Onward

Submitted by Brad on April 16, 2011 - 8:32 am

I just finished reading Onward – How Starbucks Fought for Its Life without Losing Its Soulby Howard Schultz, CEO of Starbucks. This is a first person account of the challenges that Starbucks faced from 2007 – 2010 and how the company emerged as a better company after the recession than  before the recession. It was an excellent read.

As with all non-fiction books I read, I am always looking for how to apply the ideas to commercial real estate brokerage. Here are just a few of the thoughts and ideas that I found most relevant to CRE brokerage.

 

  • Passion Is Critical – A resounding theme throughout the book is how passionate Howard Schultz is about coffee. He is clearly devoted to his product and I would highly doubt that he could be nearly as successful if he did not love both his product and company as much as he does. As I reflect on all the great brokers I have known throughout the years, passion for real estate and passion for their clients is clearly evident.
  • Stick to Your Values- Starbucks stands for a certain set of values. Encouraging a sense of community, being fair to their suppliers, being loyal and dedicated to the company’s employees are all a part of Starbucks’ values. One of the greatest challenges of being a commercial real estate broker is the fact that your product (the property and owner that you represent) is always changing. As a result, there will be times that you will encounter individuals that will be contrary to your values. You will also encounter situations that may encourage you to forgo your values. Howard Schultz refused to sacrifice his company’s values even in the darkest of times. Know your values and stick to them.
  • Reinvent, but Keep to Your Core Competency- During this tumultuous period in Starbucks corporate history, the company had to reinvent itself. It came out with Pike’s Place Roast –  a blend of coffee that would be available every day in every store. They developed a loyalty program. They developed the VIA instant coffee brand. They launched into social media and became one of the most followed brands on Facebook and Twitter. Brokers need to always be reinventing, while at the same time staying focused on their core competency. One of the most successful brokers I know during the past 3 years was a broker who despite focusing on large shopping center transactions recognized that due to a lack of financing and the difficultly of establishing market rents, the market would be dramatically diminished for this type of product. As a result, he switched to sourcing and marketing single tenant retail deals and has had significant success while so many others have struggled.
  • Take Chances- Instead of just trying to do the same thing that got Starbucks to 16,000 locations, Schultz turned the ship upside down and took significant chances. Some of which succeeded and some of which failed. There was substantial resistance to going into the “instant coffee” business, but Schultz took the chance and now VIA is a $1B business. CRE brokers need to take chances to stand out from the crowd. Making the cold call that you may fear, being creative with marketing, holding an event when you don’t know who will attend, taking a listing that may not sell, are all examples of chances that CRE brokers take to grow their business.  
  • Control What You Can Control – So much of what Starbucks faced over the past few years was driven by the economy, but despite this fact, Starbucks did not just sit back and blame the economy for its troubles. Instead the company focused on addressing those items that it could control (i.e. customer service, product development, cost control). No matter how challenging the market, there is so much that CRE brokers can control (i.e. calling prospects, knowing your market, maintaining integrity).
  • Make Tough Decisions – Unlike other CEO slashers, you can tell that Starbucks’ decision to close over 600 locations and layoff thousands of employees was truly painful for Schultz. But he knew for the long term good of the company, this was necessary. Sometimes CRE brokers need to make difficult decisions to further their business. Letting a client go because they are either too difficult to work with or their property is just no longer profitable for you, can be challenging. Severing an employee or broker-partner because the relationship is no longer working is necessary to move your business forward. Too many people keep bad employees too long or stay in a broker-partner relationship much longer than they should because they don’t want to make the tough decision to move on.
  • Treat Others Fairly – Unlike many other companies who focus on beating up their suppliers, Starbucks seems to take great pride in treating the farmers that supply their coffee fairly. They actually have set up “farmer support centers” so they can teach their suppliers how to produce the highest quality coffee bean at the lowest cost so that the farmer can make more money when they sell their high quality bean to Starbucks. Successful CRE brokers treat co-brokers fairly. They return appraiser’s phone calls because they realize that appraisers are an important component of the business. They treat everyone with respect.
  • Communicate Openly – Schultz learned the hard way (a leaked memo) that in today’s world of email, web sites, and social media, there are no secrets. Starbucks prides itself on openly communicating with its partners, its customers, its suppliers, financial analysts, and shareholders. CRE brokers recognize the importance of communicating with all parties in a transaction, but especially their clients. Hiding from your clients is a recipe for failure. Your clients will assume that no news is bad news. They will assume that no news means that you may not even care about them or the assignment.

I must confess. I don’t drink coffee. I don’t like the taste. I am a big Starbucks fan (Venti Iced Green Tea, No Sweetener). I have even make some sizeable commissions leasing space to Starbucks and selling buildings occupied by Starbucks. If you are a Starbucks fan or simply a fan of understanding the inner workings of a company that has become such a part of so many of our lives, I encourage you to read the book and even give it to a few of your favorite clients.

6 Tips for Turning Sign Calls into Sales?

Submitted by Brad on April 4, 2011 - 8:23 pm

The phone rings, the broker answers and the person on the other end says, “I am calling about the space on Main Street, how much is it?”

The broker answers and says, “$15/SF, NNN”. The person hangs up. End of conversation – if you call this a conversation.

Although fielding sign calls is just one part of the marketing process, a property owner did not hire you to just provide facts. They hired you to “sell” their property. Sometimes a broker forgets that their job is to sell their product. The following are a few tips that will help you better respond to sign calls:

  • Take Control of the Conversation – Frequently the person calling does not know what else to ask, so they start off with asking about the price. I recommend that you immediately take control of the conversation by asking a question back to the caller, such as, “What type of business do you operate?”, or “What size space do you think you need for your business?”. You can then start asking additional questions such as, “What is it about this property or this location that caused you to inquire?” Once you start asking questions, you will have a much better sense of their needs and then better be able to match their needs to your property’s qualities.
  • Know The Attributes of Your Property- If you are leasing an office building, you need to know the amenities of the property and the area compared to your competitor’s property. How close is it to public transportation? How much is parking in your property vs. the others? If you are leasing a retail center, you need to know as much information about the property as possible. What type of uses are missing from the area? Which businesses at your shopping center are most successful. What causes people to come to the property? Too often, we just quote square footage and rate without actually trying to convince someone why the property we are marketing would be good for them. Either we don’t know the attributes of our property or we just assume that everyone else knows the property’s benefits. Don’t assume.
  • Obtain Contact Information- Ask for an individuals’ full name, phone number, business name, and email address. Otherwise, once they hang up they could be gone forever. Yes, there are times when this is a good thing, but in general you want to be able to send them some follow up information.
  • Qualify the Inquiry – Sometimes it is very evident that the party calling is just kicking tires, but you won’t know unless you ask questions. If someone is looking to relocate their business and they say that they are just looking for cheaper rent, ask them how much they are paying. If there is no way you could ever achieve that same rent, just tell them that and you can save yourself a lot of time. At the same time, if you know that your site has better amenities than their existing location, you can then ask whether they would pay a higher rent for a better building.
  • Follow Up – Follow up with people who inquire about your property. Assuming that you could tell from your phone conversation that this person was likely to open or expand or relocate their business in the near future, you should continue to follow up with this individual via phone and/or email until you know what they decided to do. Don’t worry about the fact that they may not call you back even after a few inquiries. How many times have you inquired about something only to not actually take action for many more months into the future.
  • Communicate with Your Client – Make sure your client knows what type of  inquiries you are getting. This is vital information for an owner. How many calls? What type of businesses? What are their main objections? Is there anything the owner can do to help you improve the quality of your responses? 

The above suggestions apply regardless of product type. They also apply to investment sale transactions or leasing. The concepts are the same, the question and answers you give the inquiring party differ. Your clients are looking for you to “sell” their property.

Value Added Brokers know that a property inquiry is worth a dozen cold calls (maybe 2 dozen) and they make the most of each inquiry.  

My Favorite Economic Concept – Opportunity Cost!

Submitted by Brad on March 16, 2011 - 8:46 am

I studied economics in college. As I look back on my economic classes from 20 years ago, I would have to say that the “Most Valuable Economic Concept Award” goes to “Opportunity Cost”.

Opportunity Cost is the cost you incur when you deploy your resources in one direction compared to another. I took the attached photo this past week while I was driving by Costco. Although it may be difficult to see from this photo, the line for gas backed up into the streets. Anyone getting on the end of this line was probably looking at a minimum of 20 minutes before they could fill their car up with gas. Assuming that they could save $.20 a gallon for 20 gallons of gas, they would save $4.00. The people on this line have determined that there is nothing else that they could be doing that would be worth more than $12/hour. This may apply to them and they did not even realize that they were making this economic calculation when they decided to get in line.   

So how does this apply to commercial real estate brokers.

  • When you drive around on a Tuesday afternoon to look at property, you may be foregoing this time to be on the phones talking to clients.
  • When you take a listing that you think has a low probability of success, you are foregoing either giving more effort to your listings with a higher probability of success; or seeking new listings that have a higher probability of success.
  • When you represent a buyer that takes up a lot of your time, you are foregoing the opportunity to service your other clients.
  • When you drive across town to deliver an item that could just as easily have been sent via overnight mail, you are costing yourself time in the office working on other projects or the time you could be spending at home with your family.   

Understanding Opportunity Cost is also important when dealing with your clients.

  • Let’s assume that your client has $2M in the bank that they are waiting to invest. Many investors are holding onto this money because they believe that if they invest this money today, there will be a better opportunity in the future. There is an Opportunity Cost to deploying this capital today, because it may take away an opportunity in the future. So as a result, they are willing to settle for 1% or less in the bank today so that they can potentially earn a much greater return in the future.
  • At the same time, you may be able to demonstrate to someone that if they sit on their money at 1% for the next 3 years when they could have purchased a property today at a 10% cash on cash return, there Opportunity Cost is 9%/year. As a result, if they wait 3 years for an opportunity that may earn them 12%/year, it may very well work out that they should have invested their money today.

I think about Opportunity Cost every day (remember, I was an economics major and I love this concept). The most challenging thing about this concept is how do you value the items that can’t be valued. When you take to you spend all Saturday with your child at their sporting event, there is a cost to this action. There is also a benefit that you just can’t quantify.  No one said economics was easy!

Think about the Opportunity Cost of your actions and you will become a much more productive individual. You will also improve your decision making skills.

Value Added Brokers understand the concept of Opportunity Cost and apply it throughout all aspects of their lives.  

Litigation Mitigation – Part II

Submitted by Brad on February 23, 2011 - 9:56 am

This is the second part of a 2 blog series addressing the issue of how to avoid the terribly stressful, expensive, reputation damaging, and time consuming process of becoming involved in legal issues relative to commercial real estate brokerage. Please see my Feb 9, 2011 blog for “Litigation Mitigation – Part I”.

ONCE AGAIN, PLEASE NOTE THAT I AM NOT AN ATTORNEY AND NOTHING CONTAINED IN THIS BLOG IS MEANT TO PROVIDE LEGAL ADVICE. FURTHERMORE, THE LAWS ARE DIFFERENT IN ALL PARTS OF THE WORLD. YOU ARE HIGHLY ENCOURAGED TO SEEK THE ADVICE OF AN ATTORNEY FOR ALL REAL ESTATE MATTERS WHICH WOULD TYPICALLY BE OUTSIDE OF ROLE OF A REAL ESTATE BROKER/AGENT.

The following are my additional recommendations for “Litigation Mitigation”: 

  • Always Encourage a Buyer/Tenant to Perform Their Own Investigation: Although your desire is to provide your client with great customer service, doing their investigation for them without making sure you have encouraged them to confirm or investigate the matter themselves is a recipe for trouble. It would be easy for me to say that you should just tell your client that you can’t help them with any investigation, but we know that this is not entirely realistic if you are trying to move a deal forward. As a result, when you do investigate something for your client, make sure you tell them what you found out, who you spoke with, give a copy of anything you received in writing, and then tell them in writing that they should confirm everything that you have learned and that it is their responsibility to make sure that what you learned is correct. Avoid making authoritative statements, such as “I checked with the City and your use is definitely allowed at this location.”
  • Use Forms:  Most brokerage firms have approved lease and purchase agreement forms or they utilize forms from a real estate association that is familiar with the region where you perform your brokerage activities, as well the type of real estate that you lease or sell (i.e. industrial vs. retail vs. office). Use these forms. They are frequently created by organizations that are trying to not only protect the principals in the transaction, but they are usually designed to protect the broker. When using these forms, don’t do so blindly. When you prepare the document, make sure the form reflects the deal. Ask for help if you don’t know how to adjust the form to match your deal. This is where your broker or other agents can help, although if it is clearly a legal matter, you need to get an attorney involved.     
  • Avoid Giving Tax, Legal, Construction or Similar Advice: Many brokers have a background in another discipline besides brokerage. Even if you have expertise in a certain area (i.e. you are a licensed general contractor or a CPA), you still need to be very careful in how you advise people since in the brokerage transaction, you are not acting in the capacity of your other expertise. You are acting in a brokerage capacity. Although your experience may allow you to share knowledge, a broker should always make sure that they are not providing advice that a broker would not normally provide. Always indicate that you are not an expert in certain matters. Although your offering memorandum, the letter of intent, the lease agreement or the purchase agreement may advise a client to get expert advice, you could open your self up to a world of hurt if despite these disclaimers, you act like you are the expert. Don’t rely on small print to protect you.
  • Trust Your Gut: I say this with a little bit of caution. Some people have ethical issues and therefore what their gut says is right may very well be wrong. For the rest of us who try to lead ethical lives, your gut will usually tell you when their is a problem. Brokerage is filled with ethical dilemmas and fine lines. If something does not feel right, ask for advice. One of the great challenges with brokerage is the dollars at the end of the rainbow. These dollars can frequently skew some one’s ethical thinking. Don’t let this happen to you. 
  • Tell the Truth: One of my favorite expressions is, “You never have to remember what you said, if you always tell the truth.” Life just becomes a lot easier when you just tell the truth in all situations. I don’t know of many legal situations that have come from a broker telling the truth. It is usually when a broker lies, misrepresents, or conceals information, when they encounter grief.
  • Don’t Be a Jerk: I read about a study recently (I am sorry, but I just don’t remember where I read it) that talked about how doctors who had poor bedside manner had a much higher probability of getting sued by their patients. The conclusion to the study was that people have a lower likelihood of suing someone that they like. Real estate litigation usually has numerous forks in the road where the parties have an opportunity to try and solve the problem. A broker who helps to solve the problem instead of throwing fuel on the flames increases the probability of avoiding litigation.

Although much of what I have stated in these 2 blogs about avoiding litigation is common sense, there is a perception by many people entering the business that one of the ways to succeed in commercial real estate brokerage is to be sly and at times deceitful. Although there are some who make their living this way, I am here to say that this is just not the way you need to live your life.

Value Added Brokers are professionals who think long term. They recognize the cost of litigation both in terms of dollars, but also the impact it can have on their reputation and careers.

Litigation Mitigation – Part I

Submitted by Brad on February 9, 2011 - 8:09 am

The real estate business has the potential to be a highly litigious business. In my opinion, this is primarily because the overall dollars involved in real estate are relatively quite large compared to just about any other purchase, and the barriers to entry to be in the real estate business are incredibly low. I have always been shocked that in many places, there is more mandatory training involved in becoming a hair dresser than in becoming a real estate agent. Furthermore, commercial real estate is so different from residential, I have always been a believer that there should be a separate license for commercial real estate agents.

No one in the commercial real estate brokerage business wants to be involved in litigation. All it will do is cost you money, a lot of time (which is money to someone in the brokerage business), and many nights of lost sleep. The following are some tips & ideas for what I call “Litigation Mitigation”.

PLEASE NOTE THAT I AM NOT AN ATTORNEY AND NOTHING CONTAINED IN THIS BLOG IS MEANT TO PROVIDE LEGAL ADVICE. FURTHERMORE, THE LAWS ARE DIFFERENT IN ALL PARTS OF THE WORLD. YOU ARE HIGHLY ENCOURAGED TO SEEK THE ADVICE OF AN ATTORNEY FOR ALL REAL ESTATE MATTERS WHICH WOULD TYPICALLY BE OUTSIDE OF ROLE OF A REAL ESTATE BROKER/AGENT.  

  • Get Information in Writing – Whether the information is coming from a seller, a buyer, a tenant, a municipal official, a contractor or anyone else involved in the real estate transaction; get the  information that you are being asked to convey in writing. 
  • Qualify Your Statements – Terms such as “approximately” and “estimated” are valuable terms, especially if you are putting information in writing. Making exact statements without qualification can certainly be a recipe for trouble.
  • Use Disclaimers – Although the use of disclaimers will not totally absolve you of future claims, in general, they are more beneficial than not. It is important to have language in your marketing package and agreements that state that you are not representing all information in your materials to be correct and to encourage tenants and buyers to perform their own investigation and consult professional advice.
  • Do Not Assume Anything – The world is just becoming more complicated every day, especially as it relates to zoning. I don’t know what it is like in other parts of the world, but in California the real estate world just seems to keep getting more convoluted. Cities have so many layers of zoning (special districts, overlay districts, and so on) that it is really important for buyers and tenants to visit municipalities and make inquiries to make sure they understand what uses are allowed at a property and what changes may be required to accommodate various uses. 
  • How Would Your Action Look in Front of a Jury – It is important to consider how your action would look in front of a jury. For example, our agents are instructed to never let a tenant sign a binding lease upon initial review. We insist that the document either be emailed to them in advance or that it be delivered to them and that the tenant at least has an evening to review the lease. I don’t want my agents to be sitting in a court room with an attorney asking the question, “so you presented the 50 page lease document to them for the 1st time at 1 Pm in the afternoon and you had them sign it while sitting with you and they did not have time to review the document.” I don’t think this would look to good in front of a jury.

More “Litigation Mitigation” Tips Next Week

Value Added Brokers Want to Avoid Litigation and Take the Appropriate Steps to Protect Themselves

Who Turned the Lights On?

Submitted by Brad on February 3, 2011 - 8:57 am

Who Turned the Lights On? Did you turn the lights on this morning at your office? Did you turn them off last night? When I worked at Sperry Van Ness and we had our awards presentation each year, one of the common ingrediants amongst the top producers was the fact that top producers are the people that turn the lights on in the morning and turned them off at the end of the day.  

January is over. It was obvious that everyone started this year off with a lot of enthusiasm based upon the fact that it was difficult to get certain internet portals to function properly during the first few weeks of the year. Costar was running slower, gotomypc.com was also slow, as were other sites. I received cold calls from numerous vendors trying to source business from my office. Now that the January “rush” is over, how are you going to keep yourself motivated?

Here are 6 ideas to help keep the January excitment flowing through the year:

  1. Review Your Written Goals: At least once a week, review your written goals. It will help remind you what you set out to achieve.
  2. What is Your Why?: In addition to goals, you need to know why you are trying to achieve your goals. I have written down about 20 “whys” that I review when I review my goals. These include short term reasons like simply continuing to drive a nice car to long term reasons like putting my three children through college without them having to incur any debt.
  3. Surround Yourself with the Right People: One of the benefits of a real estate brokerage company isn’t to just provide you with a place to go to work, but rather a brokerage company should provide you with a motivating atmosphere. Although your office may have some “rah rah” to it, I am really just referring to being surrounded by people who also work hard and encourage your success. The best brokerage offices want everyone to succeed. They believe that there is an abundant amount of business for all to capture (which is true).
  4. Measure Your Results:  Pay attention to the metrics of our business. How many listings do you have? How much potential revenue can these listings create? How many business development meetings are you having each month? How is your revenue in comparison to previous years? How many cold/warm calls did you make this week?
  5. Take Small Breaks:  You don’t need a long vacation to recharge. Although it is important to try and take vacation time, especially if you have a family, for most people vacations are not relaxing. There is a lot of stress building up to the vacation because you are trying to get a lot done before you leave, then there is the stress of traveling (especially if you live in the midwest/east coast this year), then there is the recovery from being out of the office. I have become a big fan of smaller breaks. Lunch with friends; an afternoon on the golf course, a day or two for skiing, a few  hours of sitting on the couch and watching football, a morning where you sleep in, and so on. These small breaks may do more to recharge your batteries than a week of being any where.
  6. Read & Listen:  Read books & magazines or listen to CD’s. My two favorite sources of motivation are Success magazine which for $29.95/year sends you not only a great magazine each month, but also includes a CD. I probably listen to the Success magazine CD a minimum of 3 times after I receive it. My other favorite is JB Glossinger who puts out a podcast 5 days a week, 52 weeks a year. I listen to this podcast as I exercise at the gym.

Value Added Brokers are motivated people and seek to be a motivating force in other people’s lives.

  

Do You Practice Probability Brokerage?

Submitted by Brad on January 21, 2011 - 5:47 am

Which is a better listing?

A) A 15M  building for sale or  B) a $5M  building for sale?

On the surface it would seem that the answer is clearly A. Probabilty brokerage is about looking deeper and doing a quick calculation to really understand each of these listings.

Let’s make the following assumptions:

15M Office Building 

  • The $15M building is institutionally owned;
  • The owner has asked 5 brokerage companies to compete and they will only pay a 1% fee to your firm and a 1% fee to a co-broker, if there is one;
  • The building is 100% occupied, but a tenant occupying 30% of the building has a lease coming due in 18 months;
  • The building is in a trade area with 15% vacancy and the market has not been improving.
  • Based upon these factors, you think that you and the broker that brought you in on the deal have a 50% probability of selling the deal during the next 12 months.  

Let’s do the math: $15M x 1% = $150,000. $75,000 would go to you and $75,000 to your partner, but there is only a 50% probability of collecting this fee so your “probability fee” is equal to $37,500.

 $5M Building

  • The $5M building is owned by a private individual that has substantial motivation to sell;
  • You have been calling on this owner for 3 years and because they know you are the expert in the market you did not compete for the listing. The owner will pay a 4% fee regardless of whether you co-broker the deal or there is a co-operating broker.  
  • The building is 85% occupied by a diverse group of tenants with leases at market;
  • The building is in a popular trade area for investors.
  • Based upon these factors, you think that you have an 80% probability of closing this deal in the next 12 months.
  • Let’s do the math on this deal: $5M x 4% = $200,000. There is no partner so you don’t need to split it. Although let’s assume that there is a 50% probability that you will co-broker the deal.  So the list side is $100K and the co-broker side is $100K. If there is a 50% probabilty of co-brokering the deal then you multiply the co-broker fee by 50% and you get $50K. Therefore, probability says that you can expect to receive $150,000 from this deal upon a sale. If there is an 80% probability of receiving this fee, then you multiple $150,000 x 80%  which equals $120,000. 

    $120,000 is a lot better fee than $37,500.   

    Now there are other factors that you must always consider. For example, if you are successful at selling the property for the institutional seller, there could be a lot more business down the road. Or maybe the broker that brought you in on the $15M deal is someone who you really want to work with. There could also be some glory from the $15M deal because maybe it would be the largest deal sold in your market. 

    The purpose of this exercise is to make sure you are not fooling yourself into believing that the $15M deal is a much better deal for you just because it is $15m. 

    This exact same exercise can be applied to leasing. In leasing it is more complicated because each property has so many spaces and because the leasing of the property is usually spread out over a much greater period of time. If your business plan involves leasing in addition to sales, I encourage you to apply a similar model to leasing. My experience has been that when brokers apply the “probability brokerage formula” to leasing they frequently realize that they do not have enough quality product listed to achieve their goals.   

    Value Added Brokers know that time and knowledge are their primary resources and they use “the probabilty brokerage formula” to maximize the use of these precious commodities.

    What a DirecTV Technician Can Teach You About Being a CRE Broker

    Submitted by Brad on January 13, 2011 - 6:26 am

    This past week my family entered the 21st century and we now have HD TV (I love watching football in HD). Frank, the DirecTV technician, who installed the new satellite dish and receiver was outstanding. During the course of the 3 hour installation, he was polite, courteous, and extremely intent on making sure that everything was done correctly, especially because we kept running into problems with the installation.

    As he was getting ready to pack up, I complimented him on his service and also indicated that I could feel his frustration each time we encountered a problem. He looked at me, and said, “I give people TV. That’s what I do for a living. I give people TV and I want to make sure it works right.” Wow!!!!

    What do you do for a living? Do you “broker commercial real estate”, or do you:

    • “Help investors buy and sell real estate so they can fulfill their family’s goals”;
    • “Represent tenants so they can have the best real estate at the best value so they can further their entrepreneurial dreams”;
    • “Represent institutional quality owners of real estate so they can maximize the value of their company’s portfolio.”

    I think you get the idea. Stop and think about what you really do for a living and how through your efforts you are adding value to other people’s lives. When you wake up each morning and go to the office, are you going there just to make money or do you have a bigger picture in mind.

    One thing I know for sure is that it is much easier for Frank to go to work each day, including just about every weekend, when he knows that in his head, “he gives people TV”.

    Value Added Brokers have a bigger vision for themselves  – what’s your vision?

    5 Actions to List More Commercial Real Estate in 2011

    Submitted by Brad on January 2, 2011 - 9:00 pm

    The slate is clean. The race is on. It is the beginning of the year and everyone has the same starting line. What actions will you take to make sure you list more property in 2011.

    Take these 5 actions and you will increase the probability of listing more properties in 2011.

    1. Improve Your Listing Presentation: The key to a good listing presentation is to know your story so well that telling it just comes naturally. A listing presentation is about demonstrating that you understand the subject property, explaining how you will market the property,  conveying your expertise, and convincing someone why they should hire you versus your competition. Most importantly, a good listing presentation involves developing strong rapport with your client. We have all had stories read to us and we know that there are good story tellers and there are great story tellers. Work on telling your story and you will list more properties. 
    2. Focus Your Efforts: Sellers want to list property with market experts. The more you focus your efforts on a specific geography and/or property type, the more you will know about the other properties that have sold in this market area, what factors are influencing values in this trade area, who are the active buyers and sellers in your market, and what data exists that will help you convince sellers to sell and buyers to buy.
    3. Ask for the Business: A lot of brokers are are trying to use social media, email blasts, postcard mailers and other methods to get information out there about themselves. This is great. But if you really want to list more property, ask for the business. This involves getting on the phones and getting in front of people and asking for their business. You know the old adage, “if you don’t ask, you don’t get.” Ask!
    4. Ask for Referrals: In addition to asking people for their business, ask people for referrals. If you want to learn more about asking for referrals, I encourage you to read, The Referral Code by Phil Glosserman and Larry Pinci. Written as a fictional story (like Rich Dad, Poor Dad), this book will help you perfect your ability to ask for referrals.
    5. Build Your Brand: Write articles, lead industry related events, send out useful emails, mail articles to potential clients that may affect their property, announce your listings & sales, be generous, and so on. Although your goal is to list and sell properties in 2011. Do not forget that your goal is to constantly be building your reputation as the expert in your market.

    Take the 5 actions above you will list more properties in 2011.  

    Value Added Brokers are always improving! 

    Have a successful 2011!

    Being a Commercial Real Estate Broker is as American As Apple Pie

    Submitted by Brad on December 22, 2010 - 9:20 am

    I just finished reading Sarah Palin’s newest book, America by Heart. Whether you agree or disagree with her politics is irrelevant to many of the ideas addressed in the book. So much of her book is simply about what it means to be an American. Whether you are reading this blog as a U.S. citizen or a citizen of another nation (yes, we have non U.S. readers), there is little doubt in my mind that as a member of the commercial real estate brokerage community, you share many of these common values. As I read the book, I realized that commercial real estate brokerage is the type of work that would make our nation’s founding fathers proud. Here’s why:

    Self Reliance: You don’t eat, if you don’t hunt. And sometimes even if you hunt, you don’t eat. CRE Brokers are a unique breed in today’s economy. We rely on ourselves to create opportunity. We don’t depend upon big government or big corporations. We are individual entrepreneurs taking advantage of the opportunity created by this nation.  

    Independence: CRE brokers are independent people. Most are self employed and have tremendous flexibility in their lives. With this independence comes a lot of responsibility to manage yourself according to your own set of values.

    Community Oriented: Most CRE brokers make their living within a fairly small geographic area. They are either industrial or office brokers that specialize in a certain trade area. Or they might be hotel specialists who work within the hotel community. Regardless, most successful brokers (I actually would like to say all) are focused upon a certain community and need to contribute to this community in order to be successful. Our founding fathers believed that individuals looking after the best interest of their community, would lead their communities in a positive direction.

    Service to Others:One of my favorite quotes is by Zig Ziglar, “You can achieve anything you want in life, if you help enough other people achieve what they want in life.” CRE Brokers are the middlemen who help buyers and sellers, landlords and tenants, achieve their goals. Although this is not altruistic service since you are expecting compensation. It is nonetheless service that is designed to help many people achieve or continue their “American Dream”.

    The Quest for Freedom: Ultimately, if you asked most CRE brokers what their ultimate goal is, just about every one of them would say that they are trying to create enough wealth for themselves and their family to have the freedom to do what they want, when they want. They won’t answer that their goal is to serve enough years so that they can collect their pension. Furthermore, one of the reasons why they are CRE brokers is because their is an ongoing sense of freedom in being able to choose your working hours, your clients, the firm you associate with, and how you conduct your business. CRE brokers experience freedom every day of their career.

    So as you try to enjoy some time with friends and family over this holiday season and prepare for what will hopefully be a great 2011, appreciate that for all of the challenges of being a broker, you are in pursuit of life, liberty, the pursuit of happiness and the American Dream! 

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