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.
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.
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?
Want more free tips for commercial real estate agents? You can get them in our Newsletter on this site.
When it comes to selling and leasing commercial property, the direct marketing approach has distinct advantages. That being said, the direct marketing approach does have more requirements of time and effort on the part of the commercial agent.
Every property that is listed for sale or for lease should be exposed to a variety of marketing campaigns and initiatives using the following categories as a guideline:
The local property business proprietors that may need to relocate will always be opportunity. Keep in close contact with this business segment.
Property investors requiring alternative properties with a different tenancy mix and cash flows will always seize opportunity where they can afford it.
Identify the property investors that seek to diversify their portfolio in different locations and in different property types. Even in difficult times, these investors had do exist and are waiting for the right circumstances or bargains come along.
Contact all the local tenants that may seek to relocate through expansion, contraction, rental, or property acquisition.
Businesses located in the immediate proximity of the actual listing may be requiring further premises close to their existing operations.
Within your database you will have people who were previously qualified from other earlier campaigns and listings. They should be contacted again.
All of your current property listings should be cross promoted to the suitable qualified prospects that you take to inspections.
So these categories are all direct marketing tools. They require specific effort and a systemized process on the part of the agent. When the property market slows or becomes tougher, these issues above become more important than ever before. They can be used in addition to any ordinary generic marketing that you usually implement. That being said, you should only do these things based on the quality of the listing, the quality of the client, and an exclusive listing.