The Perfect Leasing Strategy for Commercial Real Estate Agents Today

Commercial Real Estate Agent giving Ok handsign
Leasing in Commercial Real Estate Agency today requires real specialists.

In today’s commercial and retail property market, you really do need to develop a leasing strategy for each and every quality property that contains vacancies.  The abundance of vacancies available means that the limited pool tenants available has a lot of properties to choose from.  Attracting enquiry from tenants and then converting the enquiry is a real ‘art form’ in this market.  Here are some more tips from our Newsletter for Agents.

It should be said that the marketing of any lease or vacancy should be on an exclusive basis.  You should be appointed as the agent of choice to market the property for a period of time.  Controlled listings are the only way to attract enquiry in this market today.

Given that the landlord requires leasing results in their property, the controlled listing is the only way to achieve the necessary commitment on the part of the agent and the necessary market penetration into the tenancy base.

It should be said that the client’s commitment to an exclusive agency should also be reflected in the agent’s commitment to market and service the listing.  There is no point in taking on an exclusive listing of a vacant tenancy unless you truly believe that you can market it comprehensively and intensely for the period of the agency.  The real estate world is full of disgruntled clients who have been tied to an exclusive agency and a poorly performing agent for a long period of time.

To provide an excellent leasing service for your clients today, here are some tips and ideas to merge into your leasing strategies and solutions.

  1. When you act exclusively for a particular landlord, the property portfolio that they own should be subjected to a tenant retention plan and business strategy.  In that planning process you can set the key criteria that should apply to ongoing leasing activity and tenant mix changes.  When the landlord can clearly see the leasing road ahead when it comes to rentals and vacancies, they are more likely to stick with you as the leasing expert that they require.
  2. The market rental in your local area will change from time to time given the supply and demand for rentable space.  New property developments will place pressure on market rentals through the introduction of lease incentives and enticements.  Keep your client up to date with some form of market rental update on a monthly or quarterly basis.
  3. The expenditure or outgoings costs for a given property asset will be based on both controlled and uncontrolled cost factors.  The uncontrolled cost factors are those that relate to property rates and taxes.  Like it or not they will have significant impact on property usage and will need to be paid.  It is the controllable outgoings that have some ability to be shaped relative to occupancy and building usage.  As a leasing strategist and specialist, you can keep the client appraised regards current levels of expenditure and outgoings that apply to the particular property type.  The trends of outgoings costs will to a large degree influence your rental decisions regards amount and rental type.

To be a top leasing agent today, you simply need to bring relevant leasing skills and local property knowledge to the client.  Provide the best leasing service possible to your clients, and keep in touch with the local business community for the tenancy needs that arise.

You can get some more tips on leasing strategies from our online Newsletter for Agents.

The Perfect Cold Call in Commercial Real Estate Agency Today

commercial real estate agent on the telephone
You can perfect your cold call process in commercial real estate agency.

Most commercial real estate agents hate cold calling and will avoid it at all cost.  That simple decision costs them dearly in market share, leads, and opportunities.  If you are in the industry by choice, you will need to do some ‘hard stuff’.  Telephone prospecting is one of the most important to do.  Here are some tips for agents from our Newsletter.

Master Cold Calling

To work in commercial real estate agency you have to master the cold calling process.  Each day you should spend 2 hours on the telephone talking to new people that you have not spoken to before.  It is a time factor that requires discipline and focus.  If you can master the art of call prospecting, then you will rise to the top of your market a lot faster than most.

The big factor in moving ahead in the industry is for you to practice and refine your call contact processes.  Who should you call?  Here is a list:

  • Property owners
  • Property investors
  • Business owners
  • Owner occupiers of commercial and industrial property
  • Tenants
  • Property developers
  • Property professionals (solicitors, accountants)

When you look at a list like this you will soon know that some of these people are hard to find and contact.  For that reason you should call the people that are easy to find first and then research the rest on an ongoing basis.

Keep it Simple

Business owners are simply taken from the telephone book or by researching the businesses located in the streets in your territory.  You can call 40 of those per day quite easily.  As to how many you get through to, the number will be less than half; that being said, you simply make the calls and keep doing so.

In contacting property owners you will find that the process is slower and more tedious.  That is because the property owners can be hidden inside company structures or property trusts.  Allocate yourself a target of researching 1 new property owner per day.  At the end of the week you will have spoken to 5 new people that have a solid interest in quality property.  Over time that connection will pay dividends when it comes to leads.

Watch Out!

Making all these telephone calls is one thing, but you should be aware of the ‘Do not call register’ and legislation or laws that could apply in your area.  Do not break the law when it comes to making calls.  In most cases, the business people and owners that you call are not impacted in the same way that private people in residential situations may be.  Understand the calling laws and stay within them.

The perfect cold call is a systemised process that occurs every day to a plan.  You can develop your dialogue, call contact systems, database, and follow-up systems to take you forward.  Start practicing and you will get there faster.

You can get some more tips for Commercial Real Estate Agents in our Newsletter.

Commercial Real Estate Agents – Property Developers are Worthwhile Contacts to Have

two business men talking in street
Understand property developers and their priorities before you act for them.

In commercial real estate agency, you will come across many property developers.  They are useful people to know given that they will take on new projects from time to time.  New properties and new developments are a great opportunity for bulk commissions.  Project leasing work will emanate from new property developments.

Here are some tips from our Newsletter.

The focus of the property developer is to put the project together given the requirements of the local market.  They require the assistance of a good agent to solve the leasing challenge or the selling requirement as the case may be with the new property developments.

All of this being said, there are good property developers and some that are not so good (I guess they will say the same of real estate agents!).  If you are going to work with property developers, make sure that you have a valid and enforceable appointment to act and that your fees are well defined.

Here are some rules to apply to the project work with property developers:

  1. Trust is very important from both parts of the property equation.  They need to trust you and your skills in moving the property.  That’s why they focus on the choice of agent and will normally appoint the agent with a proven track record in project leasing.
  2. You need to trust the developer and his ability to pay your fees for the hard work that you put in.  They will usually ask you to do a lot of work ‘up front’ to help them get the project together with their financiers.  This work may be for no fee at all, but you should at least have a long term appointment signed on the property before you get involved in ‘free’ advice.
  3. They are likely to cut your fees and delay your fees (it’s a common problem), so be prepared for some difficulties there.  The basic message is do not work for a developer that is less than honest in payment of fees.  Over time they will usually self-implode because no-one will trust them.  They need a good agent more than you need them.
  4. Check out the other projects undertaken by the developer before you commit to serving them on an appointment to act.  A successful developer will have left a trail of good property projects locally.

When you get involved with these developers, be aware of the commissions you want and how you want to be paid.  Every part of the project sale or leasing should incur a commission that is fair and relevant for the work involved.  Do not provide discounts to the developer to win the work; he or she is likely to make you earn every dollar of your commission that you make.  Be prepared for a strong but challenging business relationship.

You can get more Commercial Real Estate Agent tips like this in our Newsletter.

Lease and Tenant Mix Checking in Selling Commercial Real Estate Today

people walking in shopping mall
Review all leases and tenants when selling or leasing commercial or retail property.

When you inspect a commercial property for leasing or for sale, the existing tenant mix should be checked and referenced against the current leases.  It is remarkable just how many problems you will find with the property when you do that.

Many landlords and property managers are not accurate and up to date when it comes to lease activity and critical dates from the leases.  This then produces problems later when the property is sold.

Here are some questions to help you with lease reviews and tenant mix status.

  1. Who are the tenants in the property today and what leases allow them to be in occupancy?  Are those leases all current and up to date when it comes to options and rent reviews?
  2. What outgoings are to be paid under the lease and are they full up to date?
  3. Are there any arrears outstanding in the property and if so why?  Any disputes with the tenants will need to be resolved if the property is to be taken to the market for sale.
  4. What do the tenants think about the landlord?  Could that impact the sale in any way?
  5. Should some of the tenants have their leases renegotiated as part of preparing the property for sale?
  6. What does the tenancy schedule for the property say about the tenants and the leases?  Does the information cross reference accurately with the leases and the actual tenant location in the property?  You will need to check this yourself.
  7. Who is the tenant point of contact and how can you contact them to inspect the property before the marketing is to commence?
  8. Do the tenants need more or less space in the building?  Should that requirement be addressed now as part of moving the property to sale?
  9. Do the tenants comply with the permitted use for the premises as outlined in each lease?
  10. Are there any renovation or relocation clauses to exercise as part of preparing the property for sale?
  11. Are there any outstanding issues relating to make good of tenant premises that need to be addressed?

You can add to this list based on the property type and the location of the property.   All of these checks and balances are a requirement of preparing to market and sell a commercial or retail property.  Your diligence in the process of checking tenants and leases will save a lot of issues and problems later.

Get more tips from our Newsletter.

Commercial Real Estate Agency Staffing Strategy

Real Estate Agents sitting at table
Get your sales team and administrative team in commercial real estate to work together.

In a commercial real estate agency you have to be really careful how you integrate the sales and agency team with the administrative team.  The job roles and specifications must be carefully set so that both arms of the business work to the common goals of market share and commission.

The administrative people in your agency are the ‘processors’ of the business whilst the agents and salespeople are there to bring in the new business.  I know that statement may upset some very hardworking administration people; the fact of the matter is that they would not have a job without some successful salespeople bringing in the listings and the leads.

There are a couple of problems in the commercial real estate industry that need to be made clear:

  • Top agents need support.  If this is not done they will either lose focus on the paperwork that has to be done, or they will spend too much time on the paperwork and the commissions will fall away.
  • Many top agents are not good at the paperwork side of the business.  Whilst there is no excuse for this, it is a common problem in the industry and team leaders should deal with the problem.  Everyone in the team has to work together in harmony.
  • The administrative staff should be chosen for their ability to support the sales team.  On that basis they should be checked out as to a character of ‘cooperation’ and their administrative skills.  Uncooperative administrative staff can destabilise the business and the output of the sales team.
  • The members of the sales and agency team should respect the value and services of the administrative staff.  In this way more work and better results will occur.

The salespeople that you employ in your real estate business are there for one thing and that is to generate business.  Every day they have to prospect, cold call, market properties, meet clients, take inspections, and process listings.  In all of those things there is a lot of paperwork.

You cannot have the sales team ‘bogged down’ with paperwork.  Yes, they do have some paperwork to do and it must be accurate.  The burden of mundane and ordinary paperwork can be lifted from the team with a good administrative support team.

How many salespeople should you have for one administrative person?  With ordinary salespeople that are not yet at the top of their game, the ratio is about 3 salespeople to one support person.  With more sales and listing success that ratio will change.  Top Agents will usually have one totally dedicated support person working for them.

If you want more tips to build your commercial real estate team, you can get them right here.

Commercial Property Leasing Agents – Landlord Report of Leasing Activity

people walking through a retail shopping centre
Provide a comprehensive leasing report to landlords about your leasing activity.

In a commercial property today a landlord has to be fully briefed on lease and tenancy matters if property performance is to be optimised.  The process of reporting to the landlord is a key part of the role of a commercial or retail property manager.  The reports should be comprehensive and provided monthly together with the financials for the asset.

The aim of the lease and tenant report process should be to optimise the tenant mix and control the rental cash flow.  The landlord for the property will have a plan and targets that impact rental, vacancies, tenant selection and refurbishments.  That is why each property should have a property business plan that is established for the plans of the landlord and then regularly updated.

At the start of any asset management service, the property manager should interview the landlord to understand the factors that are important to property function and income.  The reporting and control plan can then be established.

Here are some topics to incorporate into the landlord monthly report:

  1. The income for the property will be of key focus to the landlord.  The income will be impacted by the leases, and on that basis, the manager of the asset will need to understand each tenants lease comprehensively.  Care needs to be taken with critical dates and income rental charges.  In some cases you can find that the critical dates in the leases are based on dates where ‘time is of the essence’.   In that case action is required by the selected dates.
  2. Changes of rent charges will be relative to the lease and any agreements that the landlord and tenant have.  Everything of that nature must be in writing.  Good records will help you stay on top of rental changes and charges.
  3. Outgoings recovery will be based on the occupied areas for each tenant.  That recovery will have a relationship to the lease for each tenant.  Some leases have limitations on the outgoings that can be recovered so care should be exercised in checking that information for any reconciliation of rental and tenant payments of outgoings.
  4. Market rentals will change from time to time based on the area in which the property is located and the property type.  On that basis the monthly report to the property owner should have some update on market rental trends and changes that could impact any upcoming market rent assessment in the property.
  5. Lease expiries coming up should be tracked and recommendations be made early to the landlord so the vacancy downtime can be managed and minimised.  In such situations it pays to work 12 months in advance so that problems of vacancy can be solved early.

The report to the landlord of a managed property should be seen as a tool of control and record.  When it is done well it can help all parties involved with the property make the right decisions in a logical way.  Want more information?  Subscribe to our mailing list right here.

 

6 Key Location Based Marketing Tips for Commercial Real Estate Agents

city high rise office buildings
Market every commercial property comprehensively and locally for sales and leasing.

In commercial real estate agency today, it is a fact that most of the marketing results that you will get will be locally based.  For this reason, it is very much the case that every property and every listing should be extensively marketed locally.  That is where you will find the buyer or the tenant.

The suggestion is that you should focus at least 75% of your marketing effort into the local area.  That is with both the marketing for each of the property listings, and also for you as a commercial or retail property expert.

At a local level you will achieve far more results for the given amount of marketing and advertising effort.  It is also a lot easier for you to talk to the changes and events in the local area when it comes to property trends, prices, and rentals.

Here are some ideas to help you with that promotional strategy in commercial and retail property sales and leasing.

  1. Local businesses are the backbone of the industry when it comes to property occupancy or ownership.  The local businesses and or their proprietors will tell you so much about the local area, the neighboring properties, and the changes in the precinct.  This market intelligence is invaluable; on that basis your objective should be to meet with many business owners on a weekly basis.  That will require cold calling and prospecting in a systemized way.
  2. Local property owners are always interested in hearing about the changes to property occupancy and marketing likely.  Finding and speaking to those local property owners can be a real challenge.  The basic problem is that they can hide behind company structures and property trusts.  Identifying them is the first problem, and then speaking to them personally as the next.  That being said, they should feature as part of your prospecting model so that you can build your local database over time.
  3. Work around your listings at each and every opportunity.  Every new listing that you get in your territory, town, or city, should be personally marketed to all of the adjacent property owners and business proprietors.  The ratio should be about 50 to 1.  This suggests that you should talk to 50 people around each single listing.  The amount of local market information and intelligence that you get will be very useful.
  4. Work around other agents listings on a regular basis.  Most other agents will simply put a sign on a property and not do the necessary surrounding precinct marketing.  When it comes to the listings of other agents, any adjacent businesses and or property owners may like to compete with the listing nearby.  That can then be an opportunity for you.  You can feed enquiry off your signboard given that it will be seen by those parties that inspect the other agents listing.
  5. Signboards are very important when it comes to local marketing.  As a general rule, signboards should be placed on every listing.  Your name should feature on the signboard to build the personal branding reputation that you require.  When you get more signboards into your territory, you will get more enquiries.
  6. Internet strategies are quite unique when it comes to local property marketing and commercial real estate agency.  You can do some very specific things to build your reputation locally as the expert with your property type and location.  Some of the most effective Internet strategies for commercial real estate agents are blogging, article marketing, twitter, Linkedin, and Facebook.  All of these initiatives are individual and personal to the particular salesperson.  You can build a very good online presence when you integrate all of these factors into an ongoing marketing campaign.  The secret to the process is in regularity of posting and local relevance.

When you take the above points and shape them into your personal marketing campaigns, the branding that you will achieve will be significant.  That will then help you build more listings and of better database.