PROSPECTING COMMERCIAL REAL ESTATE LISTINGS
Retail and Industrial Business Listings
Any real estate agent or broker who wants to have a successful career in commercial and industrial real estate should regularly obtain marketable listings. Listings are the brokers of “stock on the shelf” and your income now and in the future depends on both the quality and quantity of the listings you get. The more listings you have, the more buyers and renters you will attract. This makes bidding much easier for you. More listings means you dominate your market and lessen the impact of your competition.
In commercial and industrial property, listings may commonly include:
- Land suitable for commercial, industrial or retail development.
- Commercial, industrial, and retail buildings for lease
- Companies that occupy premises from which they serve and supply their markets
- Commercial, industrial and retail buildings that are for sale to owner occupants or investors, both large and small
Development of a customer base
The secret to success in commercial and industrial real estate is having your own client base. Those clients who work comfortably with you and who respond positively to your advice regarding their real estate requirements are the clients you need to develop. Since your fees are paid by clients, not tenants or buyers, they are very important people in your business life and it is essential that you represent yourself strongly to them at all times. As these individuals and organizations readjust their property portfolios to meet emerging real estate requirements, they will continue to provide you with listings. Also, if they are satisfied customers, they will recommend you to other business leaders, friends and family, thus bringing you more business.
Knowing the Real Estate Market
In order to provide effective advice to potential clients, it is essential that you know the market – commercial, industrial or retail – in which you are involved and that you have a detailed knowledge of the geographical area in which you operate. To do this effectively, you will need:
- Travel your territory constantly according to a plan and be known by the companies and people in the area.
- Know every property that is for sale or rent in your territory
- Maintain a list of property transactions that occur and have occurred in the last 3 years
- Keep an eye on the private transactions of the owners
- Involve your office management and other team members with what you are doing
- In addition, you need to understand the factors that motivate businesses in your area to relocate and be aware of the forces that encourage investors to buy and sell in your area or venue.
WHAT MAKES A SUCCESSFUL AGENT OR BROKER?
So what makes an agent or broker successful from a customer perspective, and someone the customer wants to do business with? It’s an interesting question to ask from a client’s perspective, but history shows that the factors that stand out as being of prime importance to clients are the agent’s knowledge of the market and the quality of advice provided. The agent’s negotiation skills and ability to act quickly are also important and rank high. Compliance with client instructions, property marketing skills and confidentiality were considered to be of slightly less importance.
It is clear from this analysis that the factors that are going to have a vital influence on the successful listing of a client’s property are knowledge of the market and quality of advice. Homeowners look for agents and brokers who know the market and have readily available listing information on companies and investors looking to make immediate decisions on the properties they require, own or occupy. Your clients want an agent who immediately brings a listed property to their attention.
Therefore, at the time of listing, being able to effectively communicate with the owner about the commercial and industrial market and prospects that are available in their database could certainly lead to a successful and hopefully ongoing relationship.
Where do you find new listings and how do you go about converting them? This list can help. As you get to know your customers and the geographic area of the market you operate in, opportunities for listings will present themselves. For example:
- Real Estate Transactions. The successful conclusion of any real estate transaction in your region means that both the buyer and seller may be looking at other options. Take advantage of these opportunities.
- Settlement. A failed business is a prime target for agency activity.
- Vacant Buildings. Keep an eye out for any vacant or abandoned buildings as they represent business opportunities.
- Intermediaries. Maintain close association with real estate brokers. Intermediaries include people such as financiers, bankers, insurers, builders, architects, engineers, lawyers, and accountants. On occasion, your clients will require the services of real estate agents and a recommendation from these individuals is invaluable. You, in turn, can introduce your clients to these brokers, thereby establishing and maintaining strong business relationships that benefit both parties.
- Newspaper articles. Articles prepared by you or in which you are quoted draw the public’s attention to your name or that of your company.
- Direct mail. Regular mailing of property solicitation letters, when sent to an appropriate group of prospective investors or owners, frequently result in listings.
- private ads. These can indicate properties that are on the market and owners can be encouraged to engage their services if initial listings have been unsuccessful.
- Neighbors in the immediate area
- Property management (rental list)
- Entrepreneurial Activity
- Previous suppliers and buyers
When you discover a property that you think could provide you with a business or listing opportunity, it is necessary to identify the owner. The following pathways can often provide this information.
- Your own office (In each agency there is substantial information on previous transactions and ownership of the property that can be consulted).
- Local government records
- Land title information
- Electoral Registers
- The Telephone Directory (including the Yellow Pages in the case of companies)
In addition to this, there are many other sources of information that can be used to identify owners. These are:
- Property Property Lists
- Historic Land Sales Records
- Use other agents’ signs as a reason to talk to adjacent property owners on the spot
- Commercial property trades on an investment cycle and history shows that it is roughly every 5 years. Look at past sales records in your area for the next potential sales cycle.
- Tenants will usually tell the property owner if you ask
- Directory boards in buildings are a great source of leasing intelligence
- Business telephone lists and contact names of the CEO
- Stock Exchange Information and updates
- Company Searches for large companies in your area
- News stories and articles
- Be willing to dare and try something new.
To undertake this process you must be diligent and thorough in your activities so as not to leave any ‘stone unturned’. Nothing is more frustrating than another agent’s for sale or rent sign showing up in your territory that you just covered last week.
The above information may seem logical; however, it is commonly overlooked or not acted upon in most cases, as many salespeople do not have the personal and sustained discipline necessary for the task. The best commercial real estate agents and brokers use this model as their source for listing opportunities.
In closing, we must say that this prospecting process requires a good database program to record and channel your ongoing findings. The value of a good database program is high on the list of tools for a professional agent or broker working in commercial real estate. Good hunting!