Almost as important as the investment itself, building relationships is a key part of being a successful commercial real estate broker. If a broker develops a strong relationship with the investor from the opening bell, the chances are more business will come their way. The moral of the story for a commercial real estate broker is to not focus on the money or commission, but rather focus on the relationship.
Conversation Starter in Commercial Real Estate
Before the client, a potential investor, gets into the thick of the investment discussion, it’s important to spend quality time getting to know the commercial real estate broker. At Capital Rivers Commercial (CRC) in Sacramento, before meeting with a new investor, brokers host a prep call to ensure everything is in order. It’s important the broker knows the following so the discovery call with the potential client is productive:
a) looking to invest or sell,
b) investment background,
c) business background, and
d) personal background.
It’s paramount that the commercial real estate broker and the investor feel comfortable with each other. Relationship-building is important, especially when it comes time to discuss the investor’s goals and what they are looking to achieve in an open and honest fashion. The first meeting will most likely include some small talk to get the conversation started. They will also discuss what kind of investment they are looking to make, when and where. Then, the broker wants to make sure the client is qualified, because there will be a lot of time and energy invested in the transaction. The broker wants to ensure they are entering a contract with someone who will follow through and/or deliver on the final outcome. The client will be looking for the same type of relationship.
In addition, the broker needs to find out how the investor likes to communicate:
- Phone call: mobile or office number
- Email: personal or business address
- Virtual calls: Zoom or Teams
This might sound like basic information, but if the investor only likes to text and the broker sends emails, wires could get crossed at a key time of the transaction.
For an investor, building trust is an important part of the relationship with a commercial real estate team. The broker needs to connect with the investor in a proactive manner. A few things the broker can share early on in the process:
- Experience level
- Background in commercial real estate
- Similar deals they’ve handled
- Understanding of the market, including analytics
- Local and regional connections that will assist with deals
It’s critical for the broker to create trust by being transparent from the start. Building a strong connection is key in commercial real estate. In addition, the broker should make sure the investor understands the communication will be positive both ways (with the broker on the other side, possible tenants and more).
Selling or Leasing Property
- Marketing team creates all the necessary materials to showcase the property.
- Drone footage (depending on the size of the property)
- Virtual Reality Video
- Social Media
- Digital Ads
- Email Campaigns
- Before the property is listed, the broker will do a deep dive on the property, taking the investor’s best interests into account. This will include unfiltered conversations with 12 CRE brokers during their twice a week sessions. Conversation will include:
- Advantages and disadvantages of selling vs. leasing
- Possible Tenants
- Additional revenue streams for the property or land
- TI or possible tear-down to build commercial or residential property
The broker will also work to find potential solutions or opportunities that aren’t visible to the naked eye. An experienced and knowledgeable broker knows more about the marketplace and the surrounding area, including finding a value add (finding additional value for the investor).
Case Study: Building Good Relationships at Capital Rivers Commercial in Sacramento
Recently a prospect came to Capital Rivers Commercial in Sacramento after purchasing a new property. The client needed property management as well as help leasing the new space. The previous brokers had passed on these requests because of the client’s reluctance to pay a commission. Bottom line – he didn’t want to pay for both services. After a couple initial conversations, which were all positive, Capital Rivers decided to take the client on. Capital Rivers found a new tenant for his property, which resulted in him becoming a CRE property management client. After Capital Rivers moved the new tenant in, the owner asked Capital Rivers to help him find a bigger second property.
At Capital Rivers, we love discussing commercial real estate, especially when it comes to Sacramento. If you are interested in learning more, sign up for our email blast or contact us.