• Fri. Dec 9th, 2022

Think Narrow: Why Commercial Real Estate Brokers Should Specialize »RealtyBizNews: Real Estate News


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It is obvious to all of us that commercial real estate is about to change. Brokers compete not only with each other, but also with new technologies and self-service platforms. Customers aren’t just looking for partners with local or regional market knowledge, they want someone who understands the complexity of their individual needs, as well as relevant microtrends and price benchmarks. They want someone who can teach them something that they can’t learn anywhere else.

Brokers need to define their unique value propositions more precisely, and one way to do that is to become a specialist or expert in a few carefully chosen types of properties that make sense for your geography and brokerage. And unless you operate in a very small market, that means going more narrowly than the usual idea of ​​CRE specialization. You may already be focusing on offices, industry, retail, apartment buildings, net lease, etc., but it is interesting to develop expertise and market positioning in more specific niches. within these types.

These tips will help you choose the right field, gain the knowledge needed to deliver value to your prospects, and use that expertise to generate new business.

1. Identify the right specialties

Whether it’s a new concept like data storage centers, marijuana dispensaries or on-demand workspaces, or a growing vertical sector like senior housing, self catering – Storage or healthcare, brokers are well advised to specialize in the types of properties that have the greatest potential for growth in their markets.

When evaluating potential areas of interest, be sure to think long term taking into account demographic, legislative and investment trends. For example, the Affordable Care Act has had implications beyond insurance. New payment structures that encourage providers to keep patients out of hospital for as long as possible, coupled with consumers’ growing priority of convenience, have prompted many healthcare systems to decentralize their facilities and open clinics. more urgent care. Savvy commercial real estate brokers are taking advantage of this trend by finding new types of spaces that can be adapted for medical use and by presenting themselves as experts in this field.

In addition, think about your own interests and the makeup of your network and portfolio of closed activities. Analyze your database to determine the segments where you have the most connections and comps or rosters, and identify projects that have been particularly lucrative for you. When adding prospects to your database, include as much information as possible about their companies and industries. This will help you identify patterns and submarkets that are worth exploring further.

Research your competition and their areas of specialization. Try to identify under-represented submarkets. If a contingent of brokers has already accumulated years of knowledge and experience in a particular field, this may not be the best specialty to pursue.

2. Develop your expertise and your database, and put them at your service

Becoming a trusted advisor in a specialty is all about uncovering trends and ideas, then distilling them into actionable advice that helps your clients make or save money. To learn more about your area of ​​interest and stay on top of the news, attend conferences, read trade publications, subscribe to newsletters, set Google Alerts to monitor the web for relevant news, and consider requesting informal meetings with thought leaders to gain a better understanding of the market.

When it comes time to prepare a pitch or formal presentation, be sure to include the following areas:

Demography

Help your customers assess a region’s potential by providing them with relevant demographic information. This is especially important when working with retail, hospitality, multi-family, and office clients who are considering a new location. Analyze the data to determine if there is an end-user market or if there is evidence of a market forming.

Economy

Your clients will expect you to be the expert on factors like prices, rental rates, vacancy rates, and interest rates, but the key to delivering real value is sharing your expertise. information that goes beyond these numbers. Help clients draw conclusions from research, share proprietary data where possible, and use anecdotal evidence to personalize the pitch and present your experience.

Land use

You will need to show customers how a location is currently being used and how its use is changing. For example, the amount of open space in an area helps you communicate recreational space opportunities, and the mix of buildings helps you demonstrate property demographics. Likewise, the total square footage of the retail space helps you communicate the exchange of money and the possibility of leveraging it, and new developments help you define the evolution of the area. Whenever possible, convey this information visually, for example with a personalized card.

Plus, think about factors like traffic, infrastructure changes, environmental issues, zoning and zoning overlays, and tax zones. Some of these factors will help justify how attractive a potential opportunity is, but others will work against you. Be open and frank. You’re better off dealing with negatives preemptively, as this shows customers that you understand their needs and their position.

3. Introduce yourself as an expert

By identifying an area of ​​intervention, you can prospect more effectively and more specifically. If you are using a CRM, try to segment existing contacts by industry and communicate with a personalized message that highlights your experience. Make sure your social media presence and company bio reflects your specialties. Consider blogging on topics of interest to customers and prospects in your niche and offering to speak at industry events. Specialization also makes it easier to develop a paid marketing plan, as you can focus on reaching a more specific target group.

Of course, you don’t want to miss out on other business opportunities. Specialization does not have to be limiting. You can specialize in several areas, especially if you operate in a secondary or tertiary market. The goal is to develop in-depth knowledge and connections that give you an edge over other brokers.
By adding value through knowledge and data, you will set yourself apart in this increasingly crowded and competitive space. You will also approach prospecting and marketing more effectively by focusing on target areas and tailoring your approach accordingly.

About the Author: Tanner McGraw is the CEO of a Commercial Real Estate Software Provider Apto.

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