When you work in commercial real estate sales, leasing or property management, you are in effect the solutions expert. The solutions you provide resolve common property problems such as:
- High vacancy factors
- Tenancy mix problems
- Property redundancy
- Changes to supply and demand of premises to occupy
- A shift in local demographics, customers, and business community
- Threats to rental income
- Pricing problems
- Lack of enquiry
- Extended time on market
- Unique property improvements with limited attraction
Have you got the answers? The only way you can solve these problems and the pain they create is to know the local property market extensively and intimately. You need to know how to systemise the problem and strategize the solution for the property owner, tenant, or business proprietor.
When it comes to commercial property, you are in many circumstances resolving the property pain for the landlord prospect or property owner client. That then is quite straightforward and takes into account the issues above. Develop your answers accordingly.
When however you are working with buyers or tenants, they are essentially looking for something else; that is new opportunity. In many cases that will be financial as a direct result of a finding a better property location, the better tenancy mix or profile, or more substantial and relevant property improvements.
So you are a solutions expert to different property people in different ways. When you take into account the financial priority that many of these things create or present, then you have some clear steps to the solutions process to help them. Here are some steps you can use:
- Ask relevant questions of the prospect to identify the type of property they need and the timing of the event. The advantage you have here is local property knowledge and benchmarks of activity to draw upon.
- Restate the client’s situation in your terms so they can see that you totally understand their needs and opportunities. Include in that process a summary of three or four key issues that may trouble them and be a greater priority.
- Review the alternatives available and the properties that may suit the solution required. Those properties can then be turned into physical and financial points of advantage. Ultimately that means and includes analysis of cost, income, and return; commercial property is all about return and less about emotion. The client may want to see a return on investment and a time base calculation to support that. This is where calculating Internal Rates of Return (IRR) could be part of your assistance process.
- Once the financial or physical advantage can be determined, the third component that most interests the prospect will be timing of the transaction and lifecycle of the property change. They will want to know how long it takes to solve their problem and how long it will perform satisfactorily. All of that will involve property income, property value, redevelopment opportunities, and levels of improvement. Knowing their needs is a comprehensive part of the process.
Top salespeople in commercial and retail real estate are solutions experts. They provide logical strategies to the people and players in the property industry. The more knowledge you bring to the table regards this equation, the greater your chances of being the local property expert.