In commercial real estate you must prospect for new business every day. In that prospecting time, 50% of the time should be spent on people that you already know and are progressing up the contact pipeline, and the other 50% should be spent on the new people and property owners that you have not spoken to before.
When you follow this model of prospecting, you find that your market opens up with opportunity; the clients and contacts that you know will expand. From that action plan you see the new business that you need.
It is a fact that many agents if not 90% of agents do not prospect enough. They like to find excuses to move on to other things. When they get busy, the first thing to be avoided or removed from the diary is prospecting. That then leads to a market downturn and decline in listings and then commissions.
Here are some rules for prospecting in commercial real estate:
- Don’t work with a small group of clients and prospects. This will expose you to loss of income when a client moves away or stops activity in property. It is better to have your main client list (the ‘A’ list) and then a secondary client list that you can move into or escalate when the ‘A’ list is shrinking. As a general rule you should have an equal number of people or prospects in your ‘A’ and ‘B’ list. Prospecting on a regular basis will help you with the numbers in each group.
- Know what your idea client looks like and where they are located. When you get focused on a specific client you can target your prospecting for better effect. Top agents tend to focus on clients with large properties or portfolios of multiple properties.
- Know what your ideal property listing will be and where it is located. This focus helps you with organised prospecting. Keep to a geographical area so you can methodically go through your region with focus on properties and clients.
- The prospecting efforts between sales and leasing, versus property management are a bit different. The best agents can work with sales and leasing quite well. Be aware of the property management opportunity and have someone to service it with you or for you. That being said you will need the right people in the agency business to take on the workload. Commercial property management is quite special. The same can be said for retail shopping centre management.
These are quite simple rules to follow; simple to create, but hard to do. Prospecting reluctance is a big issue for some agents. Take on the task and get better at it. Soon the business will come in.