Choosing the right commercial real estate agent is key to your success. After spending 2 years as a commercial real estate agent after my 7-year tenure in residential real estate I’ve discovered that commercial real estate agents are a different breed. They are highly competent but well respected. Choosing the best commercial real estate broker to work with requires understanding how they perform their duties. Do you not concur?
Commercial real estate salespeople can be a bit intimidating, I am aware of the intimidation. They don’t appear to be as welcoming as residential agents. T They always wore suits, they kept a professional demeanor. Their lingo and the way they talk are quite different. The offices were big, their teams are large, and they have some of the most prominent clients. Sometimes the words they said went completely over my head. But, I had to jump right in just like anything else. I called them, I left messages I sent emails. If I made a mistake, it was my fault, oops. Guess what, I had more chances. I eventually developed relationships with them and did well. Once they saw my name a lot, my name on signs, or deals I’ve done, I was accepted to a certain extent.
This is what you will learn from this page
- I learned these two things after working with commercial agents for two years
- Expectations of commercial real estate agents in the market
- Locating the right commercial real estate agents to connect with
- Thee five requirements you want to consider of a commercial agent
- When you should start working with a commercial agent and how to do it
- Why would a commercial real estate agent want to work with you
- A few things you want to avoid when working with a commercial real estate agent
I learned these two things after working with commercial agents for two years
They are normal people
- These are the same poeple I see at the gym, or the pool, or at the local coffee shop They are just regular people dealing with everyday life event and problems. Many of them have confided in me that they worry about their employment or their family or even their income. Some of them even told me they want to buy real estate like me. Some do not own much real estate and are open to suggestions. They’re just like regular people. They are similar to you. This is a reminder not to be intimidated.
There is a vast difference between commercial real estate agents and residential agents
- Commercial and residential real estate agents operate very differently from one another. The key distinction is that a commercial real estate agent has a business-oriented mindset. He is serious. He has his business in mind. A residential real estate agent’s duties center on a homeowner’s and his or her family’s wants and interests. You’re curious as to what that signifies. So, as compared to residential agents, commercial real estate agents rely less on feelings. They rely more on data and economics of the deal whereas residential agents will look at school systems and neighborhood among other points.
Your Expectations of a Commercial Real Estate Agent
It’s a good idea to figure out what you need, and what you want from a commercial agent before you reach out.
1. You Desire off market or pocket listings
That’s what you ultimately want. There’s deals all over LoopNet and CoStar and other things online. We want the deals that are not online, that are not on an MLS, that are not on LoopNet. You want their pocket deals because those are the best deals. Those deals are going to make you the most money. Those deals don’t have the competition that you have with deals that are online. Let’s face it, the deals that are online, they’ve been picked over, and those are basically the left-overs. You want the pocket listings, the off-market deals.
2. You want them to return your calls
One of the common complaints I hear is calls do not get picked up. No one returns calls. No one emails back.
3. You want updated information on current on market listings
4. You need sufficient market information to make buy and sell decisions for any asset type or commercial type you’re looking for.
A buyer depends on agents to provide such information. It might include demographic data, rent comparisons, sales comparisons, or any combination of the aforementioned. They are the ones who provide us with that knowledge.
5. You desire a reliable and practical commercial relationship with a commercial agent
They want the same thing you want! They want an equal relationship
6. You want them to refer us to important industry players like property managers, bankers, lawyers, inspectors, surveyors, other investors, and so forth.
Due to their position and tenure in the field they will have great resources and knowledge. Referrals are the greatest way to find vendors such as property management, handy men, painters, inspectors, counsel, and insurance guys Your going to want to connect with people who are happy with theirs and get those referrals. What you want is access to pocket listings, call-backs, information on current listings, enough market data to make decisions, solid and professional connections, and referrals for essential employees.
So how do you choose a Commercial Real Estate agent?
There are 2 options:
- You want a referral
- FInd someone who has just done business with a commercial real estate agent and ask them.
- “What did you like most about working with them?”
- “What is the least favorite thing you liked about working with them?”
- “Would you work with this broker again?”
- “Were they responsive”?
- FInd someone who has just done business with a commercial real estate agent and ask them.
- Look online for a commercial real estate agent
- Google commercial real estate agent near you. Scroll past the top 5 or so paid listings and you will arrive at the business listings. There you can find an actual commercial agent to connect with. Look to see if they have reviews. It’s important because that means they are doing business. You can also scroll down further and see if any agents are writing blogs. Which typically means they care about their business and are active in the field. Otherwise, you may land at a brokerage that has hundreds of agents and you may not know who you end up with.
Expertise of the broker’s area
Here’s something that’s relevant to both recommendations and online sources. Is the broker’s primary area of focus the same as yours? That is to say, most brokers concentrate on a certain asset class. For instance, you may want to work with a multifamily specialist or work with an office broker. Some of the bigger companies like CBRE or JLL, their agents work in certain zip codes or just certain asset classes as they are experts in their particular fields. Whereas there are some agents who work in all asset classes because they are at independent non-institutional companies. Always good to at least ask what they re working on and if they feel comfortable working in the asset class you are looking for. There could be different sizes and dollar amounts that certain agents may feel more comfortable in.
Retail Commercial Real Estate Agents
There are many commercial real estate agents who only do retail leasing or retail sales. They picked this class of commercial real estate because they want to specialize in it. Real estate utilized largely for retail sales is referred to as retail real estate. These properties were created and planned particularly to house retail establishments such shops, stores, restaurants, malls, and outlets.Because they are designed to draw and serve people who are looking to buy goods or services, retail properties are special in the real estate world. In order to enhance their visibility and accessibility, these properties are placed in highly trafficked locations or close to residential areas, business buildings, or tourist attractions.
Who you hire matters when choosing a commercial agent. The process of renting or leasing commercial premises to retailers is referred to as retail leasing. It involves an agreement for the rental of a particular retail property by a tenant (a retailer) for a predetermined amount of time between a landlord (the property owner or property management firm). Retail leasing is crucial for both landlords and retailers. For landlords, it generates rental income, helps maintain property value, and ensures the utilization of their commercial space. For retailers, it provides a physical location to showcase and sell their products or services, attract customers, and establish a presence in the market.
Retail Sales in Commercial real estate
Retail sales in commercial real estate is an asset class of it’s own. It can be the selling of retail plazas or it can be selling stand-alone buildings with single tenants. They can range from small retail centers, to standalone or huge retail centers with many tenants. It’s an exciting asset class to be involved in.
When working with a commercial real estate agent, if he focuses on warehouses he may not want to or even be the right fit to help you on the retail side of things.
Something less important when working with a commercial agent is the size of their office
The size of their office is not a crucial factor. Boutique firms are some of the greatest companies you may work with. There are three individuals working there, and they are the greatest in that part of the country. These three guys are in charge. They control the city. It doesn’t necessarily follow that a company with 100 brokers or an incredible marketing and software system has the best brokers or will work best for you. This company only serves one customer. It all comes down to the particular broker. A relationship-based industry, this is.
Your commercial agent should have these 5 qualifications
- The first requirement is that you want them to be authorities in their area of expertise, asset kind, and geographic region.
- Great communicaiton
- I hear this all the time “my agent doesn’t pick up the phone”
- You need them to have strong connections in their field so they can put you in touch with other valuable business people.
- When you have a terrific relationship with a broker they may introduce you to other professionals that may help you better than them as it’s a different field. You want a person with a lot of connections in their industry.
- You do not want part-time brokers helping you
- Part times are a big no-no in the commercial industry. They need to be dialed in, and not on beach front condos, they need to be in commercial.
- You want them to understand all of your needs
- A good commercial broker will ask you lots of questions. I’m not sure what is more important, a broke who is an expert in that field or one that is asking you all the right questions so he can go and find you the property that fits. It’s important that the broker is diagnosing your needs, listening, and taking notes. I’ve heard many times “No one asked me that yet, that’s great”
How to Start Working With a Commercial Real Estate Broker
- You need to define what you want
Let’s define that first. I’m going to define it for you. If you are in the warehouse business, I’m going to tailor this for the warehouse investors out there. When you first start working out with a commercial real estate broker, call them and you introduce yourself, and they ask you, “What is it that you’re looking for?” Be direct and to the point “Hi, I am looking for industrial properties with 10 bays and 20,000 square feet in Broward County,” or you can say, “I’m looking for value add industrial product between $2,000,000 and $5,000,000 in west Broward.
You gave them the class, classification of properties, the type of properties, you gave them the price range, and you gave them the location. Nothign else needs to be said ecpet maybe how you are structuring the deal financially. Don’t talk cap rate or ROI initially because both of those are pretty subjective. If you start saying you are looking for an 8 cap deal and they’re located in a 5 cap market, guess what they would do. They are probably not going to contact you again.
2. Now you need to jump right in and get started
Just jump right in, make the call, and make the connection. Don’t put off asking for the listings, just get it done. Once you are done reviewing the listings, you will want to give the agent feedback. The only way they can understand what you are looking for is to get that important feedback. After going through a few will be more familiar. Understand that if you do not respond the agent may think you’re not serious and spend more time with other clients. It’s really important to think of this as a relationship. IF you want to be treated as a VIP client, you should treat your broker as a VIP broker. So make the call, check out the listings, take good notes, review them, and get back to your agent timely.
Why does this Commercial broker want to work with you?
Although I am aware that this is about your decision to engage with a broker, it applies to both parties. Why should they collaborate with you? How do you present yourself in a way that commercial real estate agents want to work with you? I once was asked by another Broker, can you tell me the attrivutes you look for when picking to work with a client?
There are 4 things
- Agent want someone who is responsive when they call
Quite intriguing, huh? It’s interesting that I said that right? As you may recall, brokers’ failure to return calls is a very common complaint we hear. When we call, we are requesting that you answer. Whether those two are related, I wonder. That is the first action we request of you. We expect you to respond.
- They want to make a commitment to work with you
They want you on board if they are going to put in the effort, put the hours in, grind it out and bring you deals. They want you to be dedicated to their business and not just treat them like one of ten brokers. Moreover, they will most likely want you to sign an exclusive agreement if they value their time and yours.
- They do want some chemistry
They want to like you and have a productive relationship. They want to have some chemistry, you need to be enjoyable. If you are a grump and treat them like 1 out of 10 brokers you will loose the relationship. They want you to return the calls.
- Here is one thing that may surprise you, they are not saying you need to be rich with money falling out of your pocket.
He avoided saying that he needed a rich client. He made no mention of wanting a very affluent client with money falling out of his pockets, LOL. That was not discussed at all during our talk. He values your responsiveness, commitment, and relationship-centeredness above everything else. As a result of your responsiveness, your commitment to him, and your relationship-focused nature, a broker would pick you to work with.
After reading this blog pick up the phone and call a commercial agent right away. You don’t need to have all your ducks in a row. Having an established relationship is important. You don’t have to have all your financials ready to go, just make the call. An excellent credit score or be required to make a deposit is not needed. You are establishing relationships and seeking some knowledge and putting a game plan together.
You only regret the shots you never took. So get out there today and establish your relationship with the right broker. For full disclosure, I am a commercial real estate agent born and raised in South Florida. My strong suit is I am very accessible by phone or in the office. I call my clients back promptly and almost always answer on the first ring to my committed clients. Furthermore, I put a lot of work time in. I am not afraid to put endless hours in for my clients. I find it enjoyable and am willing to go the extra mile with my commute client who sign agreements with me (not the ones browsing for handouts with brokers already in place).
Lastly, my marketing is far better than 90% of all commercial realtors. I understand how to leverage social media, websites, and ads. Most commercial brokers are older, and not adept with technology. I run circles around them in advertising. When combine with my ability to email prospects and cold call, I can really get in front of clients and properties faster and in more duration than 90% of all other brokers. Feel free to contact me.