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4 Downsides Of Becoming A Commercial Property Agent
If you are achieving consistent success being a commercial real estate agent, you have landed in a place envied by a lot of people. Yes, you get better commissions, get corporate treatment, and have a nice sounding title among others. But there are also disadvantages, or some call them cons, that you must be aware of before heading down this career path.
The market for commercial properties is highly exposed to how the economy is performing. Unlike residential where people still need a place to live even in a downward moving economy. When businesses suffer extended losses, they could move out sooner than you think. And this could be voluntary or involuntary. If you are lucky enough to serve one of those building owners, you can also expect to be under pressure each day to fill up vacancies in as short a time as possible or face the prospect of getting fired.
Even economic setbacks regionally or globally can cause ripple effects that impact your customers. And you might also face huge challenges when things are going well. For example, a major player has entered the market due to opportunities and flood the market with cheaper commercial space that offers better value. It can be challenging enough to secure corporate clients in a small market. It will be even more challenging when you are going up against a big player that you have no links to.
Remember that when you are dealing with huge clients, you are also dealing with shrewd savvy investors who know what they want and are not afraid ruffle some feathers to achieve their goals. They have a bottom line to look out for, and that is the ultimate goal. You are often viewed as just someone who is at the right place at the right time to serve them. They are doing you a favour instead of you doing them. They can swap you for someone else in an instant. This is assuming they do not already have an in-house team with your expertise to manage these issues.
And very often, you do not even get to speak directly with the ultimate decision maker. All your communications are passed along their organisational structure till it reaches them. And a lot of communication can be distorted along the process due to political issues. The worst part is that sometimes it can take so long just to get a response so that things can move forward.
More in-depth research
You can get away with just talking about general information on the real estate market when serving a residential home buyer or seller. Brief summaries are often what is required to appease them. But for commercial clientele, many expect you to be well informed on every little information regarding a deal you are managing.
For example, a potential buyer for a warehouse building will want to know the market rental, the average rental current tenants are paying, the expected time frame to break even, government subsidies and grants related to the business, costs of insurance, and much more. You will, in all honesty, look like an idiot who is out of your league when you are unable to provide these details when a client asks for them. How can you expect them to make a decision when the data required to make one is not available. And you are supposedly the market expert who is providing a service to serve that specific need.
Saying that the market is going up is not enough. You need to provide numbers, historical data, trends, etc. Don’t be an agent who is just there to collect a cheque. Nobody said this job was easy.
Business owners don’t often have time for agents until they need the services of one. So no matter how much marketing you choose to bomb the market at any time, only those who are ready will get in touch with you. And seeing that there will be a lot of competing agents scrambling for the attention of these businesses, you can clearly see that it is a challenging task to acquire customers.
The best way to approach lead generation is to set up systems aided by the latest technology to build long term relationships. This is so that even when a business owner does not need your help now, they know who to look for when they do need to hire a commercial real estate agent. I will talk more about how to achieve that in future article contributions.