The commercial property market is a challenge at the best of times. There are plenty of things to do when it comes to commercial brokerage and agency. Each and every day a certain number of hours should be devoted to the prospecting process. That activity will be at a personal level for any agent or broker.
It stands to reason that a good broker will have a successful prospecting model to encourage new clients and listings in a regular way. The earlier that agents and brokers move towards this planning process and its implementation, the faster they move up the ranks of the market with listings and commissions.
Here are some tips to help you with the prospecting process that should be applied to office, industrial, or retail property. Given your local market conditions, you can add to the list as appropriate:
- Understand the activities of the market over the last two or three years. As the market been attracting activity or has it been contracting? It is best to work within a market that has growth and opportunity. It is best to work with property types that have a future.
- Many brokerages employ agents on the assumption that the agents will bring in the required new sales and leasing business. Certainly that is the case to a degree; it should however be observed that a good real estate brokerage will have generic marketing strategies and material to help the agents with their daily prospecting activities. An agent or a broker with little or no support from their principal will struggle.
- It is critical that a broker or an agent get signboards into their territory as soon as possible. Those signboards should be on exclusive listings. Signboard presence will always help local market profile and encourage inbound telephone calls. On that basis you can build your database.
- The Internet today offers significant opportunity when it comes to business profile and property marketing. Every brokerage or agency should have a substantial business website to promote sales and leasing listings. The brokerage should always be updating the website with the latest technology tools to capture inbound enquiries. A database portal is part of that process.
- Set aside 2 hours per day to contact new people through the local area. The easiest way to do that is through a consistent and professional cold calling process. When you have connected with a number of people across the telephone, you can move out into the marketplace and door knock a number of businesses and property owners. Personal contact in our market today is really important.
- Every new property listing will give you an opportunity to talk to many other property owners and businesses in the same location. Every successful transaction will give you further reasons to connect with the market place. Use your existing listings and exclusive listings to connect with the property market.
In looking at these activities, it is easy to see that the involvement of the agent or broker at a personal level is critical. Momentum is required every day to establish a good prospecting model to convert more listings and commissions.
In commercial and retail property management, you should have a process and a system to help you attract new property management clients. Over time the income from the management portfolio will support the agency and provide stability when sales and leasing activity is low. Here are some tips from our Newsletter.
There are a number of different ways to attract these clients to your business, with some processes being more successful than others. Here are some ideas to help:
- The best way to attract new business of this nature will be through and at the time of the completion of a successful sale or lease transaction. The property owners are primed for the discussion. It will be a matter of showing them why a professional management service will be of value to them. Perhaps you could save them time, money, or remove the frustration from the tasks involved.
- Some clients manage their own properties, and on that basis they will be targets for new business. That being said, they will typically not have the necessary systems to do the job properly. The larger the property, the more difficult it will be when it comes to tracking income, managing expenditure, and invoicing tenants. You can add to those requirements the other issues of lease management, risk controls, and tenant mix optimisation. All of these things require skill and knowledge. You can market your brokerage around the specialized services in each case.
- Review the properties currently being managed by your competitors. It should be fairly easy to understand and identify those properties that are being poorly managed. In most cases you will see evidence of that underperformance when you inspect the property and talk to the tenants. The skills of the manager will reflect in the quality of the management. Get in contact with the owners of those distressed or difficult properties, and offer a no obligation proposal to take over the property.
- Understand the leases that apply to the tenants within a property. You may find that the management fees are a recoverable item within the outgoings categories of the leases. This then says that the fees that you charge to manage will not be a financial burden to the property owner. They will simply be a recoverable item in the outgoing structure and invoicing process. Providing the property has a suitable level of outgoings when compared to other local properties, your fee recovery should be quite simple and achievable.
- The larger the property, the more complex the management process. That being said, you can provide specialised services when it comes to the tenancy mix, vacancy management, and outgoings control. All of these factors will give you leverage when it comes to winning the property management appointment.
So the message is quite clear. There will be some new business to win when it comes to managing quality properties and quality clients. The best strategy to achieve that is to identify the right time in the property cycle, and the right services to offer your clients.
Get more tips like this in our Newsletter.
In commercial real estate brokerage you need a good database. When I say ‘good’ I am not referring to the complexity or brand of database. What I am referring to is that of the accuracy and volume of data that you have collected.
There is no point running a database unless you keep the information up to date and accurate. So many brokers struggle with that requirement. You may have heard the saying, ‘rubbish in and rubbish out’? That rule certainly applies in this case. Keep your contact information up to date and accurate.
If you want to dominate your market, then you will need to contact plenty of new people each day. If you prospect for 3 hours per working day (the recommended average), then half of that time should be devoted to new contacts, and the other half of the time should be devoted to current contacts. Over time the pipeline of contact that you establish will help you with sales and leasing opportunities.
Over time your prospects and clients will be contacted many times; that is how you build market share and opportunities. On that basis your customer contact system has to be flexible and accurate. It also requires the personal involvement and accuracy of the agent or broker.
Here are some rules to help you with your prospecting and client contact systems:
- Split your prospecting time 50/50 between current contacts and new people. That is how you will build new business.
- Focus on the process of ongoing contact. That will mean telephone calls and emails to the people that you know in an ongoing way. Record the results of your last points of contact so you can refer to earlier client situations and discussions.
- Get email addresses and the consent of the people that you are talking to about ongoing contact through email. You can then set up an ‘auto responder’ for that process. Not only is it economical, but also very convenient. It will save you a lot of time.
- Build ‘trust’ over time with your clients and prospects by providing valuable local market information. You can do that with listing sheets and sale or leasing updates.
- The ideal contact frequency to use with all of your clients and prospects will be your choice, however it has been proven that you will need to make valuable personal contact (telephone or meeting) at least once every 90 days.
So there are some key things to do here. Establish your prospecting system efficiently so you can get results in your market and with the property owners or business proprietors that really do need your service.
In commercial real estate agency and brokerage, cold calling is an essential part of the business building process. Every agent and every broker should undertake a number of cold calls every day to build their market share with new people and new prospects.
In any property market and at any time, there will be new people to approach regards the professional services that you can provide in sales, leasing, or property management. At least 25 new calls should be made every day to new people that you have not spoken to before. It will take you 2 hours to make those calls. From doing that, you will nearly always reach approximately 10 or 12 people in one sitting and from that you can get one or two new meetings. That is how you get the new relationships started.
So you need to establish your cold calling process to take your business forward as an agent or broker. You should also practice your dialogue. Here are some ideas to help you with that:
- It is hard to get traction in the cold calling process without practice. This means that you will need to refine your dialogue and improve it over time. This can be done each morning as part of your preparation for the working day. You can practice call conversations as you drive to work. Without any other person in the motor vehicle, you have the opportunity to refine your scripts and your conversational ability for the cold calls that need to be done.
- Each evening you can prepare a list of 25 people to call and approach the next day. Given that we work with mainly property investors and business owners, it is really quite easy to establish a list of contacts to call. The business telephone book will give you plenty of telephone numbers. In addition to that, you can research one or two property owners each day to add to the list.
- Split your prospecting territory up into zones. That will allow you to focus your call processes to particular streets and business types. As a general rule, you should be travelling through the streets of your territory each day to identify any opportunities that you can see.
- It is best to get the calls done first thing at the start of the day. In that way nothing can interfere with your progress and prospecting system. Avoid making or attending meetings at the start of the day so that you can get your prospecting done efficiently and effectively.
- Track your call progress in a database that you personally maintain. Where possible, use a computer for this process, and have a telephone and the computer in front of you as part of making the cold calls. You can then enter the results of calls into the database immediately.
- Purchase a headset to use as part of the call prospecting system. The immediate advantage here is that you will have your hands free to record the results of the conversation. One other clear advantage is that you can stand up as part of the calling process. It is well known that call conversations made from a standing position are far more effective and connecting than those from a sitting position at a desk.
- Understand the rules that apply to the do not call register in your area. Ensure that you are adhering to those rules in making the calls.
- Track and measure your call activity and meeting conversions. The primary object of making a call should be to create a meeting with people that have a future or current need in commercial property.
- Collect e-mail addresses and mobile telephone numbers as part of the prospecting activity. Get the permission of the person that you are speaking to for ongoing contact so you can send relevant property information and advise them of market activity.
The prospecting process does not need to be hard. The telephone can be a distinct advantage when it comes to building better market share and growing your database. That being said, it does require a diligent focus and ongoing activity. That is a personal skill and a personal process.
In commercial real estate agency, the property investors that you know well and connect with regularly will provide you with lots of opportunists in sales and leasing activity. That being said you really do need to know their focus and priorities when it comes to property ownership and overall performance.
The property market changes frequently and so will the plans of the people and clients that you serve. A lease transaction today can be a sales transaction tomorrow. The same extended business opportunity can occur from a lease deal to a property management appointment. Understanding the client will help you find the right opportunities and leads.
Here are some questions to ask your clients and prospects. Adjust the questions and concepts to suit the property type and local market that you control.
- What type of property do they prefer to own and in what location? They may relate more to industrial, office or retail property. Their preference will have an impact on your prospecting activity.
- What do they own now and how long do they intend to hold that investment property? There are strategic differences between holding a property for the short term (5 years) versus longer. Any leases that are negotiated in a property will be established with due regard for the investment holding period, the cash flow required from the investment, and any renovation or relocation needs.
- The income that you set for a property will be relative to the market rental in the property type. What do they know about gross and net rent today? What impact will incentives and vacancy factors have in the leasing process and returns over coming months and years?
- Will the property need renovation soon? Some older properties will reach the end of their useful life as tenants look for better property improvements and locations. A repositioning or renovation process will need to occur with older properties. Many property investors do not know how to position current lease negotiations for that. Renovation and relocation clauses can be inserted into current lease negotiations with due regard for the upcoming property changes. In such cases, the strategy of leasing really becomes very important.
- How are outgoings and expenses running for the property? Are they comparable to the other properties locally of similar type? Keep your clients property suitably positioned in a competitive way so that any lease can be attractive and viable for new tenants considering occupation.
Simple concepts like these will help you serve your clients professionally when it comes to tenant mix and leasing. When you get the balance right, the income for the property can grow and the vacancy rates can fall.