I was in my early-30s when I got started in Commercial Real Estate. That was over thirty years ago! Then, as now, newer Brokers teamed up with more experienced Brokers to learn the ropes. That’s when I met Wallace McNeill.
Wallace was the first person to show me how to do the work of a Commercial Real Estate Broker, and he was the right guy to do it. He maintained a golden reputation, consistently showing himself trustworthy through every transaction.
He was also a hard-worker. I’ll never forget his advice to me: “Jake, be pleasantly aggressive.” Then he showed me what he meant by his actions. He worked hard, doing all he could to get the best deal for his client without being pushy. He wanted to leave a legacy of kindness and fairness.
Now, as someone who has had the privilege of closing over 500 retail, land investment, office, and industrial transactions, I’ve tested Wallace’s advice thoroughly and passed it on to others.
I’ve also gotten to work with a team of tremendous Brokers who have a similar code of ethics. Over and over again, I’ve watched them work to create win-win deals on behalf of their clients.
I’ve discovered what separates great Real Estate Brokers from the rest. If you’re an entrepreneur getting ready to look for Commercial Real Estate, here’s how to choose a Broker who will guide you successfully through the process.
Quality Real Estate Brokers are experts at property valuation.
No one wants to pay too much for a property, and no one wants to let a property go for too little. The decision on how to value your property will make or break the deal from the beginning, so getting it right takes experience and know-how.
There are many ways to come up with a price, but savvy Brokers leverage several of them at once.
1. Comp Searches
“Comp” is short for “comparable,” and we look at similar buildings that have sold in the same area as the building in question to figure out it’s worth. This includes mining our internal records of transactions that date back decades, as well as combing the comprehensive industry databases to which we subscribe.
However, this is not an exact science. Commercial Real Estate properties are rarely cookie-cutter, and it can be hard to find a recently sold similar property. Thankfully, this is not the only tool a Commercial Broker has to work with.
2. Collaborative Opinion of Value
Even when comp searches bring up useful results, smart Brokers will turn to their colleagues, knowing they will collectively be aware of current trends, upcoming deals, and other intelligence that will augment their ability to estimate their price.
3. Collaborative Opinion of Value, Part 2
Commercial Brokers aren’t the only people working in the industry who might have a good idea about what a property is worth.
A good Broker will often leverage his network of contractors, appraisers, and other Real Estate professionals to weigh in on the value of a property. This isn’t a one-way street, either. Experienced Brokers receive calls from appraisers as well, and together they form a pool of knowledge that, in the long run, helps clients price their property fairly.
4. An Ear to the Ground
Real Estate trends up and down, just like the stock market. The best Commercial Brokers I know are aware of what’s happening in the community they’re working in.
That’s where a local brokerage like Hilliker has a competitive edge over larger national brokerages. The people in our office are out in the community, reading the local papers, interacting with government officials, and generally aware of what’s trending in our region.
Quality Real Estate Brokers are often (though not always) part of a larger firm.
Though I’ve worked successfully with several quality brokers who are on their own or part of a smaller firm, there are few reasons larger firms have the edge over smaller firms or solo acts.
1. Formal and Informal Mentoring Relationships
As I mentioned before, newer Brokers usually pair up with veterans to learn the ropes. My colleagues have all had a “Wallace,” and I’ve served in that role for others.
More experienced brokers benefit from having newer brokers to work with as well, benefitting from their energy, their curiosity, and their partnership.
2. Established Relationships with Bankers
Banks tend to trust the opinions and work of established Brokers, or at least those who have the backing of an established firm. When choosing a Broker, you want someone whom bankers trust as an industry expert.
3. A History (As Well as a Future)
Most entrepreneurs want to establish partnerships that will last over the course of their career.
I’ve helped new business owners lease their first building, then buy a building, then take on tenants, then retire and rent out their old building to new businesses.
Working with a Broker at an established firm will allow you to build on your mutual successes over time. And if that broker retires, you’ll be able to continue your relationship with people who know you and your history.
4. Better Connections
As a member of a large firm, I keep my colleagues aware of what I’m working on. They do the same for me. That way, we help each other match clients with properties all of the time.
Often, one of us has a client who matches up with a property in a colleague’s portfolio (or vice-versa). Or we’ll be able to pool information we’ve gathered from our connections to help each other out.
5. A Higher Bar for New Brokers
Firms like Hilliker Corporation place high demands on their Brokers. We want to work with the best, and that means we’ve screened potential Brokers on your behalf.
Not only that, larger firms don’t often work with part-timers or people who are splitting their time between other Real Estate disciplines. We do Commercial Real Estate deals all day every day. Brokers from more substantial firms are immersed in doing what you need them to do, not in trying to juggle several other types of transactions.
Quality Real Estate Brokers will present sellers and landlords with a comprehensive marketing plan.
When you meet with a CRE Broker for the first time (and it’s good to meet with more than one), you should ask them what their marketing plan will be. Every situation will be a little different, but here are some elements to look for.
This seems like a no-brainer, but at Hilliker, signage is a big deal. If you’ve ever seen our “big red H” outside of a building, you instantly know the property has space for lease or purchase.
The visibility of the sign, as well as its branding, is an integral part of a Broker’s marketing process. He or she may also send out mailers to local businesses or go door-to-door with brochures.
2. Product Platforms
If you have a space for sale or lease, your Broker should list it on a variety of both local and national platforms. Additionally, if you’re looking to lease or buy real estate, your Broker should be culling options for you from a variety of sources. (We have our own platform here.)
Every Commercial Broker worth his or her salt will make sure as many prospects walk through your space as possible. Besides making sure interested parties get to see what’s available, that person may schedule open-houses for other brokers and business owners who will help them get the word out.
Commercial Brokers who have cultivated a network of business partners, colleagues, and contacts over the years will leverage that network on your behalf. Ask if they have any ideas whom they’ll talk with about your property. They should have an answer shortly into the process.
5. Creative Pricing and Value
If a property struggles on the market, savvy Commercial Real Estate Brokers will modify the price over time or look for other incentives to get buyers or lessees interested.
Are you looking for a Commercial Real Estate Broker? Here’s where to start.
If you’ve been in business for any length of time, you probably already have some partners who would be able to help you find a great broker. People who know quality Commercial Real Estate Brokers include:
- Other trusted business advisors
When you talk to your trusted team of advisors, ask for a few options. You’ll want to speak with more than one person before you make your final decision.
And don’t forget to call us at Hilliker Corporation.
With a built-in network of Commercial Real Estate Brokers, you’ll be able to leverage our entire team, no matter which member you choose.
John H. “Jake” Shepley has worked as a Commercial Real Estate Broker for over thirty-five years. After graduating from the University of Colorado, Boulder, Mr. Shepley earned his MBA in Finance from the University of Missouri-Columbia. Married to his wife Carol since 1986, they have three daughters. Jake is excited about life, waking up daily to seize whatever challenges lay ahead.