Strategies for Tough Clients in Commercial Real Estate Agency

Real estate agenct and client in car
Develop firm skills with tough commercial real estate clients.

When you work as a commercial real estate agent, you will come across clients of all types.  It can be said that the business community breeds some very difficult customers that buy, sell, and rent commercial property.  To deal with this, you need to have a mindset and a strategy to handle the difficult clients in a particular way.  Here are some tips from our Newsletter for Commercial Agents.

One of the biggest concerns regards difficult clients or customers is that many will go behind your back and do the deal direct with the property owner, tenant, buyer, or landlord as the case may be.  You will lose control of the deal.  Clients and customers of this type cannot be trusted and when it comes to commercial real estate, are likely to be the source of many problems.  They commonly seek shortcuts or savings to the detriment of the property agent that introduced them to the property.

First Rule

As a common safeguard measure in commercial real estate, always take notes of your discussions and meetings with clients and customers.  Keep all of your notes on file and readily available for the time that the transaction becomes difficult or disagreements occur.

Second Rule

The second highly important rule in your commercial property profession is that you must have a legally valid appointment to act on each particular property.  Verbal agreements to pay your commission are not ‘worth the paper that they are written on’.

Your agency appointment must be accurate in every respect so the client that you act for cannot avoid the commission process.  The appointment to act will also help protect you in the case of missing information, disagreement, or incorrect information provided by the client.

So what does a bad client or customer look like?  Here are some of the most common problems and issues that you will find in the industry.

  1. They do not pay the commission or the fees for the transaction on time and in accordance with the appointment to act.
  2. They seek discounts or reductions from the agent after the service has been provided and will withhold money as part of the negotiation process.
  3. They constantly complain to other agents regards the promotion and marketing of the property.
  4. They call you twice a day to check about your progress on marketing the property and who you have spoken to today.
  5. They distract you from doing productive promotional activity on the property.
  6. They interrupt you from other essential tasks and take up far too much time on unnecessary matters.
  7. They think that their listing is the only one you are working on and fail to let you get to other things with other people that you act for.
  8. They will not listen to reason when it comes to market trends and activity.
  9. They do not respond to your requests and correspondence relative to the property negotiation.

It should be said that some clients can be genuinely upset due to the poor performance of the real estate agent acting for them.  If that is the case, then their concerns are valid and justified.  It is however the other difficult client that chooses to be so for unknown reasons that needs a particular strategy of control.

As a general rule, difficult clients should be under serviced.  If they are deliberately difficult then the property agent should do what is correct and necessary, but not over service them.  In the longer term and when you find a buyer or tenant, that client is likely to not cooperate in any negotiation when it starts.

Pulling away from a difficult client will help your business grow.  If a listing is not working and the client is just not cooperating, it may even benefit you to agree to withdraw the listing from your books.  Let’s face it; a difficult client today is going to make any property negotiation slow and unrealistic.  When you find a difficult client, take the time to choose your approach and your method of working with them.  Act sooner rather than later with difficult clients.

You can get more tips like this at our website or join our Newsletter here.

By John Highman

John Highman is an International Commercial Real Estate Author, Conference Speaker, and Broadcaster living in Australia, who shares property investment ideas and information to online audiences Worldwide.