5 Tips for Starting out in Commercial Real Estate Brokerage
In the winter of 2016, a family member informed me that Latitude Commercial Real Estate was looking to add a fourth broker to their staff. They were looking for someone ambitious with professional work experience willing to learn the ins and outs of commercial real estate. I got in contact with Aaron McDermott, went through an interview process, and on May 16, 2016 I started my career with Latitude and also started classes for my real estate license. By the end of June, I had my license to practice real estate.
Switching careers can be stressful but exciting at the same time; the pace of life changes, you must learn an entirely new skill set, and you go from being someone whom people come to for advice to being the guy going to other people for advice. Your life changes in and out of the work place. Below are my five tips for every new broker:
- Vet your leads. Being new to the business can be scary, and you tend to work with anyone you can find. Random guy calls in about some retail space he wants to see? Oh it’s a new business, he wants to sell trinkets he makes at home. He’s doing great on Etsy!. He’s looking for about 3000sf, because he needs a lot of storage, but he wants to stay within $500 a month rent. The kicker to this is that even when you search far and wide and manage to somehow find a place that matches what your new lead is looking for, they don’t sign a lease because, it turns out, they can’t afford the $500 a month after all. This isn’t to say that you should turn away new businesses, but be wary about how much time you spend with a client compared to how likely they are to close or sign a lease.
- Good deals take time. In early November of 2016, I cold called a local health care provider about a property we represent. Within a week I toured the property with the health care provider. They thought it was a good fit for them, and from there it was just a matter of working out a deal. Well, piece by piece, we worked through getting a deal done. In late May of 2017, we had a signed lease. In January of 2017 I showed a warehouse to a young couple that own a furniture store. They thought it was a good fit but they were busy at the time and said they would revisit it the property in a few months. They did revisit the property and they closed on it in late July of 2017. Never lose hope and keep in contact with good leads.
- Don’t take rejection personally. My goal every week is to control what is controllable. That typically means I’m making 50 cold calls a week. A majority of these are people just saying they’re not interested (with a good chunk of them still having a conversation with me about leasing rates, property values, and other various “ask a broker anything” style questions, which I do enjoy), a small chunk are leads, and a tiny percentage lead to transactions. However, the goal is always to make these calls, even if all 50 go nowhere. As was noted above, one good lead in November can be a good deal next July.
- They come back. Remember that guy who sold trinkets on Etsy? Well one year later he does some research, puts together a plan, and is looking for 1000 square feet for $1000 a month. The deals you didn’t close in the past will come back to you much of the time. They may be small, but they add up. Over time you get a lot of repeat customers. Your goal should always be to treat people with respect and be honest with them. Don’t be afraid to politely tell people that their expectations are unrealistic. Most of the time they will respect you for it and if you don’t tell them early on and it becomes an issue in the future, you’ll look like you didn’t know what you were doing and wasted their time.
- Make people remember you. My career prior to commercial real estate was social services, specifically working with and for the Indiana Department of Child Services. I did everything in my power to hide any details of my life and my hobbies from my clients. In commercial real estate, you need to do the exact opposite. People work with someone they respect and also someone they feel connected to. Being RB#8675309 won’t help people remember you. Do you have kids? Speak a second language? Work on cars? Share that with clients you’ve been working with for a while. The worst advice anyone has ever given is don’t do business with friends. You should make it your goal to build long term relationships with your clients.
At the end of the day, this isn’t a field for everyone. The most important trait for a broker is perseverance. Keep calling, keep learning, and keep in contact. Every day isn’t going to be a great victory, but you’re getting one step closer all the time.