Great agents are top negotiators and will have had plenty of exposure to many situations. They know how to position the property challenge for offer and acceptance under the pressures of the moment.
In your brokerage, there will be common property challenges that most agents and brokers are experiencing with sellers, tenants, landlords, and buyers. I always see it as valuable and worthwhile for those issues to be shared across the team and for practice or role play sessions to occur. ‘Practice makes perfect’ as they say.
You can never know too much about market situations and conditions.
In this audio program, John Highman, Commercial Real Estate Coach talks about the factors that you need to control in property negotations today.
Are you prepared to move the client forward? You can have something prepared to catch the attention of the client early in the property discussion, negotiation, or listing pitch. If you know plenty of things about your location and the property type, then the strategy really works.
What is it?
You could call this an exercise in ‘verbal flexibility’. As commercial real estate agents and brokers, we need plenty of that as we move our clients toward a goal or conversion. Professionalism underpins the process.
The best agents and brokers are usually great at setting the scene for the client in the conversation and then moving them through the process, challenge, or facts.
In this audio program, John Highman talks about ‘Opening Statements’ and how they should be used by brokers and agents in commercial property brokerage.
When it comes to selling and leasing commercial or retail property today, buyers and tenants like to have some gain as part of the negotiation. Expect that it will happen and have your facts and fall-back position ready. Set the bottom line below which nothing will drop below.
Your job is to reach the best solution for your client through that gain that the buyers and tenants are seeking. Understanding the client’s position and requirements will help you with the negotiation.
Top agents know how to negotiate; they do it all the time. Practicing the process will help you improve if you believe you have weaknesses in knowing what to say and do. In commercial real estate we are usually working with some very experienced clients and business people; they know what to say and do to get a better deal for themselves.
When you strike a hurdle in the deal, no matter what the facts or property type, use a mixture of the following strategies to help you move ahead.
Ask for more information so you can understand the other person’s situation or requirement. This process will also allow you some more time to form some thoughts on what you want to say or do.
If the issue relates to an offer, get it in writing so you can have something to take to the client.
Take notes as the other person talks about their situation or argument. This is another delay process or strategy to give you some time to formulate a response.
Show interest in what they are saying by questioning them deeper on key issues. Questions will always tell you a lot about how to respond to them.
Get them to give you their ‘best offer’ as you may not be able to counter propose. Their best offer may be the only thing that you can work with.
Remain calm no matter what the other party says or does. When you lose your patience you lose your advantage.
Tell them of the client’s preference and the asking price or rent. If you are ‘poles apart’ tell them so and show them some market facts and information that support the client’s position.
Read their body language as they move through the factors that are part of the deal.
Negotiation is not hard, it is just common sense but you can improve your processes by practice and focus. In the commercial property market we have to be ready for some hard deals and tough clients. This property market spins out some very unusual offers and counter proposals.
In this commercial property market, the process of property negotiation is specialised and refined. Top commercial agents build their negotiation skills over time and know how to transact a sale or lease with a reasonable chance of positive result; even in these tougher market conditions.
In this property market, buyers and tenants are in short supply. It is a buyer’s market and a tenants market in most locations. When a good and qualified property enquiry comes your way, it may be the only enquiry that you get for that particular listing; the property owner should be aware that they must not hold out for some high price or rent that the market would not entertain today. Yesterday’s prices and rents are just that; today’s property market is where things are at, and the client should be helped to understand that fact.
If you have a genuine buyer or tenant for the property, then the negotiation with your client has to be factual and supported by relevant market information. Here are some ideas for that:
Current listings that are not sold and remain on market. These listings will frustrate the marketing of your clients listing.
Find out the prices of properties that have sold recently and where they are located. Why did those properties sell? Is your client’s property anything like these other properties that have sold (or rented)?
A summary of improvements in sold properties that make them more marketable today
A list of the improvements and configurations that buyers and tenants are looking for when it comes to buying or renting a new property.
A summation of supply and demand as it applies to commercial and retail property locally.
When it comes to starting any property negotiation it should be assumed that you will qualify the parties to ensure that they are valid and can act in this time of economic pressure. There is no point in wasting time with people that really do not have the ability to transact.
So here are some negotiation tips that you can apply to most property transactions today:
If possible get the parties to meet you in your office or territory. Get them out of their traditional business environment.
Get offers in writing at all times. That also applies to counter offers. Unless the parties are prepared to put something on paper, you have little of substance to work with.
If you strike any hurdles in the discussion moving to an offer, ask questions and move to a deeper level of discussion on any sticking points. In most cases the questioning process will help the other person display their fuller intentions or concerns.
You can back-track in the negotiation to things that are in mutual agreement, so you have a base of agreement to work with.
Seek to fully understand the other party before you open the negotiation. Use market knowledge and facts to move the conversation forward. It is always hard for the other party to refute evidence or established facts from the market.
So how does a ‘top negotiator’ achieve that tag or brand? They close more deals because they practice their craft and know the market. Does that sound like you?
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