Commercial Real Estate Brokerage – A Custom Designed Strategy to Work with Commercial Property Investors

Every commercial property is unique and on that basis every property investor will have special challenges to work with their asset.  In every property location there will be special factors to consider and challenges to resolve.  You can be the specialist for the location to help investors through the challenges that they experience.  The value that you can offer through a set of comprehensive property services needs to be carefully considered and promoted.

Know the facts locally

To successfully work with commercial property investors, it is simply a matter of understanding what they are experiencing in the local property market and how you can be the solution that they need.  With particular clients you can drill down into the unique challenges of a single property, its ownership, and its location.

So how can you do this?  You can do an analysis of property performance and property opportunity.  You can provide a real property performance plan based on solid recommendations supported by strategy and opportunity.

What can you do?

As the local property specialist, you can add considerable value to the services that you provide your investor clients.  Specialise completely and thoroughly within your location and within a small number of property types.  That specialisation will be of great value to the clients that you serve.

Here are some of the most common challenges that you will strike with property investors today.  These particular issues all require solutions:

  • Timing – Many property decisions will be based around factors of timing. Time will impact property cash flow, rental, tenancy mix, and occupancy.  Ultimately over time there will be property based issues that will flow through to changes in capital value.  Understand the timing factors for your location when it comes to selling, leasing, and property upgrade.  When it comes to selling or leasing a property, you can show your clients the best strategies of timing matched to the challenges within the asset.
  • Financing – Some investors will need to change financing strategies and structures during the ownership cycle for a property. There will also be the need for property valuations to support mortgage funds.  Understand the duration of financing applies to the clients that you serve.  You will need to strengthen the tenancy mix and the rental income to improve and enhance the financing position.  The loan value ratio between advanced funds and property value is a ratio to watch.
  • Cash flow – The leases within the tenancy mix will support the rental cash flow. Can add cash flow be improved?  How does the rental cash flow matched to the prevailing market rentals?  You can do a rental assessment and compare the results of the assessment to other properties in the location.
  • Portfolio performance – When you delve into the factors of property performance for your client, you can cover off on matters of income enhancement, maintenance management, expenditure controls, tenancy changes, and lease changes. All of these things each year will flow to the end result of property performance.
  • Vacancy factors – How can you improve the occupancy rates within the property? How can you find the best tenants to strengthen the tenancy profiles and lease covenants?  A good property will be strengthened by the tenants in the mix.  Look at how you can encourage and shape the tenant occupancy over time.
  • Property maintenance – You cannot own an investment property without spending money. You can however develop a strategy of timing that takes into account known expenditure and the performance of the asset.  You can set a budget in place incorporating rates and taxes, repairs and maintenance, capital expenditure, and property renovations.  Understand the future of the asset and the maintenance that will be required to improve it over time.

There are some good things here that can be tracked and managed for your investment clients.  You can provide some stability and controls to enhance property performance over time.

Understand the asset for what it is, and look at how you can bring change and opportunity to the tenancy mix, rental strategy, lease documentation, and property value.  Your clients will appreciate the real strategies that you bring to the process of property ownership and investment.

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You can get more commercial real estate brokerage ideas in our Snapshot eCourse right here.

Finding New Clients in Commercial Real Estate Brokerage Today

In commercial real estate brokerage, you will hopefully have many prospects and a number of good clients.  Over time those numbers do need to grow and compound opportunities in referrals, leads, and listings.  All of these things will occur when you know your clients very well and similarly so their property needs and or situation.

Here are some tips for turning a prospect contact into a future client for your commercial real estate brokerage:

  1. In many respects you do need to know the client better than they know themselves.  Whilst they may have a particular property challenge or need, they probably do not know enough about the local market opportunities to identify exactly what they require to allow them to improve their property performance or outcome.  Look for opportunities within prices, rentals, refurbishments, relocations, marketing systems, and income and property expenditure.  You can also work within tenancy mix changes and tenant retention plans to improve the tenant profile of the building.
  2. Understand the factors of compatibility between yourself, the client, and your brokerage.  Are you providing the specialized services that match the future needs of your clients and prospects?  There is no point specializing in something that is under supported or under resourced within your brokerage.  As a case in point, retail shopping center sales and leasing require specialist retail knowledge and unique skills.  In that case the brokerage would need to have or acquire the right people and resources to do the job well.
  3. Establish a regular dialogue with your clients where you can provide up to date specialized market information for their property type.  That can be through a newsletter, industry briefing, and local area updates relating to sales and leasing activity, new development updates, and changes within property zonings or building codes.
  4. Many clients will take time to open up with complete and full information relating to their property portfolio and asset performance.  Trust and loyalty established over time will encourage them to share that information.
  5. Give more to the market than you get back.  It is a simple statement that suggests that you should give freely of your knowledge and resources to help the client relationship grow.  Establish a group of VIP clients within your database where this can be done.  Most top agents will have a database of between three hundred and six hundred well qualified prospects.  Within that group, your VIP prospects should number between 50 and 100.  They will be the people that can offer higher value and repeat business over time.  Connect with that group in a different way and in a deeper level.

Client relationships are at the center of everything when it comes to commercial real estate brokerage and agency.  You may choose to be a specialist in sales, leasing, and or property management.  Without the client connection and marketing process, you will struggle with market share.  Use some of these points mentioned to build solid foundations of client loyalty and trust.

Choosing the Best Clients in Commercial Real Estate Brokerage Today

In commercial real estate brokerage there are plenty of clients to choose from when it comes to sales, leasing, and property management activity.  In saying that, it is important to understand the ideal client profile for your brokerage business.  Some clients are better than others.  Understanding the differences will help you focus your prospecting efforts in the correct way.

The suggestion here is that you should be selective when it comes to working with some clients.  Understand the ideal client profile that will help you grow your listings and commission opportunities.

Here are some ideas to adopt in this process.  You can add to the list based on your property location and your property speciality:

  1. Review your area and your sales territory so you understand exactly how many properties exist within your target market.  There will be differences in numbers between office property, industrial property, and retail property.  Some of your target properties will be widely spread and will therefore require complete understanding when it comes to prices and rental variations.
  2. Look at the history of the area to see what has been selling and leasing over the last two or three years.  You can add to that assessment the factors of supply and demand as they relate to your area and your city.  Is your market segment growing or contracting?  How can you adjust to these fluctuations?  What levels of commission are available for future sales and leasing activity?  Focus your prospecting on quality clients and quality properties.
  3. The best customers to work for are those that can bring you repeat business over time.  That business can be in sales, leasing, and property management activity.  Some of the best clients to work for include established property investors, larger companies and corporations, and franchise groups.  Get to know the right people within each targeted segment.  Understand who the decision makers are when it comes to each investor, company, and location.
  4. The suggestion here is that you treat your customers and prospects differently.  Those high value customers that you have identified for future business should be entered into a special segment of your database.  They should receive special treatment when it comes to contact and service.  You will also be approaching them more frequently with relevant market updates and changes within the industry.
  5. Some clients will require particular property types and improvements.  Special understanding is needed when it comes to identifying the right properties for them to purchase or lease.  The same can be said when it comes to the timing of an acquisition or relocation.

So there are plenty of things to do here when it comes to for client connection and prospecting.  The choices that you make of it comes to each client in your segment of the market will help you greatly with future leasing and sales opportunity.

Get to know exactly what the client requires and tap into that opportunity over time.  When you do this correctly, many of the transactions you create will occur off market and away from the pressures of agency competition.

Robotic Listing and Selling in Commercial Real Estate Brokerage

In commercial real estate brokerage the listing and selling process can almost be ‘robotic’ if you follow the rules and use a plan to move people through your ‘pipeline’.  I am not inferring that the ‘robotic’ approach is negative; it is actually a great way to help your contact pipeline feed the listings to you and over time that means more market share.  Here are some notes from our Newsletter this week.

Listing and selling commercial real estate today is really just simple communication.  It is a matter of how ‘good’ you are at the stages and levels of interaction.

Let’s simplify the ‘pipeline’ for you.  It works this way:

  1. Property and prospect research – this is in knowing how to find the right properties and people to work with.  Research the market every night so you can get traction in better clients and listings.
  2. Prospecting activity – this is a regular daily requirement.  There is no other faster way to build your market share.  Put your prospecting time in your diary and implement the process each morning.
  3. Qualifying clients and prospects – some people that you talk to will be open and honest when it comes to their property requirements. Others may be less so open.  Ask the right questions to get to the real facts of every property need or transaction.
  4. Meetings and presentations – they should occur every day as a direct result or prospecting new people.  Target 2 new meetings per day.
  5. Listings – converting listings can be a special process. You must stand out from the competitors in your market.
  6. Marketing – this should be focused on the target market for the property and the region.
  7. Handling objections and negotiating – every property is different so be prepared for every negotiation.
  8. Documentation – accuracy is critical to help a deal move ahead
  9. Follow through on closed deals – don’t let a deal slow or get diverted due to inattention.
  10. Long term relationships – they will bring you the leads over time.

They are the simple things in commercial real estate that are all as important as each other.  One stage leads to the next stage.  It directly follows that you should be very good at all of the stages if you want to generate some quality listings and the better deals that go with that.  If you are not doing so currently, then practice and personal improvement is required.

So the ‘robotic’ approach starts to appear when you have all of the stages working well and integrated into the other stages.  When you look at the commercial property industry overall and in most locations, you can improve so many listings and commission opportunities when the separate parts of the process are ‘optimised’.

You can get more tips like this in our Newsletter right here.