Local people are the foundation of a successful real estate business. You can work with the key players of the real estate business locally and most particularly sellers, buyers, and business owners. There are plenty of opportunities in commercial real estate to be sourced in those groups as part of a prospecting model.
In this audio I talk about the importance of a ‘locally focused’ prospecting model and how that can work for you in your real estate business. Drive more listings and commissions your way through a bias towards the local area and the people in it.
Commercial property management remains an important part of the professional property services that brokers and agents offer.
Property managers can offer alternative strategies to improve property performance, net income, and occupancy. Their job is complex, specialized and valuable to investor clients. You can understand why the service is so valuable to a successful brokerage over time.
In commercial real estate today, most of your results (in commissions and listings) will be created through specific involvement with just the top 20% of your clients. Understanding just who are the clients in the top 20% is the important issue to work through. You could say that they are the VIP clients that you should be working with.
The 80/20 concept is called the ‘Pareto Principle’ and it was identified as a general business rule back in the early 1900’s. So what is it? It is a known fact of business and a proven equation when you are looking to covert more results from your efforts. You can use the rule quite comfortably in commercial leasing, sales, and property management.
So we move the concept into commercial real estate for your location and apply it to your business. It doesn’t really matter how many clients you have in your database now, it is the top 20% that you need to identify and then comprehensively service over time. Approximately 80% of your revenue activity will come from that group of elite clients.
In this audio program, John Highman talks about the 80/20 rule and how you can work with it. You can listen to the program or download it below.
The commercial property management segment of the market can be quite lucrative from a brokerage perspective. The clients that you serve in that way require specialized skills and services over an extended period of time. The complexity of the property can involve strategies and activities across the tenancy mix, leasing, vacancy resolve, maintenance management, asset planning, and income performance. There are many things to do and many ways to approach the challenges that the client may face.
So the message here is that you can and should develop a significant property management portfolio in your real estate brokerage. Take the time to develop a list of clients and prospects who will need your services in management at some stage in the future. Develop a prospecting process to open the doors to management opportunity.
The best way to attract commercial real estate clients and those needing management services is to directly prospect the owners of the best buildings in the best locations. It is always preferable to manage a building with multiple tenants in occupancy and multiple levels of income generation.
The bigger buildings and those with a complex tenant mix require expert management help. They also require complex software management programs to administer the required controls on leasing, maintenance, tenant mix, and income optimisation.
So there are some distinct advantages here to be optimised. In this audio recording, John Highman talks about the opportunities of commercial real estate property management in brokerage today. See if you can use some of the tips that John talks about to open up your brokerage opportunities in this way.
Those special and ongoing appointments will only come to you through your direct prospecting efforts and new business focus. Don’t let a day pass without a deliberate and direct focus into new business opportunity.
There is one fact to remember here as you strive to improve your commercial real estate career. Our industry is usually based on local personal contact and individual trust. That is why meetings and appointments are so important.
So what about luck?
Certainly there will be a degree of luck helping you gain some market traction and listing opportunity, but most of the quality new business that you create will come to you through deliberate prospecting and client contact over time. There is really no other consistently good way to grow your real estate business comprehensively and directly.
Make quality choices
So you have some choices to make here. You can move through the industry slowly, or you can take the fast track to grow your leads and client list. If the fast track is for you, then consider the following facts and strategies:
Exactly how can you reach out to new people in an ongoing and relevant way? The message here is that you cannot and should not be average when it comes to your prospecting and client communications.
You will need some local market information and research to support your prospecting activities. In every connection and communication, provide that local market information professionally and specifically to the right people. Vary your market information presentation strategies using graphs, charts, statistics, photographs, and case studies. Allow those specific marketing tools to support your professional skills.
What types of clients and prospects should you focus on? Always bias your prospecting efforts towards quality; the definition of quality would relate to specific buildings, specific clients, particular property precincts, and certain local businesses. Within your client and prospecting list, you should have a select group of VIP people that you will be connecting with more frequently and more directly. Action your contact into that list.
Remember the opportunities evolving from asking the referral question. As part of every client and prospecting meeting, ask for existing and future referrals hence providing links to other people that may have a property interest. Some of your clients and prospects will know a number of other property people from the location. Ask the right questions relating to referrals at the right time in every meeting and in every client relationship.
What are your services? Typically, you can provide specialized brokerage services such as a seller’s agent, a buyer’s agent, a tenancy advocate, or investment specialist. In each case you will need a deliberate marketing approach and focus. You also need specific and supporting market information to help you penetrate the market.
So there are some good things that you can do here to create more appointments locally as a property specialist. Every day should be a special day when it comes to generating new appointments with new people. Start the day with a prospecting approach to new people.
In commercial real estate brokerage I frequently get asked about how new agents can find the right people and clients to serve in their town or city. The question is so common that I just wonder why those salespeople do not know the obvious or take so long to understand it. The industry is similar to many others; diligent focus and work is required at a personal level to find new business, and when that happens, results occur.
The new business is always out there to attract and convert across sales, leasing, and property management. Yes, I know it takes time, but the diligence and actions of ‘top agents’ always shines through when it comes to finding the best clients, properties, and commissions.
It is my firm belief that you cannot be a top agent without some personal plan of prospecting action that you implement every day and refine over time. Regular actions create habits, and habits in our business change listing conversions and commissions.
If you are struggling to find new listings in commercial real estate then you can improve the situation by reviewing and understanding the listings of other agents in your location and your territory. You can use their listings as triggers to improve your listing and new client situation.
Use Other Agents as Listing Leverage
Here are some ways you can do that quickly and effectively:
Other agent’s listings for both sales and leasing – If another agent puts a signboard up on a property in a street, you can use that signboard as a reason to talk to local property owners in the immediate vicinity. Why is that the case, and why is it useful? Firstly it is likely that the other agent has not spoken to those nearby property owners to check out their property situation and interest; secondly any nearby property owner considering a sale or lease of their property, could be interested in competing using you as their agent. You can convert more momentum on your listings based on the marketing of the other properties.
Methods of marketing – Many if not most agents market their listings generically. You can use other agent’s listings as poor examples of marketing. The proof of that fact is usually seen in the time on market.
For sale by owners – There will always be an assortment of commercial real estate listings marketed by owners locally. Their motivation in doing so is usually to save money and avoid commission. The reality of the situation is that they do not have the resources of a good client database or marketing strategy. They cannot comprehensively market their property without a top agent to help. You can pitch your services to those property owners but do not discount your commissions; if they want your services to solve their listing problem then they should pay for it.
Properties in the same street – Review properties by street and location. Slowly move through the street and research the owners that you can talk to. By concentrating on a street by street basis you are delving deeper than most other agents. The property research as this level is time consuming and comprehensive; you will however find people to talk to and that is what the industry is all about. Find the right people and ask questions. In most streets you will find one or two listing opportunities now or in the future.
Poorly marketed properties – When you look at some listings on the internet you will see obvious signs of poor marketing. Usually those properties will be incorrectly photographed, and the advertising copy will be average at best. You can do much better with your property marketing and your listing or sales pitch you show the client how you can do that. Keep a selection and samples of recent listings with you where you can show the client that you really do have a different approach when it comes to property promotion. To be a top agent your marketing efforts should be superior and visually so.
Stale listings – Some properties will stay on the market for a long time. There are reasons for that and those reasons are usually easy to see. When the listing expires with another agent, you can offer a different approach of marketing and method of sale or lease. Base your listing and sales pitch on the tools that bring results.
So you have some good things to do here. Focus your marketing efforts around the weaknesses of other agents. Stand out as the best agent locally.
You can get more tips and ideas for commercial real estate brokerage right here in our bulletin.
In commercial real estate brokerage you need plenty of clients to support your listing and commission activity. You also need new prospects and opportunities to fill the gaps when some of your clients move on or leave the industry.
Given that we are soon to be starting another calendar year, it is time to have a look at a new and fresh approach to prospecting and client networking. This should be a personal priority for all real estate agents and brokers. This is the best time of year to get your client activities and database directions set for the next 12 months.
Here are some facts that relate to the market today and the clients we work with:
The ‘market noise’ from competing agents will always be significant. Many of our top clients will be working with other real estate agencies or at least know of some other top agents locally. This is a continual threat to our market share that can only be addressed by relevant and constant contact with the clients that we know. That is why property specialization is such a critical process in building listing opportunity. When the time comes for the client to move on a property matter they will usually choose the best agent with a dominant market share within the location and the property type. That is why general real estate agents and brokers never really develop dominant levels of business.
Winning a listing today is not entirely about providing discounts or inflating the property price to attract the clients business. Winning a listing is all about packaging the property to attract the maximum interest and facilitate inspections. High prices and higher rentals will not do that. Understand the prevailing market conditions and how you can work with that to solve the property challenge for your clients and prospects. Show the client the true facts of the market as they apply to the property type and location. Tell some stories relating to both successes and failures within the property category.
If you have a property that has been on the market for a long time, it is time to seriously adjust and reduce the price and or the rental structure in line with market conditions. Clients are not fools when it comes to true market conditions; they want results. They will usually understand that an inflated price or rental will make the marketing process quite difficult, so your pitch or presentation needs to tell the right story and provide the right market evidence. Any property with an inflated price or rental will soon become stale on the market; stale listings are usually quoted by top agents as marketing weaknesses. It is easy to show clients how other overpriced listings have been poorly marketed and overlooked by buyers and tenants. If the client is still unrealistic on price or rental expectations, it may be time to walk away from the listing and let some other agency or brokerage waste their time.
Every quality listing should be exclusively marketed. As part of that process, you should be asking for and attracting vendor paid marketing funds. Structure your sales pitch and presentations accordingly. Marketing dollars spent will have a lot to do with your real estate profile locally.
Working within these very simple and yet important facts, it is time to look at the ways you can attract new clients and listing opportunities. As I said earlier, the change in the calendar year is upon us and certainly will give us the opportunity for a new business direction and a freshening of our client connection process.
Here are some tips to help you with reaching out to new clients and prospects:
Visit the people within your current database with the deliberate intention of asking for referral business and opportunities.
Identify the bankers and financiers within your town or city that have an interest in commercial industrial or retail property. Get to know those people at a personal level.
Contact all local accountants and lawyers locally that appear to be reasonably successful with their business activities. They are likely to have many clients active or interested in commercial property.
Identify the entire listings list active with your competitors. Use those listings as leverage to talk to other property owners nearby. Some of those property owners may like to compete with the current listing in the same location.
Identify the people that have purchased investment property within the last 3 to 5 years. They are likely to be active again within the next two or three years. They may wish to buy, sell, lease, or develop.
Check out the property development activity at the local council. Also check out the changes to zoning and property usage. All of these things could be solid foundations for project marketing, future sales and leasing activity.
In our industry there are many leads and opportunities available at any point in time. It is simply a matter of digging deep enough into the marketplace, the people, and the listings. Opportunities in commercial real estate are always available and it is simply a matter of asking the right questions to the right people.
Every so often you will hear some agent or broker say that ‘cold calling doesn’t work’. They are of course giving themselves some reason to not make the calls and avoid the process.
It is a fact that the top agents of the market are not afraid to make lots of calls every day to new people. The important issue here is that they are talking to both new people and current contacts. They are growing relationships on a daily basis.
Our industry is based on relationships. Get to know many property investors, tenants, business owners, and property developers. Keep in contact with them for the long term. Trust is a big issue when it comes to attracting new listings to your agency or brokerage. It can take months if not years for some prospects and clients to be in a position to move on a property matter.
So here are some detailed cold calling tips to help you grow your real estate business:
Determine your market area and targets. The market area is likely to be a part of a town or city and that should be determined by boundaries. Stay within your boundaries and get to know all the properties and property owners inside the zone. The targeted properties are likely to be by type and size. On that basis travel the streets in your sales and leasing territory. Find the quality properties and network the property owners and or landlords.
Call times should be set that work for your business and the people that you should be talking to. Ideally you should be making calls for 2 or 3 hours every day. That will take some discipline in your diary. Don’t let others interfere with your prospecting plans and efforts.
Record your numbers relating to calls out, calls connected, meetings arranged, and listings created. Over time you will see those numbers improve. The improvement can be fast tracked through practice each morning when you first arise.
A conversational approach works better in prospecting. Don’t pitch in any way; you really have no idea of the needs of the other person, so a conversation will get you further into understanding future opportunity.
Get a good database to track your call results. Simplicity and flexibility are important with a database. Protect your data and keep it up to date.
If you want more listing and commission business in commercial real estate brokerage, you will get there a lot faster with a professional approach to cold calling. Understand that most brokers avoid the process, and on that basis it can be a major source of leads and new business for you. Remain confident and make more calls.
In commercial real estate brokerage, it pays to go beyond solutions when it comes to working with clients and prospects. Show them quite clearly that you can provide a specific strategy and process to fast track their commercial or retail property challenge. Give them the process to move ahead.
In giving them the process and the action plan, this will usually be done in some form of listing presentation, sales pitch or property proposal. Whilst ultimately the client may wish to sell or lease their property, you need to show them the exact stages and the strategies in what can be a very complex situation. You can do this through a Gantt chart process.
So a Gantt chart can be placed in your property proposal to show the client the road ahead and your particular recommendations.
A standard lease or sale situation can be broken down into 15 to 20 specific stages. It is simply a matter of listing those stages on a Gantt chart in successive order. You can then apply a time frame to the process.
When the client reviews the proposal or the sales presentation, most of your discussion and recommendations can be formulated around the Gantt chart. You can talk to the process effectively and directly. The client can then see exactly what you are going to do as part of moving the property requirement ahead. Make it easy for the client to see through the complexity of finding a tenant or a buyer as the case may be.
In establishing this process for use within your brokerage, look at the typical sale or lease situation. As an example, I will provide you with a sales pattern.
As a general rule, the listing of a property for sale will involve the following stages:
Property inspection and information gathering
Reviewing the competing properties in the local area
Understanding the history of previous sales
Identifying the concerns of the client
Establishing a target market
Making recommendations to the client regards the property listing process
Creating a marketing campaign for the approval of the client including all of the required advertising layouts, marketing funds, and campaign timing
Seeking the approval of the client to the marketing campaign
Implementing the marketing efforts
Tracking the inbound enquiries from each level of marketing
Directly contacting a short list of qualified buyers within your database
Creating inspections with qualified parties
Short listing buyers for negotiation
Negotiating on the deal
Documenting the contract and getting the required signatures
Satisfaction of the terms and conditions of the contract including due diligence
Moving the property to settlement
So there are plenty of things here to do. Each of these stages will have specific things to focus on. The stages can be formulated into a Gantt chart related to the agency timeframe. The process helps greatly when it comes to converting exclusive listings. It helps the clients see exactly what you are going to do as the broker and how important that will be to achieving a positive outcome. Your property solutions become more real and meaningful for the client and their situation today.
If you would like more tips on commercial real estate brokerage, you can get those in our Newsletter.
Here are some tips that I recorded in MP3 format for my commercial real estate friends. These ideas and comments relate to marketing and branding activities for top agents. You can get some ideas from how you can improve market share.