In commercial real estate the prospects and clients that we serve are quick to judge you. They will judge you by what you do and what you say. They will also judge you on what you do not do. For this reason it pays for you to be absolutely focused on positive connection and communication with all the people in your database and your client records. Systems and relevance will help you with all your connections and leads. Here are some tips from our Newsletter.
Relationships Are the Key
The main reason we win listings is through relationships. Those relationships are with the right people locally. Commercial real estate agency is built around the trust that you establish with landlords, tenants, business leaders, and property investors.
I was recently talking with a fellow agent that was just moving from residential property into commercial property. The question he raised was ‘How do you establish your database and client base?’ The fact of the matter is that a system is required to take you forward as an agent in your local territory. Without a system of client contact your career will go up and down like a roller coaster.
Don’t make things hard on yourself with listings and commissions. You have chosen a career of massive opportunity; you just need to the required focus and momentum. Start today to deal with the contacts and database that you require. Expect that the process will take time, but the results will come.
Here are some ideas to help you deal with the leads and prospect list that you require.
- Business leaders will be a good source of business in one form or another. They may own or lease the premises that they are in; either way you can help them. Business owners and leaders are easy to find given that you can use the telephone book and door knock on a few business doors. These people are the easiest to network with and make contact. You should be talking to 20 business people per day. Ask the right questions and you will get some valuable information that you can do something with.
- Property investors will come to you from other marketing efforts, or perhaps the branding and marketing of your office or agency. Get to know these people and the type of help that they require. As a local investor they like to work with agents that really know the local area and how to tap into the deals. Even in the toughest of property markets there will always be property investors looking for good quality property or tenants.
- Property developers come and go from the market based on the supply and demand for leased space and property ownership. You can get good property business from them, however they require understanding and they should not be trusted until you have their name on a valid appointment to act. Property developers are very good at using agents without paying fees. Don’t fall into the trap of service without fees.
With these three groups of people you can develop your lead generation system and market share. Prospect into these groups every day; soon you will see your leads grow and the listing opportunity open up.
You can get more tips for commercial real estate agents in our Newsletter.
In commercial and retail property sales and leasing, regular contact with local landlords will help you with growing your market share, and improving your commissions. Landlords require expert assistance when it comes to quality investment properties. They cannot do everything themselves (although they may think that they can).
Most landlords only have a spattering of knowledge when it comes to the bigger issues and challenges of commercial property ownership and property performance. Consider some of the following that you know and that landlords do not:
- Market rentals for property type and location
- Enquiries by local tenants for new space
- Occupancy costs relating to property types
- Leasing strategies in today’s property market
- Relocation and renovation strategies
- Income improvement processes for leasing property today
- Incentive strategies to create more property enquiry
- Marketing strategies for challenging property situations
- Franchise tenant leasing and occupation
You can be an expert in all of these things. It is that expertise and knowledge that landlords require and you can market yourself around. Local property information will always be of interest to the landlord’s that you talk to.
Over time the relationship that you establish with local property landlords can be strengthened through regular contact, but also through the provision of relevant information and specialized services. Here are some strategies to help you in that process:
- Keep the landlords up to date with information about the changes to vacancy factors in the local area. Throughout the business year, vacancy factors will change relative to the property type and the supply and demand of new space locally. Track these numbers and make them available to your good clients or prospects.
- Given that the property market will change throughout the year, you can provide market updates relating to investment property, market rentals, lease strategies, vacancy rates, time on market, and local business sentiment and activity. All of that information should be at your fingertips as the local commercial real estate specialist. You can produce a research paper on those facts; that paper can be directly distributed and be made available from your website as an enticement to join up to your newsletter or mailing list.
- Any new property developments approved through the local planning office can challenge the owners of existing properties in the same general location. You can keep those landlords up to date with information regards other new property developments and the progress of the development. It is a prime opportunity to help them minimise their vacancy factor as the threat of the new property grows through its construction and project leasing phase.
- You can provide a tenant retention strategy for the landlords that you serve. A good tenant retention plan will incorporate lease strategies, tenancy mix solutions, relocation and refurbishment plans, and vacancy management. Charge a fee for the process.
- Any of the properties that you market locally for sale or for lease can be communicated to the other landlords that you know, in case they have an interest in monitoring or participating in the local marketing campaign. They may even have an interest in property acquisition and portfolio growth.
- When any property is listed in the local area, personally connect with all of the local business proprietors to tell them of the upcoming listing. The same process should apply with all local property owners. This thorough networking approach will show your professionalism in the industry and position you as the local top agent specialising in the property type.
Keeping in contact with landlords will always produce good opportunity over time. Establish your system of contact and keep it moving ahead. Make sure that all the local landlords know you as the expert that you should be.
When it comes to your career in commercial real estate, nothing will fast track your results faster than a good prospecting model. This then says that a prospecting model should be established into your daily business activities.
Prospecting for new business is quite a specific task and very specialized. It should be regarded as something that requires practice and directed effort. It takes about 2 or 3 hours each and every day to develop a good solid prospecting model.
This should also say that prospecting should be undertaken before anything else is done within the commercial real estate office. If all salespeople within a commercial real estate agency did this, the volume of listings and the quality of enquiry would be far higher in just about all cases. That will make the market share for the office more significant.
Quality listings and quality properties produce good enquiry. It’s in tougher markets like this that we have today that we need a solid enquiry base coming from qualified prospects. This is where your database will become highly important as part of your business activities.
Here are some ideas to help you with your prospecting activities and system.
- Determine a specific territory of prospecting. That will contain the necessary numbers of properties and businesses that will produce the required commission that you want. Make sure that the historic activity in the area has been significant and will remain so into the known future.
- Get to know all the local property owners of significant and important properties in your territory. It does take time to identify property ownership structures and particular property owners; that being said, it still needs to be done and should be merged into your prospecting model. Tackling property owner at a time is a good strategy to adopt in growing this market share as part of your prospecting system.
- The local businesses and business community will provide a significant volume of enquiry for you. They will tell you so much about the local area and also of their property requirements. In many cases they may own the property in which they are located. They could also be tenants and on that basis they will require further leasing assistance at a later time. Currently they may provide you with details of the landlord for any direct enquiry and networking.
- Go through the old sales records in your local region. On average, most commercial and retail property will change hands in every 5 to 7 years. That being said, the cycle can be a good source of future listing opportunity. You simply need to identify the right people who have purchased or sold commercial real estate about four or five years ago. They will again be entering the property industry in some way or form quite soon.
- Older lease transactions may still be current with business tenants. They will however soon be reaching the end of the lease and require assistance in locating another property. Every business in your local area should be entered into your database for the opportunity that it provides. That being said, the tenants of today are also requiring local property market information. You can be the expert to provide that.
To make your prospecting model work, a process of constant contact should occur. The commercial real estate industry is built around trust and personal connection.
The first approach to a prospect, property investor, or business proprietor should be the simple beginning of a long-term relationship. Over time you should be establishing meetings with those people and opening the door with property assistance at the right time. Those being said do not forget about property referrals and referral relationships that exist with people that you already know. Top agents do this all the time.
In today’s commercial property market, the tenants in your local area will tell you a lot if you ask the right questions. For that very reason you should merge local tenants and businesses into your prospecting activities.
Any local building with multiple tenants should be merged into your call canvassing program. Providing the owner of the building is not a client of your agency through some other business relationship, there is great advantage to be had by calling down all the tenants on a regular basis.
You can ask the business owners and managers questions such as:
- Do they own the property? Property ownership may be an opportunity for a sale and lease back at some stage in the future.
- Do they lease the property? If that is the case they will have lease change over issues and lease expiry dates coming up. Most tenants have no idea about the availability of leased premises in the local area or the current market rentals.
- When will their lease expire? If you know this date you can provide market information to them in the year leading up to the lease expiry. They may be prime tenants for relocating.
- Do they have local storage needs? Existing businesses can sometimes be under some pressure to expand storage or relocate staff into nearby local properties. Ask the questions to see what pressures of occupancy may exist.
- What type of business are they? This will have bearing on the type of property and the improvements required in leased occupation.
- Some businesses have a significant lead time to relocate given the way in which they operate and the plant and equipment that they may use in that business process.
- What labour force requirements do they have? The location of the business should be convenient for labour sourcing and access.
- Some businesses need to be near public transport or have a significant onsite car park for staff and customers as part of business operations. Find out what the business requires in case a special property in the local area could come onto the market one day.
- Ask the business owner about the landlord of the property (if they are a tenant). If you can identify the landlord, you can approach them at a later time regards leasing and property requirements.
In addition to all of the above, the tenants know a lot more about the local area than you do, and the right questions about other businesses in the street may very well turn up a property opportunity.
The best way to gather this information is to call by local businesses on a daily basis. It takes time, but if you do between 5 and 10 a day, you will get valuable leads to work on.