Commercial and Retail Real Estate Agent Prospecting Model

The success of your commercial real estate office and you individually as a commercial real estate salesperson will have a lot to do with your prospecting plan.  The prospecting plan is a particular process that is developed by each salesperson relative to their property type and local area.  If you want to be successful in this industry, it is very wise to establish your plan as early as possible in your career.

It is notable that most salespeople in the industry are of an ordinary performance level.  This then leaves a significant opportunity wide open for those that can move to the top of their industry through established prospecting activities and professional skills.

So let’s look at some prospecting rules that will help you build your market share.

  1. Clearly define the type of property that you are to specialize on.  That property type should be comprehensively incorporated into all of your marketing efforts.  When you work exclusively on a particular property type, it is easy to be seen as the local property expert.  You will also achieve higher quality listings over time because of this relevant and comprehensive knowledge.
  2. It should be said that your specialist property type should be in significant abundance throughout your territory.  You need to know that the property type churn will produce necessary sales and leasing opportunity as the case may be.
  3. Review the history of your area for property changeover and property leasing activity.  How much commission has been generated by your territory over the last 12 months?  How many sales have occurred in your area over the last 12 months?  How much leasing activity has occurred in your area over the last 12 months?  All of these questions should be answered so that you have a clear future in your property type and sales territory.
  4. Get to know your competitors and the listings.  You will soon understand the difference between top agents and everyone else.  When you have identified the top agents, study their business activities and their points of difference.  Is there sufficient room for you in the same market with similar points of difference?  Should you develop alternative points of difference, or work on different property types?
  5. Commercial real estate is an industry where personal branding is a significant part of your listing generation and commission opportunity.  You will need to have a significant personal marketing plan implemented on a daily basis to encourage new clients towards you.  That is the best way to attract property opportunity.
  6. Whilst you may work for a prominent local or regional commercial real estate agency, you will be the reason for any listing to be converted to a transaction.  The industry is based on people and the knowledge and skills behind those people.  Whilst your agency may attract some enquiry to you, it is your personal skills and knowledge that will convert the listing and drive the enquiry.  On that basis, you should optimize and grow your specialized skill at every opportunity.

Prospecting in commercial real estate is a personal process, as we have mentioned above.  When you truly understand that fact and develop the prospecting systems around you, the property market will open up for you in opportunity.  This opportunity is always available in any economy and in any location.

The top agents of the industry are always prospecting for new clients and new opportunity.  Your existing database and client list will eventually become tired and restrictive when it comes to commission opportunity.  Always be on the lookout for new people and new properties.  That’s what prospecting is all about.  Over time you can build a significant commercial real estate business with fresh people in your prospecting model.

Leasing Tips and Handover Strategies

When it comes to leasing a commercial or retail property, you will find that there are special things that should happen to keep control of the transaction and the final stages of property handover.  Eagerness produces errors and omissions from a leasing perspective.

The simple fact of the matter is that control helps us get the parties to the lease ‘across the line’.  For that very reason it pays to have a checklist approach to the leasing process and property handover.

When you get a lease negotiation underway, so many things can come into the transaction and divert the discussions and agreements.  Very commonly in the involvement of solicitors on behalf of the parties to the lease you will see that slow-down process start.

You are working for the client and they want a timely lease that is correctly executed and implemented. Always stay with the negotiation and the lease momentum to the very end.  If a solicitor has the papers on behalf of a client, chase-up the situation and see where things can go next.

Here is a checklist for the leasing of premises; it features some of the main things that are really important in leasing and a timely outcome.  You can add to the list based on your property type, and location.

  1. The correct lease documents should be prepared with accurate regard for the facts from the original lease negotiation.  Ensure that the client’s solicitor understands all of the facts and the unique elements of the property.
  2. Some lease documents are just part of the required paperwork for the lease occupancy.  At times there are other papers such as fit out agreements, disclosures, licences, and side agreements.  All of these should be correctly signed and in the order that is relative to local property laws and leasing situations.
  3. Any incentive agreements between the parties should be correctly documented and signed.
  4. Any plans and drawings that are part of the leasing agreement should be sourced and available for approvals.
  5. Any consultant reports relating to the transaction should be sourced.  Typically they are mechanical, electrical, structural, and base building.
  6. The permitted use for the premises should be clearly set and agreed between the parties.  That use will have impact on the design of the premises.
  7. Landlord approvals may be required before any building approvals are sought from the building and construction board or office.
  8. All monies to be paid under the lease should be taken at the time of handing over of all lease documents from the tenant.  Those monies should include bonds, guarantees, fit out contributions, and any other important financial commitments from the lease document.
  9. Do not under any circumstances hand over the keys to the premises until the landlord and their legal advisor have indicated that all papers and monies are correct and in order with both parties.  Importantly those documents should be signed by both parties.
  10. Document the condition of the premises before the tenant takes over.  This will be an important fact of record when it comes to the end of the lease.

When you create a lease handover checklist, you can keep the transaction on track to finality.  That then means a happy client and a good commission.

Retail and Commercial Property Leasing Agents – Finding Tenants for Your Property Listings

man shopping in a fruit shop in a shopping centre
The right tenants will boost your tenancy mix and lease profile for the property. Choose the right tenants in your business plan for the property.

A commercial real estate agency wants to dominate the market and create a solid market share.  Whilst this is a worthwhile goal, it is also a challenge to achieve.  There are many variables that will have a direct impact on the performance of the agency.

Some of the most frustrating aspects of managing and running a commercial real estate agency today relate to the skills of the salespeople.  Finding salespeople to work within the business is one thing; finding great salespeople is really hard.

Some salespeople will seek to improve their business performance and drive better market share.  Over time their income and listing profile will rise.  Finding the right salespeople with this mindset can always be a challenge; the top agents of the commercial real estate world are diligent and driven.  They know how to drive market share.  They are prepared to call landlords, tenants, property owners, and business proprietors.

Here are some tips to help you build your market share as an agency or as a salesperson.

  1. The traditional signboard placed on property listings for sale or for lease is perhaps one of the most important marketing tools that you can use.  It is cheap and it is a very effective visual marketing tool seen by all of the property owners and business proprietors in the local area.  Invariably, the top agents will have a strong signboard presence in the local area.  As a priority, seek to get signboards on all of your listings as quickly as possible.  When you place a signboard on a property, directly market their property into the local area personally.  That means calling in on property owners and business proprietors to talk about the new listing.  That simple activity will increase your market intelligence significantly.
  2. The best listings to work on are exclusive listings.  So often I hear agents say that they cannot achieve or attract exclusive listings.  Top agents convert exclusive listings more than open listings; they do this because they are good at pitching and presenting their services.  They are also well known through the local area as experts at what they do.  Exclusive listings give you control of your market and the client; in this way you can achieve a better result over time.  If you cannot easily convert exclusive listings, look to improving your knowledge and relevance to the clients that you act for.  Seek to specialise, as this will help you build your exclusive listing profile.  Practice your skills in presentations and pitching.
  3. The Internet is well established as a critical component of commercial and retail property marketing.  Most generic agents simply list a property and place it on the Internet hoping that the Internet profile and exposure will generate enquiry.  There are many more things that you can do with the Internet to improve your listing performance, enquiry rate, and personal profile.  Social media, article marketing, and blogging are very relevant and are highly effective tools when it comes to commercial real estate marketing.
  4. The database that an agent utilizes will be the foundation of future business.  Each agent or salesperson should be working with at least 600 prospects in the local area.  The only way you can manage and work with such a large number of prospects is through an effective and up to date database.  Managing the database should be a personal strategy and process that you undertake at the end of each day.  Don’t to delegate the process to some administrative person in your office; failure to take ownership of your database will destroy your market share.
  5. Cold call prospecting should be first on your agenda each working day.  Contacting at least 20 to 25 new people at the start of every working day will help you improve market share radically and quickly.  The other half of your prospecting process can be with people that you have made contact with previously.  Balance your prospecting equally between new people and established prospects.

The secret to building market share as a good commercial real estate agent is in the systems and the consistency that you establish.  Random actions produce random results.  Develop your system including some of these critical items above.

If you want to get some more tips on how to find tenants to fill your vacancies in your properties, you can get them in our Newsletter.

Finding More Retail Tenants for Your Tenant Mix

girl shopping for CDs and music
Choose the best tenants for your tenant mix by checking out the competing properties and tenants.

When you manage or lease retail property or premises within a shopping centre, it can always be a challenge to find the right type of tenants for the vacancies as they arise.  It is important to stay ahead of your vacancy problems and challenges within the tenancy mix.

If a tenant is nearing the end of their lease, it is simply a matter of them vacating the premises or a new lease being created.  If you work 12 months out from the event, you can plan whatever steps are necessary to resolve the vacancy quickly and effectively.

Here are some tips to help you with finding tenants to lease retail property:

  • Monitor the activities of other shopping centres nearby.  They will have some tenants looking to move or change premises for a variety of reasons.
  • Keep in contact with all the franchise groups through the region and nationally.  They may be looking for new premises for another franchise tenant location.  That being said, you will need to understand the lease requirements and lease documentation standards that apply to each franchise group.  It is likely that the lease documentation will be different to that which the landlord would normally use.
  • Create a retail leasing property update newsletter.  This newsletter can be circulated through the retail business community in your local area.  In the newsletter you can provide tips and ideas regards leasing new premises.  Given that most businesses have Email contact, a newsletter can be based on the use of an auto responder and an Email System.
  • Maintain regular contact with all the businesses through the local area.  Have particular focus on the successful businesses with strong branding.  Give them regular property updates so they can understand the changes in rental and incentives as they apply to retail property.
  • The anchor tenant in your retail property will have a significant impact on customer visits to the property and the trade for the specialty retail tenants.  A good anchor tenant will also attract new tenants to your property.  Encourage the anchor tenant to interact with all the specialty tenants in the shopping centre.
  • A shopping centre that is well maintained and marketed to the community, will be of attraction to new tenancies.  Ensure that your property satisfies both of these issues.  Establishing a productive marketing campaign to attract more shoppers to the property through all of the trading seasons.

When it comes to leasing and managing retail premises, early lease negotiations and preparation for any new tenant vacancy, marketing, and occupancy are key strategies to adopt.  A retail property is a vibrant and yet challenging type of property investment.  Work with your tenants at the earliest possible time, and you will find good results for all concerned.

Tenant Mix Plan and Strategy for a Retail Property

man outside a basket shop
Plan the placement of your tenants in the shopping centre.

When it comes to retail property performance, the tenant mix is a critical part of the leasing strategy. Well placed and selected tenants will help you as the property manager build the customer experience for the property. The end result is a property with:

  • Low vacancy factors
  • Good levels of customer visits
  • Optimised market rental
  • Solid enquiries from the local business community for leasing

All of this means that the landlords property can perform well in the current economic climate.

Property managers and leasing managers should make the tenant mix strategy a key part of the annual business plan for the property. Some good ideas to merge into the plan would include the following:

  • Base rental levels around which new leases can be created
  • Types of rental that allow the landlord to recover a good part of the property outgoings costs
  • Standard lease strategies that set targets on lease terms, options or renewals, makegood clauses, rent review processes, rent review types, etc.
  • Strategies of tenant occupancy that support the anchor tenant in the property
  • Early renewal processes for tenants that are desireable for ongoing occupancy in the property
  • Clustering of like type tenants so you can build off the sales activity of each tenant

Tenant optimisation is a result of a great tenant mix plan and its implementation.

Landlords, tenants, and property managers are all part of the property performance package to underpin a retail property performance.

Lead Generation in Retail Property Leasing

female figures with shopping bags
Look for the right leads when it comes to new tenants in your retail property.

In retail real estate and investment property your leads for new business come from a number of sources. The more leads that you can generate and optimise, the more successful you will be in getting the best listings.

In this market, the quality of the listings and tenants is so important given that the shopping centre and shopping mall buyers and the tenants can be so selective.

When the market is saturated with owners and businesses that are struggling to keep afloat, it is the quality retail properties that you want to market. These are the ones that will generate the momentum even in difficult times. The banks are also not as reluctant to lend on the higher quality asset with established cash flow.

Does this mean that you turn your back on poor and unattractive retail real estate listings? Perhaps you should for this time given that you want results to your marketing. It’s your choice, but at the very least, be selective as to what you list and how you do it. Your time is your only resource and how you use your time is essential to generating fresh and marketable listings.

What are the Sources of Leads?

We cannot cover all the sources of commercial real estate tenant and property leads here as they are unique to your market in many respects; however it is worthwhile raising the main common ones so that you can have them covered. Importantly you must know what a lead or source of new retail real estate business looks like in its early stages, and then you must know how to convert it to fresh momentum and a deal.

There is one main rule on the topic of leads; when you see a lead, you must react to it in a professional and timely fashion before someone else does.

Leads in retail real estate are not just for the things that happen today; they can be for things that are potential deals in months or even years. The more clearly you see this, the further business you will generate for yourself.

So here is the most obvious leads generation list that you must have covered in one form or another. See how you score on these items and make sure that these foundational matters are under control.

  • Business Acquaintances locally – these are most particularly those people that you have known for some time and who are likely to cooperate as an extra set of eyes in the market place. Choose of these people with care and remain in contact with them constantly.
  • Professional Business People – in your marketplace, there are a number of categories of business people to whom you must remain connected. The highest on the list are solicitors, accountants, town planners, financiers, architects, local politicians, and engineers. All of these people have significant involvement with the retail property industry and the property owners. They will likely hear about a retail property or lease transaction before you do. In many cases these people need the assistance of a good retail real estate broker to help their clients in a variety of ways.
  • Local businesses – local businesses produce change and flux in the marketplace. As time progresses, you should constantly encourage ongoing contact with all the major businesses in your precinct. They are the ones that regularly need to buy, sell, and lease retail premises; this means all the local managers and business proprietors who are involved in property decisions and creating commerce generally in the community. Recognise that they do not normally know much about commercial real estate. You can bring them updates on rental and property prices regularly to assist them with a future property need.
  • Colleagues within your office – many real estate offices are cooperative business environments with salespeople working productively with each other. This means that they share retail property leads and opportunities in sales and leasing. Sharing part of your commission with other colleagues in your office is far better than giving the commission to another outside competitor an agent in the same region.
  • Building tenancy schedules – from time to time, you will see or obtain tenancy schedules or inventories that relate to major retail buildings and shopping centers in your area. Whilst they should be regarded as confidential documents, they will give you a wealth of opportunity if used correctly. Any lease that is to expire inside the next three years is a target for future contact. The relative tenant will need to do something to preserve the function and occupation of their business. It is surprising how many tenants leave such matters to the last minute. The ongoing contact with retail tenants of this type is highly productive. Your main focus with these people is to establish trust so that they come to you when they need you.
  • Competition agents and brokers – normally speaking, the competitor agencies in your area will cooperate on conjunction transactions with their exclusives. The retail real estate industry is relatively specialised and such cooperation is common in sales and leasing of retail property. Importantly, any conjunction arrangement involving other agent’s listings must have a completely signed and documented conjunction agreement before you proceed. Cooperate with other agents, but do so with care and professionalism.
  • Satisfied clients – your agency business, if it’s been operating for a number of years, will have a significant list of established happy clients from previous retail property and lease transactions. It pays to keep in contact with these people given that most transactions in commercial real estate happen every 4 to 10 years. The satisfied clients are going to need your services again.
  • Old campaigns – any retail real estate campaign and marketing event will have created leads and people that ‘changed their mind’. All of these people should be on your constant contact register or data base. Feeding them regular market updates is essential.
  • Other Agents old deals – as a further extension of this item above, you can also monitor the transactions of other competing agents in your area. Any transactions that occurred through other agencies over the last 4 to 10 years should be monitored for future re-activity. It is interesting to note that many real estate agents and brokers are lax when it comes to keeping in contact with others.
  • Industry publications – any newspaper or retail industry publication in your area should be reviewed daily for information involving businesses relocating, expanding, contracting, or merging. It is surprising how so many agents overlook this obvious source of listing. These publications will also frequently name the key people in a business such as the CEO, President, or CFO. In all cases these business leaders go on your contact list and get a letter on a regular basis. Note that I said a ‘letter’ and not an ‘email’. In this high tech world you want your correspondence to be seen and read; an email will not achieve this in most circumstances.
  • Other agent’s signboards –when another agent puts a signboard on a retail property, it is imperative that you contact the other adjacent and nearby owners of commercial property in that street. These people are likely to have an interest in competing with the retail property that’s just come on the market. They are also more likely to use you as a competing agent whilst the other agent’s property moves through its promotional period.
  • Financiers and bank managers – these people need property transactions for their business to survive. They are also receptive to working with professional real estate agents who understand retail real estate and act professionally. If you can supply them with the source of a new large mortgage or retail property development, they are likely to offer you the opportunity for a retail listing or a sale with their clients in the future.
  • Planning approvals – keep close to the local council or office of the planning committee in your region, as they constantly consider new planning matters. Some of these offices have minutes of planning approvals that are available for public scrutiny. Check out these minutes and follow through on the opportunities that you can see. The historic planning approvals over the last few years are also great sources of retail leads and listings.

The inventory above comprises the most obvious categories of leads and opportunities in retail shopping centre sales and leasing. You will be able to add to this as time progresses in your marketplace. Importantly make sure that you have these items well under control as the essential foundations of your business.

Attracting Tenants to Your Retail Property

man shopping for fruit
Attract the right tenants to your retail property today.

Every property is unique and special. Each property has got a mixture of negative and positive issues emanating from the design and layout. To set up a productive tenant mix you have to do the best with what the property offers design wise.

A successful property requires successful tenants, and not just tenants that pay rent. This is where tenant mix is critical. To do this you need to know:

  • Rents
  • Lease terms
  • Fitout construction rules and costs
  • Incentive alternatives
  • Option structures
  • Rent review alternatives
  • Tenant preferences

Tenants are selective in what they lease. They want the best, and in this market you have to provide it if you are a property manager or a landlord. Your property has to be the best available offering in the property market at the moment.

Consider this question. What are the top 4 reasons why someone should occupy your property as a tenant? If you do not have a solid set of answers then you have a problem.

Your property should provide something that the other properties do not have or find it difficult to offer. Your property has to be the best available. You should be a property magnet to attract the tenants. So where do you start when attracting tenants to your tenant mix?

The features of the property and the design of the property will be the base from which you consider where the tenants are going to be placed. Look at the design and consider where the customers will come from inn and around the property.

What will be the ‘ant track’ by which the customers walk and pass through the property? Any corners or turning points in the ‘ant track’ are likely to be high traffic areas and if handled correctly will be the source of higher rent. At these corners you want smaller tenants with a vibrant retail offering. The successful retail property is totally about the tenants and not much else.

Without the tenants then the property will likely fail. Look around. Details of physical features of properties should be noted so that you can build on opportunities and positive aspects of the property with potential new tenants.  All the information gained should be included on an appropriate and organised listing form and recorded as both hard copy and as part of a computerised listing package.

Ultimately you will be producing a leasing brochure and information package to present your exceptional property to potential tenants in its best aspect.  All investors and owners of commercial property have differing investment and ownership needs. This then leads to the core decisions that they will make when you locate a tenant or adjust the tenancy mix.

It could be that the client has a preference to hold the property for a short period of time and then undertake a redevelopment or expansion of the property. This will have significant impact on how you would construct the tenancy mix and lease profile for the property.

To handle these facts you interview the client and discuss the investor’s property requirements before proceeding with any part of the professional leasing and tenancy services that comes with commercial real estate. You need to match your leasing and tenancy services to their property holding needs. Your skill is in assessing the potential leasing and tenant balance of the property and then shaping the leases to support the rental income needs is essential.