Specialist Skills For Commercial Real Estate Agents

Commercial real estate is a very special property market activity. The people who are most successful in the industry are those who tend to specialise in a property type (office, retail, or industrial) and a property service (sales, leasing, or property management). This allows them to bring specialised skills and information to the market. In doing so, they can talk about specific rents and prices that are relevant to the property and location. People then respect and pay you well for this information.

The Right Person

No one person in the marketplace should know more about the local sales and leasing deal activity than the commercial real estate agent. This includes the supplementary professions of solicitors, accountants, valuers, financial consultants, tenant advocates, and bankers. You want these people to see and respect you as the person that they need when the local property challenge arises. You are then the ‘pain relief solution’ for the problem property situation. Your clients and prospects know that you are then the right person that has the plan and the strategy to move the property in a timely and efficient manner that achieves the best end result for all concerned.

Strategy is therefore another key component of your services. Knowledge without strategy will not give you strength as an industry professional. When you put your awareness of property prices and rents together with a strategic view and plan of selling and leasing, you then bring real value to your clients and prospects. Talking to your clients strategically is a significant skill to develop and leverage from. Knowledge and strategy give you confidence in the activities and listings that you undertake.

Specialist Information

This knowledge takes specialist observation and collation of information. Current rentals and sale prices, together with building costs and development costs are all part of the equation. The deal or property that you see advertised in the local paper or the Internet is not necessarily a final deal. It is the actual figures of the final transaction and strengthens your position as a well qualified leasing or selling agent in commercial real estate. This says that you must be able to collate and analyse the transactions. When you have for this information, the property investors and the owners in the marketplace will come to you for the specialised service that you offer.

The commercial real estate agents that struggle in the marketplace usually do so because they have not developed sufficient focus and system around their daily activities. It is very easy to chase every opportunity without sufficient reason to do so. In other words you can waste your time on a daily basis, and landlords and tenants will be very happy to let you. It is the quality of the transactions that is most important.

Essential Processes

There are a number of essential processes to use as guidelines in your daily job. They are –

  • keep a clear plan to each and every day with the focus on the essential business building activities
  • remember that you work for yourself and your activities generate your commission
  • maintaining a solid channel of communication to all your prospects and clients
  • adopt solid documentary procedures so any misunderstandings and errors can be minimised or eliminated
  • energise your focus to your key tasks on a daily basis
  • adopt a mission mentality
  • understand that you are the person to build the deal for the transaction

Key Players and People

The most successful people in the industry maintain ongoing professional contact with the key players of the marketplace and most particularly –

  • property owners
  • major tenants
  • major business proprietors
  • solicitors
  • accountants
  • quantity surveyors
  • engineers
  • builders and developers
  • property surveyors
  • banks and lending institutions

You must leave absolutely no stone unturned within your marketplace to build your listing and selling opportunities. The people detailed in the above list must understand you to be the knowledgeable commercial expert that they can use when a property challenge is presented.

Many real estate agents have made significant commissions and listings from solicitors and accountants, as these people are the doorway to many property owners. The key to the door involves your knowledge and your skill as a commercial real estate agent that knows the local market.

There is an Old Saying in Real Estate That 90% of the Real Estate is Sold by 10% of the Brokers

This is not far fetched. There truly is an entirely separate class of Real Estate Professional out in the marketplace. The full time professional verses the part time pretenders. The ten percent minority consists of realty professionals that are most often full time, Type A, workaholics that are both social and very personal creatures.

The reality is that with the current marketplace many of these true and worthy professionals are leaving the real estate industry for other careers. The frightening part is that with this occurrence the 10% is now a diminishing figure.

Most office Brokers or office Owners will confess that the bulk of the work in their entire office is now being performed by just one or two agents. All the other Realtors that are named as members on the office roster of Realtors are simply “hanging their licenses at that office.”

Well what so scary or strange about this? Of course agents need to go elsewhere so they can feed their families!

As a Seller or potential Seller the odds were and are now greater than ever before that if you hire an agent and do not have proof positive or first hand experience that this agent is in this 10% professional category you have a 90% chance of hiring someone who is not effective for your job That’s an 80% to 90% chance that you will entrust the wrong person to work for you and handle the sale of your single largest asset. These odds are unbelievable. Nine times out of ten a Seller will pick the wrong listing real estate agent. Would you hire a painter, hairdresser or doctor if you stood a ninety percent chance that it was a bad choice?

The way to prevent this is simple. Don’t roll the dice and take the chance. Do not hire and list your property for sale through a listing real estate agent. Sellers you can easily place your property on the market without a listing agent. Go online and inexpensively advertise the property. Make sure you offer to cooperate and pay a commission (one half of the commission that you would have listed for) to any Buyer’s Agents that bring you a qualified buyer for the property.

A Seller does not need to concern themselves with whether a Buyer’s Agent is good or not. They are easy to recognize. A good Buyer’s Agent is the one with a good Buyer.

Insights From an Investor of Real Estate

I entered the real estate marketplace when residential real estate was financed thoughtlessly by lenders of many forms. Funds were flowing directly into the market rapidly from not merely banks and mortgage brokers but private investors, as well. This condition was fantastic for me due to the fact it permitted for two essential factors of residential real estate investing to take place.

Initially, I had been in a position to immediately sell to purchasers with financing properties which I had bought at a discount. This became crucial due to the fact I had received my original investment plus profit inside a brief time period. This permitted me to purchase far more houses using the proceeds obtained. Possessing a supply of purchasers with financing is definitely the essential component to making money in real estate. In 2008, the real estate marketplace changed—I will clarify later.

Additionally, there was the advantage of capital with relaxed terms. This capital wouldn’t have been accessible without the pressing desire of lenders eager to lend. Along with this the actual rates of interest for borrowing funds was low. The funding I had use of didn’t require individual guarantees. The assets bought using the loans had been all the security necessary by lenders. Once more, this was only achievable due to the significant quantity of buyers with financing within the market ready to buy households for private residence or perhaps investment.

Previously when I stated 2008 brought a massive transformation to the residential real estate sector, I meant several dramatic events occurred. The credit markets had started to stagnate. The buyers started to fall out of the marketplace; not merely did first-time potential home buyers give up; but the private capital left the marketplace, also. Investors of real estate had been left with a single strategy to sell properties. That strategy ended up being to owner finance buyers not able to acquire financing from the banks. Just about every investor in the course of that period can attest towards the fact that there had been plenty of buyers in need of financing; however with that demand, numerous pitfalls for seasoned and non-seasoned investors began to emerge.

An additional tool for me as well as for other investors within the industry that had been saddled with considerable residential real estate portfolios was to owner financing. Owner financing was the only real option to prevent investors from being foreclosed on or possessing a property which was not producing income to pay the monthly loan payment. For many investors, this was supposed to become a short-term tactic. The majority of residential investors weren’t preparing for a long-term approach to real estate investing. Most new investors believed the real estate boom would last forever. Investors interested in owner financing started taking 5% to 20% down payments for their houses which permitted household purchasers wanting to purchase a residence the opportunity. For many investors, that 5% to 20% down payment bought an additional three months to remain afloat while they hoped for a miracle.

Having received the down payment the investor would carry a short-term loan for one to three years hoping the home buyer would be in a position to obtain a bank loan which would permit the investor to pay their loan off. Well, quite a few of those house buyers couldn’t acquire loans and many of these individuals lost jobs which prevented them from paying the monthly payments to the investor. Some investors, in financing house buyers, produced mortgage notes with monthly payments much less than what their actual monthly loan payment was to the bank to prevent having to pay the whole monthly payment out of their pockets. So, you discovered a great deal of investors who had no income coming in from real estate and who couldn’t locate jobs; consequently, those investors stopped paying their mortgage payments to the banks as a way to have income to live on.

Soon, after six to nine months, the banks foreclosed on the investor’s properties; nevertheless, there was a significant issue, the investor had sold the house by way of owner finance to a family. Well, those families discovered themselves in the street soon after the foreclosure. Other investors attempted to rent the homes which became a different nightmare. A great deal of investors had been wiped out and many others left the real estate sector. A few of my partners and associates began producing videos on real estate investing, and a couple of them earned far more income in that then they ever did investing in real estate.

Adversity strengthens:

I was not able to avoid the crisis; but I had been in a position to accomplish two things. First, I had been in a position to sell my assets that had been rehabbed or not part of my general investment approach. Next, I was able to balance my activities around other elements in the real estate industry. In 2011, I launched into consulting and land development. I continued to buy houses in San Antonio when the opportunities matched my strategy; but I didn’t have all of my activities in one basket. I believe one of the most essential lessons learned in the course of that period was adaptability. You will find excellent possibilities within the industry; however, the opportunities are no longer focused on a single niche. Surviving in this new environment, an investor will need to have an understanding of all facets of real estate investing.