In commercial real estate, market leadership is a very important issue, and particularly so if you specialise in a property type within a location. If you are like most agents you will have plenty of other competitive agents to work around and market against. Through all of that ‘competitive noise’ your services must stand out as real and relevant to the market place. That’s what the top agents of the market do.
When it comes to pitching and winning a listing, most of the clients that we serve want the best agent for the job; the marketing of any listing for sale or lease is not an experiment and the clients know that. It is at that point where the ‘leadership equation’ becomes important. Having spent many years in the property industry, I have seen and got to know many more agents than most people. It is a fact that the truly great agents are few in number, whilst most other agents ‘ride the rollercoaster’ of the property market through many ups and downs. Resilience is a good skill for an agent to have, but systemised action is far more important.
To develop true ‘market leadership’ an agent needs a ‘formula’ to work to that allows for factors of the market place, the property type, the location, and the current levels of enquiry.
Here are some facts and strategies that can help you reach your targets in the local area when it comes to listings and clients:
- Time – Be very conscious of your time and who you let take a ‘slice of it’ each day. You cannot invent time so you must manage your own business day to get the best results from it; all your appointments, prospecting, marketing, client contact, negotiating and paperwork must fit into the working day. Some things will be more important than others, and there will be plenty of daily pressures that can potentially shift your focus; be prepared for some real discipline in diary control and day management.
- Professional Services and Practice – If you want to be the best agent locally for the property type, then your marketing, property knowledge, and negotiation skills should be of the highest standards. A top quality agent with a dominant market share stands out ‘head and shoulders’ above others due to a recognisable difference in listing quality and listing success rate. To achieve that status, your can practice and refine your skills, improve your weaknesses and build on your strengths. Practice is something that most agents forget about as soon as the market or the listings get a bit busy. The opportunity is wide open for those agents that keep on practicing and improving their skills.
- Database – Your real estate database is the basis of creating personal new business and helping with commission growth. It takes time to grow a good database and the daily updates are ongoing. If you are struggling with new business now, it is time to look at your systems; the database should be at the centre of all of them. Integrate and lift your prospecting efforts into your database. Set the standards of daily prospecting that you should work to and start taking action.
- Marketing – Many agents would use only the most basic of marketing skills when it comes to property listings, and they do little beyond that when it comes to spreading the word about a new listing. Today we have some very advanced marketing tools and systems at our disposal. Every quality property and exclusive listing should be comprehensively marketed to produce the best outcome for the client and for the brokerage. Pitch and sell your commercial real estate services on the basis of exclusive listings supported by a comprehensive marketing tools and systems. In that way you will consistently create better results in sales and leasing activity, together with a shorter time on market.
Leadership in the commercial real estate market place is a strategic choice for top agents and top brokers. You can build your systems using some of the skills above and others to take charge of the marketplace and become a real leader when it comes to property sales, leasing, and development. Success comes to those who work hard to a plan and a process.
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.
Are there dangerous clients in commercial real estate? Absolutely; yes is the answer. You will come across them all the time. You must protect yourself from these clients that are out to manipulate the deal for themselves without true transparency.
Ethics in our industry is really important. Poor quality clients can derail your listing integrity and commissions. So the message is that you should keep to the rules in the industry that protect your actions and listing activities. Clients that are less than honest can destroy your business in many different ways.
So here are some signs to look for when it comes to client selection and communication:
- Watch out for the clients that will not sign an agency appointment ‘until you find a buyer or tenant’. The request happens all the time in our industry but you cannot and should not act outside of the laws of commercial real estate agency in your location. You are bound to act legally and with integrity; if the client wants you to ‘bend the rules’, they are not a client to have and you simply cannot trust them. In those circumstances walk away from the deal or the listing. Let some other agent waste their own time and risk legal action. It is not fun when legal claims are made against you.
- Some clients work with many agents. Now this is just fine if all relationships are ethical and legal, but your listing and negotiation information should be protected by a valid appointment to act and an established client and agent relationship. If you suspect that the client is sharing your ‘market intelligence’ with other agents, you could have a problem.
- If your client avoids giving you an exclusive listing, it can be a sign that you really do not have their commitment and trust. They could also be working with many other agents at this very moment in trying to sell or lease the property. Ask the questions and get to the real facts of the matter.
- A reluctance to give you full access to the property or comprehensive property detail is a sign that something is going on. A similar problem is evident with the client not disclosing tenant and income detail for the property. If the client is not being open and honest, step back from the deal until you know all the facts. Get copy of all current property related documentation before you go to the market, negotiate, or talk to other people. Understand the facts that are before you.
- Failing to put things in writing can be a big problem in our industry. Many conversations across the telephone happen every day. Always keep your notes of client and customer conversations and instructions. Evidence the matter back to the other party in an email or similar written or electronic form.
Lastly something should be said regards confidentiality. Know who your client is and what their instructions are. Keep client agent discussions and instructions confidential. Disclosure of privileged information can get you into a lot of trouble.
The retail shop leasing process is quite specific and special. It requires property agents that are very familiar with the retail industry and shopping center dynamics.
It is no secret that the retail shop industry is changing due to the impact of the Internet and the current economic circumstances globally. That being said, the retail shop industry doesn’t disappear it just changes. We are best placed has specialized leasing agents to help tenants and landlords move through the process of change when it comes to shopping centers and specialist retail properties.
Here are some tips to help you with creating your retail tenant mix and plans for shopping center leasing optimization:
- Check out all of the other competing properties in the local area. They will have factors associated with vacancy, tenant movement, and tenant success. Make a list of their tenants for direct contact and cold calling. Some of those tenants will be more successful than others. It is those tenants that you should encourage to move to your property.
- Look at the other competing properties with regards to property improvements, customer access, and customer profile. Also look at the factors of car parking, public transport, and property size. Are there any weaknesses in these factors that can be optimized in your property?
- The franchise groups in the local area will always be a good opportunity for tenant enquiry and new leases. It is simply a matter of understanding the properties that they are looking for. It is likely that they will have specific lease terms and conditions that apply to any premises that they negotiate on. You will need to brief your landlord on the standard terms and conditions that the franchisor requires. The franchise agreement needs to integrate with the lease of the premises. Your landlord needs to understand that fact so that the business can operate within the branding and business agreement requirements of the franchise group.
- With any larger retail property, it pays to stay ahead of any lease issues. They include rent reviews, options, and lease expires. Look at all of these events at least 12 months in advance. This then allows you to plan the interaction with the tenant given the conditions of the local property market.
- If you want to be a retail leasing expert, grow your knowledge with regard to business viability and different business types. Some businesses have different requirements as to cash flow and occupancy costs. If those requirements are exceeded, it is likely that you will have an unsuccessful and volatile tenant. Ultimately that will mean a new vacancy.
- With your existing tenancy mix, consider the factors of expansion and contraction as they apply to each particular tenant. Help the existing good tenants within the property to adjust the leasing needs and remain in occupancy.
- The anchor tenants in a retail property are very important to the overall success of sales, specialty tenants, customer visits, and market rental. Stay close to the anchor tenants as part of an ongoing lease strategy.
- Retail leasing and shopping center performance are quite unique strategies to be developed for each landlord and property location. It is not unusual to have a business plan developed for each medium to large property. In that plan you will have income profiles, expenditure management, maintenance plans, tenancy strategies, tenant retention solutions, and reporting requirements.
Retail shop leasing is perhaps one of the most interesting and rewarding segments of the property market today. That being said, it does require people that understand retail business and property viability.
In commercial real estate agency it is very much the case that the day will take over your diary unless you take control. People will impose on your time and things then will go absolutely nowhere.
If you are like me, you will hate people wasting your time. In our industry time is money and we need to remember that. In an average day lots of people will want a slice of your time. How about this list for starters?
- Existing clients with their listings
- New clients wanting to list their property
- Team leaders wanting to talk about the weeks results
- The boss (for all sorts of reasons)
- Tenants looking for property
- Buyers wanting to inspect your listings
- Telephone enquiries
- Administrative people needing help getting your marketing campaigns underway
So, all of this says that we need to set some solid rules that will not be broken or changed. We must control our time as it is the main thing that we can control in commercial real estate agency.
Systems can set you free to get on with your business. When business runs smoothly then you find the clients and the listings that you need.
Every system in commercial real estate is essentially made up of subsets or systems for key things. Each part of the process can be refined and improved. I have had systems for all of the following:
- Prospecting systems so I can keep focused on the right properties and clients that will need my services one day. Every good commercial agent should have a pipeline of some type.
- Presentation processes so that every property that I pitch for is a deliberate pitch that is well controlled to a solid approach that I know works. Confidence here is the key.
- Listing systems for each property type such as office, industrial, and retail property. I would also have systems for sales, leasing, and property management. Retail shopping centres are quite different and feature with their own systems that are unique to retail.
- Inspecting a property is quite special and having a process for that is wise. A checklist to help you ask the right questions and look at the right things in the property will always be of benefit. The inspection system should take into account the property type and the location; that is why you need checklists for this.
- Marketing processes for the listings that we work on should not be generic or ordinary. The fact of the matter is that each property should be uniquely promoted to a plan; this assumes that it is an exclusive listing and you have vendor paid marketing funds paid in advance.
- Negotiations and communications with clients should be documented. It is common that things will get delayed or changed when you are negotiating with a client on a sale or a lease. When you have the supporting documentation and notes, nothing can go wrong.
If you are finding that things are out of control and you are struggling as an agent, take a look at your systems in commercial and retail real estate agency. Build some processes and controls that help you move forward.