In commercial real estate brokerage it is important that you segment your client list into groups and opportunities. As part of that, you should identify the VIP clients that you know and those that exist in your local area. They should be the primary targets of your prospecting model in an ongoing way. (NB – you can get our free commercial real estate training right here)
In this audio program, John Highman talks about the strategies behind VIP database management and the professional skills of commercial real estate sales and leasing today.
Learn how to improve your real estate business and grow the opportunities with the right clients in the right way.
In commercial real estate brokerage today develop a personal focus on performance relative to your location and property specialities. When you focus in this way, you can develop some real momentum and levels of outcome in both listings and commissions.
The agents the struggle in the industry are those that generally do not know where they are currently when it comes to industry based performance. That is a problem but it can be easily fixed.
Top Agent Focus
The top agents of the market understand exactly how they have performed over recent time when it comes to:
Listing Activities within their specialized property type – you cannot be a specialist across every property type and location so determine the things that you can get some results and listings from in the local area.
Commissions per listing – when you drill down into the commissions per listing you will soon see levels of quality that can be improved on a listing by listing basis. Good quality listings will always move faster and the time on market will be shorter.
Commissions per transaction – you can split your transactions into sales and leasing activity. You will then see the levels of activity created from each transaction and then you can assess the size of the transaction taking into account the amount of effort required in the marketing and the negotiating. Selective listing activities will help you improve commissions per transaction.
Listings per location – assess your current listings on a precinct and locational basis. Do you have a good sure of listings in the prime precincts and areas where people are making most of the property enquiry? You may need to adjust your property prospecting activities to convert more listings per location. The best locations will always create better levels of enquiry and that has a direct flow through into levels of inspection, frequency of negotiation, and database size.
Commissions relative to database size and activity – review your current database for both size and relevance. Also consider the accuracy of the information contained within the database. If you are struggling in the market today when it comes to new business opportunities, then it is time to look at your client list and your prospecting activities. The database will be at the centre of that assessment and review process.
Referral business opportunity – from your recent successful transactions the referral question should have been asked and encouraged. It is reasonably easy to reach out into new market segments and property opportunity through a deliberate and direct referral strategy. Your VIP clients should be at the centre of your referral business and referral questions.
VIP clients – understand exactly who your VIP clients are today and why you should consider them for future business opportunity. Segment those VIP clients into levels of activity, location, financial capability, and timing. You should be connecting with the VIP clients more frequently and directly as part of your prospecting model.
Competing agents and brokers locally – an assessment of competing agents locally will help you re-position yourself into the market segments that are underserviced or offer the best opportunity. As part of your professional business plan is a commercial real estate agent or broker, make some deliberate choices when it comes to personal marketing processes and strategies in and around your competing agents.
Be a Problem Solver – make it easy to your clients and prospects to see that you are the agent of choice when it comes to solving a property problem in a timely and direct way. When you have a successful transaction, be that in sales or leasing, spread the word about your success and the results achieved for your clients. Get some success letters into the location with a particular focus on property investors and local business owners.
From the list mentioned, it is easy to see that commercial real estate brokerage business is all about assessing the numbers and developing appropriate levels of personal improvement.
If you’re going to get anywhere in commercial real estate brokerage you need a comprehensive database that covers the marketplace for you. In simple terms, you need a healthy database that is up to date and growing in a regular and ongoing way.
It is very hard to establish a career in commercial real estate today without a reasonable database to support ongoing contact and listing opportunities. The people that you know today are the sources of future opportunity if you work them correctly and directly; the need to be nurtured and shaped into the next sales, leasing, or property management appointment. Strategy and effort will help those outcomes.
Assess What Clients and Systems You Have Now
Look at your database activities as they exist today and decide how you can improve the depth of the data and the quality of the clients in the list. Understand where the next opportunities are within that list. Start talking to the right people in an ongoing way.
Here are some specific rules to help you establish a healthy database in your commercial real estate business as a broker or an agent:
Segmentation – split the database into zones, price ranges, customer types, and property types. In that way you can successfully use the search facility to put together people and opportunities. Make it easy to find the right people when you need them or when you have the right property to market.
Up to date information – the data that you put into your list today is to be shaped and maintained over time. That information will change as will the property requirements of the clients and prospects that you know. Establish a contact program that allows you to maintain relevant and real information relating to each person and their current property situation. Look for pressures and the changes that they could be experiencing.
Location based – in most towns and cities, property requirements will be centralized into particular streets and property types. On that basis you should focus your prospecting activities into a defined and active geographical zone. Assess your territory for the pockets of priority and property change. Look for the next levels of activity that you can tap into within the location.
VIP Clients – some clients are better than others. Understand what a client should be for you and rank your clients on the basis of price sensitivity, timing, and location. When you find the right listing, you can make the direct contact in a relevant and real way.
Email and Document integration – a good database will integrate into e-mail messaging, and document storage. Every communication and every document involving each and every client should be suitably stored and referred to through the database. Ideally, you want to access previous communications, messages, and documents easily and effectively.
Marketing integration – when you get an enquiry for a particular type of property or perhaps a listing, that enquiry should be entered into your database. The subsequent dispatch of marketing information should occur from the database. Every brochure, listing, campaign, and method of sale or lease should be accommodated and managed through the database software program.
Remove redundancies – don’t let redundant information destabilize your database. Every person and entry in your client list needs to be maintained for accuracy and relevance. Remove the redundant information in a continual and ongoing way. Enter new information daily from every meeting, conversation, listing enquiry, inspection, and negotiation.
New information – given that you should be focusing all of your client contact and prospecting into a particular zone of your town or city, there will be new parcels of information that you can capture every day regards business owners, investors, developers, and owner occupiers. Carefully consider the categories, the segments, and the contact processes within the database that can then allow you to effectively capture the new information as you receive it.
If you are serious about commercial real estate brokerage, then you will be needing a database to support your activities in a regular and ongoing way.
Property Investors get involved with commercial property for a number of reasons. Their motivations can be quite personal and specific to factors such as capital gain, redevelopment, highest and best use, building renovation, market rental, and portfolio mix.
In asking the right questions you can identify exactly what your clients and your Property Investors are looking for. From that point onwards it is simply a matter of understanding capabilities of finance and the correct time for a transaction; those observations will apply individually with your clients and prospects.
Here are some ideas to help you understand exactly what your clients are looking for relative to commercial and retail real estate investment:
Determine the property type that suits the balance of the portfolio. It is a well-known fact that portfolio diversity will lessen the risk and volatility of an investment portfolio. In a lessening the risk, the returns can also be reduced. That is where many Property Investors will divide their portfolio across retail, industrial, and office buildings.
Understand the factors of timing with any property acquisition or change. Locally you will find the pressures of property supply and demand impacting prices, rents, and time on market. There will be times of the year which are more favourable for the sales verses leasing activity.
Some properties have a definite lead up to a promotion or marketing campaign. Some things may need to be fixed and addressed. As an example, you may have to rectify weaknesses in the tenancy mix, vacancy factors, tenant selection, building cash flow, and rental structures. Look for those weaknesses before you implement a marketing campaign for the client.
Some of your clients will have a preference for portfolio improvement through diversity and change. They will be on the lookout for properties in particular locations, assets of particular value, and buildings that may offer a new and vibrant opportunity through redevelopment or a fresh alignment to the market rental locally. When you understand the needs of the particular client, it is quite possible to put together a transaction off market without the pressured factors and interference occurring with other agents, buyers, or tenants.
Within your database, determine a small segment of clients and prospects that you would regard as VIPs. Over time get to know exactly what these people are looking for from an investment perspective and identify when they could potentially need that repositioning or change. From that point onwards you can be researching the market and looking for the correct property acquisitions and opportunities.
When you focus a lot more on your individual VIP clients and their property needs you can get to the real triggers and points of change that create commissions. That then is a proactive approach to being a top commercial real estate agent.
In commercial real estate today, every agent should have an ongoing ‘client loyalty’ program to help with growing market share. In this way you can stand out as a relevant and top quality agent. It is then difficult for the client to overlook your presence and availability when it comes to taking a property to the market for sale or lease.
So what can you do to structure a ‘client loyalty’ program? Here are some ideas:
In the first instance you should give it a name. Without a name the client does not know or feel that they are any different to others in the local area that you may be working with. In the absence of anything else to use, you can call your program the ‘VIP Client Connect’. Tell the client that they are part of this ‘exclusive’ group. Show them what will be happening and why that will be of benefit to them.
On what basis will you be selecting ‘VIP’ members for the group? Will the criteria be based on property location, size, value, portfolio type, or frequency of business?
The program should be about the client and on that basis they should get something out of it. There is no point in structuring a program if you are going to do nothing with it. What can you do for them as part of their membership in your group of ‘VIP’ clients? How will they know that they are ‘special’ and that you are doing extra things for them?
Focus on ‘loyalty’ with these clients and not ‘discounts’. Professionalism should be the backbone of the program; discounts have no place in a commercial real estate client relationship if professionalism is your goal. Ensure that you are sending a message of high quality and comprehensive services in sales, leasing, and property management.
Provide market updates that are comprehensive and regular. They can be sent directly to the client with links to supporting resources and research on your website.
Your database should segment these ‘VIP’ members from the others that you work with. The database should also have the ability to capture the details of ongoing contact.
Establish a special newsletter for the process of ‘VIP’ contact. Brand that newsletter uniquely and personalise the text with specially selected properties.
Set up monthly or quarterly industry briefings that can be held in your office for selected clients. Invite other industry professionals (solicitors, accountants, and planners) to complement your presentation.
Provide a private access part of your website so the ‘VIP members’ can get to regular industry updates.
Make it easy for these special people to make contact with you 7 days per week. Give them the mobile cell phone numbers to use in the event of questions or concerns.
You can do more with this list based on your property speciality and your location. Make your clients and prospect feel special in your business. The rewards will be many.