract or property lease. Make sure you have enough knowledge to build the negotiation momentum for your client. Any hurdles to the marketing of the property should have been resolved early in the property listing process. Preparation is the key to resolving negotiation issues.
Solution provider – some of your competitors will be quite ‘generic’ when it comes to marketing a property and establishing a campaign. Your solutions must be better than all the other agents; that’s how you can convert exclusive listings much more effectively.
Stand out in a crowded market – to help you stand out in your area and sales territory get plenty of sign boards into your zone. As a priority make sure your signs are more effective in placement and detail. That will mean some vendor paid funds to take the listing to the market.
Commitment to task – many clients will talk of ‘agents that have failed them’. The fact of the matter is that the generic support for clients with their property today will be of little benefit in converting a sale or lease. If a property is special then you should provide special ideas and momentum to the promotion process. You can only do that when the client has given you an exclusive listing. Can you convert more exclusive listings? If not, why not? Set yourself a challenge to list only exclusive listings of a quality nature.
When you review these points, apply them to your own personal marketing profile. How do you match the image? Can you do better?
A commercial real estate career can (and should be) very rewarding. In saying that the ‘rewards’ only come when an agent or broker has the ‘system’ of brokerage under control and that will be a balance of things including these: Talking to new people every day Connecting with clients and prospects into the future Researching […]
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