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 commercial real estate today the clients that we work with want one thing and that is in one word ‘results’. It is the common thread that runs through everything in commercial real estate sales and leasing.
Every client will have different criteria when it comes to ‘results’, however the fact of the matter remains that ‘results’ are the lever to client satisfaction and referrals. Top Agents focus on what I call the ‘results factor’. They aim for the results that will bring the best opportunity for the client and close the deal at the best possible outcome. When the client is happy, ongoing business will come towards you over time. Top Agents grow their business on the successes that they create for their clients.
It is no secret that the commercial and retail property industry is a bit of a challenge at the moment; that being said, results are still very possible and the agent can set up the circumstances for the client to find them.
When you list a property, get to the bottom of what the client sees as the ‘result’ that they require. A degree of honesty will be required on their part to share what they ultimately require. That honesty will only exist in an ‘exclusive listing’, but is unlikely to achieve when it comes to an ‘open listing’. In an ‘open listing’ clients tend to hold back from the full and honest facts of the sale or lease. From the very start of the listing the agent has to ‘read between the lines’ with a client that is less than open and free with all the property information. Perhaps I generalise, but it is a common problem that impacts the marketing effort for many commercial real estate agents.
To help you get to the bottom of what the client sees as the best ‘result’, here are some thoughts to take you forward and create successful listings:
What is the best timing of the sale or lease?
What factors exist in the property that could slow down a transaction?
What is the price or rent that the client sees as the lowest they can afford?
When can the client commit to the marketing program?
Will the client provide vendor paid marketing funds?
What can the client commit to when it comes to preparing the property for sale or lease?
What will be the best method of sale that can help the client get the best levels of enquiry today?
What will be the best rental and incentive to attract tenants to the property and inspect the premises?
Get to the real facts of the property and the clients situation. When you do this you can be a commercial real estate agent that brings in the ‘results’. Top Agents do that all the time.
In commercial real estate, the listings of other agencies will always be an opportunity for you for future business. Whilst it is always nice to create fresh new listing business yourself as part of your prospecting model, the other agents listings should be watched for the opportunity that they create.
Those other listings will give you not only local knowledge relating to market conditions, but also real opportunity to convert other listings around them.
Where are you today?
Before discussing this matter further, it should be said that your market share today should be identified and quantified. This will mean a regular ongoing tally of listings on an agency and salesperson basis through the local area both in property sales, and property leasing.
The best way to achieve these numbers will be through monitoring signboard counts, Internet listings, and newspaper advertisements. It is fundamentally important to understand where you are today before you can determine how to improve your market share. Is also important to understand who those competing agents are that may dominate the market today and why they do so.
The other listings
The other agents listings locally will offer some leverage and opportunity to you as part of market churn, and new business. Here are some ideas to help with that:
Expired property listings that have been neglected by other agencies over the marketing time, will be listing opportunities for you today. In many cases, the property owners of expired property listings will be frustrated and therefore highly motivated to choose another agency and fresh marketing strategy. That being said, any new listing achieved with these property owners should be taken on a basis of modified price, modified rental, or changed marketing. There is no point in repeating any marketing errors that were unsuccessful with the earlier appointed agent.
Every existing a property listing with another agency is an excuse for you to talk to the surrounding property owners near the particular listed property. A property that is available for sale or for lease is usually a catalyst for change in any other properties nearby. If any local business owners or property investors are thinking of selling or leasing, the best time to do so would be coinciding with nearby properties marketed with other agencies. The process of competition will help you convince those business owners or property investors to list and market their property today.
Time on market will be a factor that relates to both sales and leasing. Some properties will take longer to shift than others. There will be reasons behind the delay in achieving a successful transaction with any property. In some cases, the reasons may be regional, or maybe even attributable to the particular listing agent. Interpretation and observation is really important to help you get on top of the market trends. You can talk about time on market and levels of enquiry locally to help convert more listings your way.
Methods of marketing will vary from property to property and location to location. Importantly, the best method of marketing should be chosen for the particular property type and the prevailing market conditions. When you observe the other agents listings, you can see what works and what doesn’t when it comes to marketing. This information can be leverage for you when it comes to your sales presentations and pitching for further listings.
There is a distinct cycle of property change that relates to commercial property sales and leasing. Whilst this may vary on a location basis, you can usually pick the cycle averages from previous sales and previous leasing regionally. For this reason, you should go back in history looking at all the property sales and property leasing activity with all the other agencies. Commercial and retail property sales usually happen about every 5 to 7 years. At around about that time the property owner is either looking for property change or expansion of their property portfolio. Over that period of 5 to 7 years, there will usually be sufficient capital gain for a successful property change or property acquisition. The same timing factor can be said regards leasing activity although for different reasons. Many commercial and retail leases are timed to initial terms of 3 to 7 years. The tenant and or the landlord in any lease are likely to be looking for property assistance as part of that lease cycle timing.
There is no doubt that significant opportunity exists for you today in monitoring the activities and listings of your competing agents. That being said, it is not the only thing that you should do as part of your prospecting model, although it will help you significantly if approached in the correct way.