Are there dangerous clients in commercial real estate? Absolutely; yes is the answer. You will come across them all the time. You must protect yourself from these clients that are out to manipulate the deal for themselves without true transparency.
Ethics in our industry is really important. Poor quality clients can derail your listing integrity and commissions. So the message is that you should keep to the rules in the industry that protect your actions and listing activities. Clients that are less than honest can destroy your business in many different ways.
So here are some signs to look for when it comes to client selection and communication:
- Watch out for the clients that will not sign an agency appointment ‘until you find a buyer or tenant’. The request happens all the time in our industry but you cannot and should not act outside of the laws of commercial real estate agency in your location. You are bound to act legally and with integrity; if the client wants you to ‘bend the rules’, they are not a client to have and you simply cannot trust them. In those circumstances walk away from the deal or the listing. Let some other agent waste their own time and risk legal action. It is not fun when legal claims are made against you.
- Some clients work with many agents. Now this is just fine if all relationships are ethical and legal, but your listing and negotiation information should be protected by a valid appointment to act and an established client and agent relationship. If you suspect that the client is sharing your ‘market intelligence’ with other agents, you could have a problem.
- If your client avoids giving you an exclusive listing, it can be a sign that you really do not have their commitment and trust. They could also be working with many other agents at this very moment in trying to sell or lease the property. Ask the questions and get to the real facts of the matter.
- A reluctance to give you full access to the property or comprehensive property detail is a sign that something is going on. A similar problem is evident with the client not disclosing tenant and income detail for the property. If the client is not being open and honest, step back from the deal until you know all the facts. Get copy of all current property related documentation before you go to the market, negotiate, or talk to other people. Understand the facts that are before you.
- Failing to put things in writing can be a big problem in our industry. Many conversations across the telephone happen every day. Always keep your notes of client and customer conversations and instructions. Evidence the matter back to the other party in an email or similar written or electronic form.
Lastly something should be said regards confidentiality. Know who your client is and what their instructions are. Keep client agent discussions and instructions confidential. Disclosure of privileged information can get you into a lot of trouble.
The retail shop leasing process is quite specific and special. It requires property agents that are very familiar with the retail industry and shopping center dynamics.
It is no secret that the retail shop industry is changing due to the impact of the Internet and the current economic circumstances globally. That being said, the retail shop industry doesn’t disappear it just changes. We are best placed has specialized leasing agents to help tenants and landlords move through the process of change when it comes to shopping centers and specialist retail properties.
Here are some tips to help you with creating your retail tenant mix and plans for shopping center leasing optimization:
- Check out all of the other competing properties in the local area. They will have factors associated with vacancy, tenant movement, and tenant success. Make a list of their tenants for direct contact and cold calling. Some of those tenants will be more successful than others. It is those tenants that you should encourage to move to your property.
- Look at the other competing properties with regards to property improvements, customer access, and customer profile. Also look at the factors of car parking, public transport, and property size. Are there any weaknesses in these factors that can be optimized in your property?
- The franchise groups in the local area will always be a good opportunity for tenant enquiry and new leases. It is simply a matter of understanding the properties that they are looking for. It is likely that they will have specific lease terms and conditions that apply to any premises that they negotiate on. You will need to brief your landlord on the standard terms and conditions that the franchisor requires. The franchise agreement needs to integrate with the lease of the premises. Your landlord needs to understand that fact so that the business can operate within the branding and business agreement requirements of the franchise group.
- With any larger retail property, it pays to stay ahead of any lease issues. They include rent reviews, options, and lease expires. Look at all of these events at least 12 months in advance. This then allows you to plan the interaction with the tenant given the conditions of the local property market.
- If you want to be a retail leasing expert, grow your knowledge with regard to business viability and different business types. Some businesses have different requirements as to cash flow and occupancy costs. If those requirements are exceeded, it is likely that you will have an unsuccessful and volatile tenant. Ultimately that will mean a new vacancy.
- With your existing tenancy mix, consider the factors of expansion and contraction as they apply to each particular tenant. Help the existing good tenants within the property to adjust the leasing needs and remain in occupancy.
- The anchor tenants in a retail property are very important to the overall success of sales, specialty tenants, customer visits, and market rental. Stay close to the anchor tenants as part of an ongoing lease strategy.
- Retail leasing and shopping center performance are quite unique strategies to be developed for each landlord and property location. It is not unusual to have a business plan developed for each medium to large property. In that plan you will have income profiles, expenditure management, maintenance plans, tenancy strategies, tenant retention solutions, and reporting requirements.
Retail shop leasing is perhaps one of the most interesting and rewarding segments of the property market today. That being said, it does require people that understand retail business and property viability.
In commercial real estate agency it is very much the case that the day will take over your diary unless you take control. People will impose on your time and things then will go absolutely nowhere.
If you are like me, you will hate people wasting your time. In our industry time is money and we need to remember that. In an average day lots of people will want a slice of your time. How about this list for starters?
- Existing clients with their listings
- New clients wanting to list their property
- Team leaders wanting to talk about the weeks results
- The boss (for all sorts of reasons)
- Tenants looking for property
- Buyers wanting to inspect your listings
- Telephone enquiries
- Administrative people needing help getting your marketing campaigns underway
So, all of this says that we need to set some solid rules that will not be broken or changed. We must control our time as it is the main thing that we can control in commercial real estate agency.
Systems can set you free to get on with your business. When business runs smoothly then you find the clients and the listings that you need.
Every system in commercial real estate is essentially made up of subsets or systems for key things. Each part of the process can be refined and improved. I have had systems for all of the following:
- Prospecting systems so I can keep focused on the right properties and clients that will need my services one day. Every good commercial agent should have a pipeline of some type.
- Presentation processes so that every property that I pitch for is a deliberate pitch that is well controlled to a solid approach that I know works. Confidence here is the key.
- Listing systems for each property type such as office, industrial, and retail property. I would also have systems for sales, leasing, and property management. Retail shopping centres are quite different and feature with their own systems that are unique to retail.
- Inspecting a property is quite special and having a process for that is wise. A checklist to help you ask the right questions and look at the right things in the property will always be of benefit. The inspection system should take into account the property type and the location; that is why you need checklists for this.
- Marketing processes for the listings that we work on should not be generic or ordinary. The fact of the matter is that each property should be uniquely promoted to a plan; this assumes that it is an exclusive listing and you have vendor paid marketing funds paid in advance.
- Negotiations and communications with clients should be documented. It is common that things will get delayed or changed when you are negotiating with a client on a sale or a lease. When you have the supporting documentation and notes, nothing can go wrong.
If you are finding that things are out of control and you are struggling as an agent, take a look at your systems in commercial and retail real estate agency. Build some processes and controls that help you move forward.
When it comes to your career in commercial real estate agency, you will sometimes feel the pressure of the market and the industry. It is very easy to panic when you have no listings and or commission coming in. Here are some tips from our Newsletter.
There is no point in panicking when it comes to your job and your market share. If you feel the pressure of listings and commissions, it is simply a matter of developing a prospecting system and actioning it every day. Over about three or four weeks, you will soon see the market turn more favorably back towards you.
One of the biggest problems in our industry is consistency on the part of the salesperson to build market share. Each and every day top agents work towards consistency and systemized prospecting; you should do the same.
Success in our industry is largely created through ongoing personal contact with the correct people that matter in our industry. Over time those relationships build listing opportunity and better market share.
If you feel some degree of panic when it comes to your market share, listings, and commissions, it is time to establish a system to take yourself forward and out of the difficulty. Momentum and action taken immediately will help you lessen the frustration and panic you currently feel.
When you start moving towards a plan, and you stick to the process, you will soon see that the magnitude of the original problem was not as great as originally thought. You are in control, and you can resolve any pressures that you currently have. It is simply a matter of modifying your choices and habits. Systemize your day; that is the secret to progress.
Here are some ideas to help you move forward with this and build a better market share over the next 12 months.
- It is extremely important that you control your time on a daily basis. You are the only person that can do this. There will be demands on you from business colleagues, clients, the agency principal, and others that can destabilize your focus on a daily basis. Keep things simple. Understand what you must do every day, and do it regardless of any pressure from others. Take control of your time. Set aside the time that is required to do the key things to take you forward. Most particularly that will be prospecting and you should do that for approximately 2 or 3 hours per day.
- Start building relationships with the right people in your industry. Have a look around the local area so you can make contact with business leaders, property owners, and property investors. In the right market you can also add property developers to the list.
- It is a well-known fact that the degree, to which you believe you are in control, is the degree to which you will be successful. Successful people are in control each and every day. They make the right choices and take the right actions. They will not waste time with the wrong people or wrong circumstances.
The commercial real estate industry is one of the most rewarding and challenging of sales careers. You can meet some great people and earn a lot of money in the process. All of that being said, you really do need to selectively choose your actions and your key tasks each and every day. This is part of an ongoing personal marketing process.
You can get more tips like this in our Newsletter.