Sales Pitch Topics for Leasing Agents

There are differences to consider in a sales pitch for a lease listing in commercial or retail real estate. You are working with elements of rent, vacancy factors, supply and demand, property types, and certain target markets of tenants. Landlords need a bit of help in knowing how you see the ‘attraction factors’ that apply to their property. Tell a story about their property and how you will move on the leasing requirement; demand exclusivity for your intense focus and time commitment.

Before going too much further here, it should be said that the leasing part of our business is very lucrative as you can connect with plenty of local landlords and that can lead to sales appointments over time. Be prepared to work with lease listings and convert them; go ‘deeper’ and make direct calls to local or targeted tenants.

Quality is important in working with lease vacancies and the different properties. That is a rule to ‘live by’ in brokerage. Choose the properties that are likely to create tenant interest. Know what motivates a tenant to look at or take up a property. That knowledge can be gained and used as you talk to plenty of local businesses.

 

Listing Facts for Presentations

Take every potential lease listing and do a ‘SWOT’ analysis before you engage with the landlord client. You are then prepared to ‘pitch’ for the listing. Here are some things for you to talk about with the landlord as the client for you:

  1. Levels of enquiry – show the landlord what is happening with the inbound enquiry and list the questions by a group as to what tenants are looking for. Will the landlord’s property satisfy that list of questions?
  2. Property types – put the client’s property firmly in a property grouping for the zone. At that point, you can then tell the client what they are up against with other listings and lease offerings.
  3. Location preferences – explain how different tenants look for location advantages such as roads, transport points (ports and airports), location to end users or markets, and other local businesses. Some locations are more attractive than others when it comes to those elements.
  4. Target marketing – shortlist a few tenant types that will be valuable in the target marketing process. Your promotional strategies can then be direct and deliberate as you spread the word about the property. Tell the client how you will do that.
  5. Local area comparisons and coverage – list the competing properties in the precinct, and then take some photos, get the property facts in each case, and look at the strengths and weaknesses of each property. The competitive position for the listing is then something that you can talk about with the client and make some clear recommendations.

In saying all these things, simplicity is important in what you say, do, show in the listing process or pitch. Help the client see and hear how you can move things ahead with a direct focus on results. That is the best way to pitch for a commercial real estate lease listing. Be different, real, and relevant to the property and the client.

Shopping Center Managers – How to Reposition and Improve a Retail Shopping Center

Any shopping centre today can be a challenging asset from a performance perspective.  There are many challenges to track, balance, and manage.  The skills of the property manager and or leasing manager applied to the task will be critical to asset performance.

Fees for services

It should also be said that the fees to manage any retail property are also usually higher than the fees charged within industrial or office property management.  The skills of the people deployed on the property will reflect on the asset outcomes, so you must employ the right people for the task.

People Costs

Good quality people with the retail experience will cost more from a salary perspective.  The property outgoings should (subject to local retail leasing laws and regulations) be structured through the leases for management fees and staff salary recovery.

Taking on a new property?

If you are taking on the management of a shopping centre from a previous owner or previous property manager, there are many things to look at immediately and specifically.  Getting things under control quickly should be a priority with a retail asset.  You can use a checklist for that process.  Here are 4 specific ideas to help you get started:

  1. Arrears – Let’s start at the money or rental end of property performance. Understand where the rental arrears are and why they are happening.  Separate strategies will be required to get those things controlled.
  2. Vacancies – What and where are the vacancies now in the property and how are they impacting customer and tenant outcomes? Look at filling the vacancies quickly even if you must do short term rentals at lower base rents.
  3. Tenants and tenant mix – Assess the tenants in the property for current issues and volatility. A weak tenant mix will drag down property performance.  Talk to the tenants and ask about customer sales and customer requirements.  It is very likely that the tenants will know what is needed in a retail property to resolve shop placement and mix problems.
  4. Income and expenditureReview the cash flow results for the property over the last 12 months. You will see the timing factors from high cost issues such as rates and taxes, as well as capital expense items.  Then look at current rental levels, vacancy factors, and upcoming rent reviews.  From these things you can create a budget for the property.  The object here is for you to comprehensively control the money coming into the property and flowing out to the various stakeholders.  You can then shape the financial factors of the property in a controlled way into the future.

These 4 factors will lead to greater property understanding and control.  When you can see what is happening in the retail property or shopping center, you have something that you can base your future strategies around.

You can get more tips about Shopping Center Management and Leasing in our eCourse right here.

How to Choose the Right Commercial Property Management Software Solution

In commercial real estate brokerage today the property management division of your business will need a dedicated and specialised property management software program to control asset performance for the clients that you serve.  There are many different software packages around, some of which are of the highest quality, whilst others are very average.

Quality is important

If you plan to provide a professional property management service across the best buildings in your town or city, then you will need a high quality software program that can comprehensively cover the needs of the clients and the challenges of the properties.  There are significant and different management requirements across industrial, office, and retail property types.

In saying that you do need to choose the right software program, there are costs associated with all of the specialised solutions available.  Most of the high quality programmes are reasonably costly although they can be easily funded by the correct management fee structure and a good size property management portfolio.

Understand the reporting solutions

If you want to attract the best clients to your professional property management services, you will need a good software solution to support your activities.  You need something that is well proven and cost efficient, and yet something that is easily able to produce the reports that the clients require.  An informed client is more readily able to make the best decisions in a timely way.

Know what you must control

Understand the informational needs of the clients that you serve across an array of activities.  Consider some of the most common challenges that you strike on a regular daily basis, including:

  • The lease documentation and updates
  • Tenancy mix details and variations
  • Expenditure activity across the various cost codes
  • Arrears controls and reporting
  • Regular tenancy correspondence and communication
  • The landlord reporting requirements and report formats
  • Property maintenance records
  • Risk management and documentation
  • Energy management and tracking
  • Environmental issues and controls
  • Income controls and optimisation
  • Rental strategies and budget expectations
  • Property budgeting for both income and expenditure
  • Premises and area detail
  • Tenant contact, correspondents, and records
  • Outgoings activity and performance
  • Cash flow projections

So these are some of the most common requirements in most commercial property management activities.  At a minimum, the software solutions that you use need to cover these and other issues effectively and directly.

The Categories?

You can see from the list that some of the matters are financially orientated, whilst others are linked to documentation, and also tenancy mix occupancy.  One software package has to cover all of the issues in an accurate way.

Choose the best commercial property management software package that suits your typical client profiles, property types, and property portfolios.  Understand the factors of growth that will occur with your property portfolio so that the selected property management solution you choose can give you the best ongoing support into the future as the portfolio grows and building complexity increases.

You can get more commercial property management tips in our eCourse ‘Snapshot’ right here.

Why Confidence is so Important in Commercial Property Management

The clients that we work with in commercial property management expect experience and confidence in the managers that they use.  Those clients like to know that the person chosen to manage their property can handle the variables of income, expenditure, tenant mix, and lease negotiations.

So why worry too much? The experience and confidence in any property manager will be important to the client service process and also to the brokerage fees charged for services rendered.

Inexperience is Dangerous

An inexperienced property manager can be a costly and concerning problem in property performance for any investor.  Invariably that is the time when errors and omissions occur with the critical factors and tenancy activities.

So the property manager needs the confidence, knowledge, and experience to know how to look for upcoming concerning issues in the leases and with occupancy, and how to position the property for better results in investment outcomes.

Every landlord and property owner will have certain unique targets to merge into that property performance equation, so the balance becomes a bit tricky.  That is where the right property manager for the asset and the client should be considered.

The complexity of many office and retail properties requires specific experience and knowledge to help the property stay on track from an investment perspective.  Errors or omissions create problems with any property and its performance.

Critical Confidence Factors

Here are some ideas to help you with this.  Any property manager should be specifically familiar with the following topics as they apply to the location, the client, and the property type:

  1. Income – The levels of income in any property will be impacted by local vacancy factors, current market rentals, and business sentiment. If a property is to grow its income base with rentals that are market aligned, the property manager really does need to have advanced skills with tenant management and property leasing.  Remembering that many leases exist for a number of years, the property manager is the person responsible for qualifying the tenant, then establishing and growing the cash flow.
  2. Expenditure – Rarely will property expenditure decline and that is why a specific budget is required to keep property expenditure under control. Energy costs, operational costs, and property usage place pressures on expenditure each year.  Operational costs within most properties are escalating.  There are seasonal factors to look into as well including climate conditions, and the associated energy consumptions.
  3. Tenant placements – When you have a number of tenants within the same Investment Property, you will have challenges when it comes to positioning, occupancy, and property use. Some tenants have an impact on other tenants around them.  As part of any lease negotiation, specifically choose the right tenants for the right location and then control them within the existing lease documentation.  Understand the businesses in each case and the types of people that will be accessing the tenant and or the property.  What pressures will happen as a direct result of tenant existence and occupation?  You may need to put certain controls within the lease document to keep things on track within the tenancy mix.
  4. Lease negotiations – Every lease negotiation should be looked at in balance allowing for current market conditions, vacancy levels, market rentals, and the locations of other tenants within the property. Some leases will come to an end within the same property at a particular point in time.  Most owners cannot afford to have escalating vacancy factors across a large percentage of the property.  Negotiate your leases so that the cash flow of rental is not overly impacted by lease expiry dates.
  5. Vacancy strategies – Like it or not vacancies will happen in any property. The impact of those vacancies can be lessened through finding new tenants, moving tenants around, and modifying the property use.
  6. Maintenance strategies and costs – During the year things will happen in any managed property. You will have maintenance issues occurring for all types of reasons, and some of those repairs will be timed whilst others will be unexpected.  You need response systems for all levels of maintenance including emergency responses.

Are you ready to improve your confidence and knowledge in commercial property management?  A successful property management division in any brokerage will bring many advantages to the business over time.

You can get more commercial property management tips in our Snapshot eCourse right here.

Commercial Real Estate Leasing Brokers – The Additional Benefits of Working with More Local Tenants

If you are a commercial real estate leasing agent, you can get plenty of market traction if you work with local tenants and business owners.  They tell you things and that then leads to listings and better commissions with quality property transactions.

Always err on the side of leasing quality when it comes to any property listing or property choices.  Why is that?  Consider these things:

  • Quality properties create better levels of inquiry
  • The rents are higher per unit of area
  • The commissions are better due to the higher rents
  • The tenants are drawn to a quality listing
  • Modern buildings offer a level of improvement and services that most tenants require

What are the Leasing Positives?

There are some good things evolving from working in property leasing and resolving tenant needs.  Think about these:

  1. Leasing leads to Property Management – Many landlords are open to property management services when you have just solved a complex leasing issue for them.
  2. Leasing leads to Sales – A lease today is likely to be a property sale in the future, particularly if you do a great job for the landlord property investor.
  3. Tenants share local property information – Local tenants will tell you many things about their location and other nearby businesses.
  4. Landlords want help with tenant placement and tenant mix – Whilst a landlord may have a fully occupied property right now, many leases may be in need of upgrade and renegotiation at the right time in the future. As a general rule, weaknesses in leases can be negotiated away over time with better leases and rents.
  5. Rental and lease strategies are highly specialized – There are many different types of rents and leases; they can be mixed and matched to the investment requirements of the landlord and or the occupancy needs of the tenant (it just depends on who you are engaged by as a client). You can drill down into market rent strategies and leasing alternatives.  That will then make every lease negotiation more valuable for the clients that you serve.

So you can do a long way in the property market as a specialized agent or broker by starting from a ‘leasing base’.  Understand the linkages between the 5 points mentioned and build your skills and property market around them.

In closing on these points, recognize the differences between office, retail, and industrial property.  Understand the leasing opportunity in each property type, and then choose the segment that offers you the most market activity over time.

You can get more commercial real estate broker leasing tips in our ‘Snapshot’ eCourse right here.

Commercial Real Estate Agents – Control Your Tenants for Better Leasing Results

In a commercial or retail property today, it is the tenants that provide the backbone and the stability to income and rental performance.  On that basis, you really do need to keep your tenants well in control given the prevailing market conditions and the current tenancy mix.

It is notable that a retail property can be highly volatile when it comes to tenant interaction and occupancy.  Essentially all retail tenants are essentially small business people that rely on the success of the property and the overall tenancy mix to provide an opportunity for sales growth.

The tenants in a retail property will usually talk between each other on a regular basis.  They therefore share information and perceptions relating to the property, the property manager, and the landlord.  I go back to the point, that you must not let your tenants get out of control.  Encourage good communications and build solid relationships with all of your tenants.

Here are some rules to apply to the tenant communication and connection process in commercial and retail property today:

  1. The tenant will be assessing their business performance continually during the year and the lease term.  This then says that you should meet with your tenants on a monthly basis.  This will help you when it comes to understanding shifts and changes relating to their business, customer base, or sales.  If you identify any problems early, you can make the necessary adjustments to occupancy or leasing strategy.
  2. In a large property, it is likely that you will have one or more anchor tenants as part of the tenancy mix.  The anchor tenants will usually be in occupancy for the long term with a lease document that extends over a number of years; in most cases the lease for an anchor tenant will be in excess of 10 years and will have options for lengthy renewal terms.  Stay close to your anchor tenants so that you can understand how they are integrating into the overall property and any associated specialty tenants.  The success of the anchor tenant will have some flow through to the specialty tenants.
  3. Most leases will have provisions for rent reviews and options as part of occupancy.  The critical dates that apply to those lease situations should be carefully watched.  Any rent review or lease renewal inside the next 12 months should be negotiated as early as possible.  This then will remove the volatility from the property for the landlord.
  4. Every meeting or conversation with a tenant should be documented as quickly as possible.  Whilst a simple situation or discussion today with a tenant may seem unimportant, it is quite common to have more complex issues arise in the future that started from some simple discussion or telephone conversation.

Get to know your tenants as part of the services that you provide for your client the landlord.  In this way you can help the client understand the predictable changes that you can see with the tenancy mix and the lease profiles.

Top Leasing Agent Formula for Success in Commercial Property

In commercial and retail property, a top leasing agent will make a lot of commissions.  That is because they specialise.  They know the local businesses that are looking to move over the coming years and they work towards putting the right deals together.

In reality, landlords need the top leasing agents to help them that really understand the local area.  Those top agents will have their market covered in a comprehensive database of tenant movement, lease strategies, rent alternatives, and marketing ideas.  Finding the right tenant for the right property is a real skill.

Landlords do not need an agent that just knows how to lease.  Anyone can put a sign on a property and list it on the internet.  When you are a ‘top agent’ you will have the market coming to you because of that intense and relevant market knowledge.  You will also know who are soon to be moving and for what reason.  Market intelligence is invaluable in our market today as businesses change location and seek better leasing deals.

These are the skills and knowledge factors of a top leasing agent today:

  1. They have a comprehensive awareness of what all the local tenants are doing in their current leases.  They know when those leases will expire and will work towards helping those tenants in the last year of their lease to find something of better value or relevance to the business.
  2. They know where the successful businesses are that will need property change.  They look for tenants in pressured occupation.  Expansion or contraction factors are major triggers when it comes to property leasing.
  3. Top agents know the landlords of the area and the best properties that create the major interest.  When you can relate to those properties and the existing tenant mix, you will soon see property change and opportunity in each.
  4. Rentals will change from property to property and location to location.  To a great degree, the rentals in any location are driven by the rate of tenant enquiry and the supply and demand for leasing space.  As part of that equation it is wise to keep a close eye on the upcoming property developments in the local area.  It takes about 2 years from approval to completion when it comes to getting a new investment property established.  That being said, the property developer will be offering some very real incentives to attract tenants even before the property comes out of the ground.
  5. Lease terms and conditions are sometimes standard to a property or landlord, but they will also be influenced by the rate and type of local property enquiry.  A lease that is offered for a vacant space should be matched to the prevailing market conditions and current lease enquiry.  You may need to create incentives to attract that lease enquiry.
  6. Franchise tenants are a good source of lease enquiry.  Top agents work the franchise groups to find the right properties that suit them.  Those franchise groups will have a priority in location and lease terms.  Get to know what the franchise groups want.

To be the best leasing agent, you can dominate your market when you know what the tenants, the landlords, and the properties are doing.   Isn’t that what we should do anyway?