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How to Charge Top Commissions in Commercial Real Estate Brokerage

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In the commercial real estate industry, you will get plenty of pressure from your clients and prospects to reduce your commission or service fee.  If you truly believe that your services are superior in your location and with your property types, then fee reduction is not an option.

Ask for the appropriate fee for services to be rendered.  Talk about the value that you provide to the client and their property challenge, and then wait for an answer.  Be prepared to walk away from a fee reduction request if it is unfair or too onerous.

Desperation is not a good look in commercial real estate nor should it be the basis of your commission or listing agreements.  If you truly believe that you are offering a top-quality service, then ask for the fair fee, and stick to your request.

One thing should be remembered here when thinking about listing fees and commissions.  The client needs your services to resolve their property challenge to get the best outcome achievable and to do so in a timely way.  If you sell your services through those two points of focus, the conversion of the listing at a fair commission is quite achievable.

 

Who Do You Work For?

You do not want to work for clients that are unrealistic, or not aligned to the property market situation today.  Local area investigations will show you and the client what the chances may be of getting property enquiry and inspections underway.

So, a focused listing approach and presentation process will help you achieve better outcomes with your clients and with your service commissions.  Try these ideas for starters:

  1. Show that you understand the facts. That then is those facts relating to the client and their property and its position in the location.  Inspect the property with the client to discuss presentational issues, strategies, improvements, and tactics.
  2. Define a clear target market. Every property will be suited to certain target markets.  The more direct that you are in defining that fact will then help with client engagement and decision making.
  3. Tell a few stories. Property stories always help with a client conversation and decisions required.  Choose the stories that are best suited to the property type and the challenges faced by the client in today’s terms. Show that client that you understand the solutions required.  Talk about how you will direct your efforts towards solutions.
  4. Choose the best method of sale (or lease). There are different ways to approach the marketing of any property.  Make your choices for the client and give them some alternatives to work with.  It is then easier for the client to decide what they are doing and why they should act in a way as part of moving on your recommendations.
  5. Give real strategy to your professional approach. Don’t be generic in your business approach to listing or selling a commercial property.  The ‘common’ approach to marketing and negotiation should only apply to ‘open listings’.
  6. Give timelines to the campaign and marketing process. There are many things to do in marketing a commercial, industrial, or retail property.  Show the clients the stages of your approach and how they are so relevant to moving things forward.  Put yourself in the equation of property marketing and negotiating.
  7. Seek exclusivity for work to be undertaken, as that is the only way you can devote the required time to the client and their property. Show the client why your exclusive listing processes are superior in resolving their challenge today.

 

If you follow these rules, it helps you convert listings and achieve better commissions.  Always document the sale or lease agreement comprehensively and legally, so you do not have to revisit the commission discussion again.  Simply put, get into the marketing of the property and resolving the client’s property targets and obstacles in a timely way.

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How to Earn Easier Commissions in Commercial Real Estate Brokerage

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Step up in your commercial real estate business.

Commissions get easier in commercial real estate when you understand that one single listing or one deal can easily be used as the foundation for other things and particularly opportunities.   That’s when you can refine your actions and focus.

(N.B. these ideas are also sent out to regularly to our friends in Commercial Real Estate Online Snapshot to help amplify brokerage results…. Get your access here)

Take your single client, listing, or transaction and open up the opportunities that exist around you.

Need some more real estate business?

Here are the facts and some valuable ideas:

  • A good listing in any location can be the basis of making lots of calls to property owners in your town or city. Talk about your listings with the local people.
  • A signboard that you place on a property will be the foundation of connecting with nearby business owners and property owners. A signboard is a great business tool and will give you conversational leverage locally.
  • A quality property listing will (or should) be the origin of a door knocking program in your business precincts or territory. Get into your local area and talk to people about your listing stock.
  • Every time you get a call from an advertisement, ask the person calling you about what they have seen locally. They may have looked at other properties and therefore be an active buyer or tenant.
  • When you hold a property inspection, get the fuller perspective from the inspecting party about where they are now, what they are doing, where they want to be with their property needs, and when they have to do something. Ask good questions and make lots of notes.
  • List exclusively so that you can control your listing stock. Some agents just take on open listings for the sake of having a property on their books.  Whilst I can understand the basic idea, open listings give you little leverage and ability to grow your market share.  Exclusivity is the only thing with listing that will help you build your real estate business.
  • Know the market locally. Your comprehensive awareness of the listings, deals, negotiations, and time on market will help you through any client conversation and listing process.  Be prepared to quote the facts.
  • Build on your successes and tell the ‘world’. When you have done a deal, get the message out to your location, your database, and your clients.  Let people know that you are the person that has created a result.  Encourage them to talk to you and discuss what happened.
  • Look for referrals in each contact and relationship. Use the power of referral business to grow your database with ‘warm contacts’.   It is very easy to open a new opportunity from the basis of a referral.

This list is just the start of the process, and particularly so when you look at all the opportunities that are around you.

Every conversation, every lead, and client relationship can be expanded into something else.  Ask and you shall receive.

(N.B. these ideas are also sent out to regularly to our friends in Commercial Real Estate Online Snapshot to help amplify brokerage results…. Get your access here)