Being a commercial real estate broker to today’s leaders in the twenty-first century is one of the most important roles in business. – John Culbertson, CCIM, CRE, SIOR
Around the world, the commercial real estate industry is facing unprecedented challenges around regulating lenders and preventing them from causing harm. But precious little has been said about the vital role commercial real estate brokers play in supporting the sanity, happiness and prosperity of the clients they serve.
Cardinal Partners wants to remind leaders and broker-friends of the firm of the crucial value that brokers create and provide a clear blueprint for going forward.
For nearly 30 years, I’ve been a practitioner in the commercial real estate industry. I’ve been involved in everything from selling a Coliseum to relocating a Japanese chemical headquarters, from developing warehouses at the end of a runway at JFK to helping a widower literally “sell the farm.” My clients currently range from expanding multinational conglomerates to small churches trying to keep the lights on.
As diverse as they all are, they all have one thing in common: they need a straight-shooting advocate with real estate experience.
Regular readers of this blog know that I routinely call out the commercial real estate brokerage industry. In my last two blogs, I addressed the misalignment of interests between brokers and their clients, providing examples where leaders hiring brokers should be careful, and quotes from leaders saying such things as “you can put all the honest brokers in the US on the tip of a needle!”
Recently, a leader in the brokerage industry who’s quietly been reading Cardinal Insights for years responded to me, saying, “Sure, there are some bad actors out there, but you owe an apology to the professionals who are doing a terrific job.” I take that as a challenge to defend the industry.
My simple thesis laid out in this blog is that commerce and employee satisfaction are tied explicitly to the performance of commercial real estate brokers—and their clients benefit from working with a trustworthy broker in many ways.
I have laid out seven examples of “The Good that Brokers Do” to make my case:
- Brokers provide long-term, practical real estate guidance in a world where change is accelerating and the future is uncertain.
- Brokers provide a solid plan for acquiring or disposing of real estate that affects a company’s bottom line in ways few other decisions do.
- Brokers provide leaders with customized knowledge and wisdom in a world of overwhelming and confusing real estate information.
- Brokers serve as a single personal lynchpin holding together the diverse range of commercial real estate experts involved in a transaction.
- To those outside the commercial real estate industry, brokers provide a series of shortcuts and time-savers that are impossible for outsiders to understand or to implement.
- Brokers provide a clear framework for decision-making on real estate assets that will impact employees’ lives for decades to come.
- The best brokers leverage superior industry tools and systems that will multiply the results that the intended real estate decision is intended to achieve.
Now, let me say that I am accustomed to having my broker buddies take issue with me from time to time. They ask things like, “Why are you picking a fight with the entire industry?” Usually, I explain that this is simply marketing and… by the way… it’s true! And everyone knows it. And if you think that your clients aren’t aware of it, you are out of your mind. I tell them that we get paid hourly and that our clients love it—and they scratch their heads.
I’d be remiss if I didn’t offer some solutions to the problems I pointed out above:
- Get some skin in the game. At Cardinal, we ask vision-setting questions at the beginning of new assignments, then align our income to those outcomes.
- Use processes and checklists. Cardinal delivers our clients a higher level of confidence in their decisions in part due to the checklists we use. These processes, such as The Prepared to Win-Win Negotiation Worksheet™, are appreciated enough by our clients that they very often print and use them in their negotiations.
- Give pure advice. Talk to the client early in the process about how you’re compensated, how you can be protected for the time you are investing, and how the client can be assured that you aren’t in it only for the hope of a quick buck.
These uber-brokers love the game of real estate, and they play to win.
They have incredible amounts of energy, and they love their clients. There’s no doubt that you are better off with one of these brokers than going it alone.
At Cardinal Partners, we have one goal in everything that we do as consultants and brokers: Give “pure” commercial real estate advice. Sometimes that means we say “perhaps we should walk on this deal”, or “let’s bring in someone who is an expert on this.”
If you are interested in learning more about our approach, email firstname.lastname@example.org.
And here’s a shameless plug for Cardinal Consulting Services:
Many of the most efficient organizations choose not to hire in-house real estate managers. Instead, they engage an advisor such as Cardinal and focus on their core missions. Click here to see how we can turn complexity into clarity for you.