Self-Made Success

In the commercial real estate world, bigger isn't always better. Many commercial real estate professionals have found success by staying independent despite a recent trend toward business mergers and affiliation.

Contrary to popular belief, independent brokers don't necessarily have to sleep at the office to make ends meet. Commercial Investment Real Estate recently asked three successful CCIM solo practitioners how they manage to satisfy all of their clients' needs and still make it home in time for dinner. Although the benefits of working for a large company are ever present, independence offers freedom in both their business and personal lives that these brokers can't resist.

John “Dede” Malmo Jr., CCIM
As owner of Malmo Memphis Real Estate in Memphis, Tenn., and a member of the Alliance of Tenant Representatives, John “Dede” Malmo Jr., CCIM, exclusively represents tenants and buyers in Tennessee, Arkansas, and Mississippi. Although competition in Memphis is tough, Malmo believes his specialization sets him apart from the large companies.

Why did you choose this specialization? I saw a niche in the Memphis market that I felt could be developed and marketed. It is hard for an independent broker or firm to compete with the larger, national firms in the service end of our business and because of that I felt the one area that I could build a brand was in tenant representation. The Memphis market is not large enough to have to specialize in one particular sector. I specialize in tenant representation and represent clients in all phases of our industry from retail to office to industrial to land acquisition.

How do you think being a solo practitioner helps you compete?

I think being a solo practitioner actually benefits me in the tenant rep business. Clients don't hire firms to represent them, they hire individuals. They hire individuals who have a feverish loyalty to taking care of the client and making sure they are treated fairly in the lease process. My clients know that the buck stops with me. The person that they are always dealing with at my firm is the person who owns the company and is responsible for every phase of their assignment. That is a definite selling tool.

How did you get started in the commercial real estate industry?

When I graduated from Vanderbilt University in 1989 I went to work for Browning Ferris Industries in the recycling division. After three months I was laid off because recycling wasn't as profitable as everyone thought it would be. I remembered a book that I had read, The Art of the Deal by Donald Trump, and how it had peaked my interest in the commercial real estate business. At that time I went to numerous real estate professionals in Memphis and asked for 30 minutes of their time to learn about their business and their specific jobs. I met with developers, brokers, managers, and even one guy in the Holiday Inn real estate department. Eventually one of them arranged an interview with a Memphis real estate firm and I landed a leasing job with that firm.

What prompted you to go solo and why have you stayed solo?

After being in the business for almost nine years and having worked for three different firms, I felt the only way to create a niche in Memphis was to go out on my own and build a brand. I created my own firm in December of 1999 and have enjoyed the independence that I have to chart my own course and pursue the business that I want to pursue.

You have written a tenant's guide to leasing commercial space. What inspired you to do this?

The “Tenant's 10-Point Guide to Commercial Leasing” was written to help educate commercial space users on some of the simple fundamentals of leasing. I used it to market my business by mailing 10,000 copies to businesses and individuals in Memphis every month for 10 months. The response was wonderful, and it helped give me exposure to decision makers that no other form of advertising or marketing could have achieved.

Your business requires some travel. How do you run your company while on the road?

Technology has allowed every real estate professional to become less market dependent and I am no different. I am wired to my office through my laptop and I have access to all my files and databases — regardless of where I am. Operating the business while on the road is no more difficult than it would be if I were in the office. Also, as the Memphis partner of the Alliance of Tenant Representatives, I have exclusive tenant representation partners in over 30 markets across the United States, Canada, and Mexico that can assist me with assignments in other cities and help make my time away from the office more effective.

How do you think being an independent broker and company owner has helped your career and your life in general?

There is a level of satisfaction that I have now as a company owner that I might not ever have achieved working for a larger firm or being part of a brokerage team. Every piece of business that you get as an independent broker is a direct result of someone else's confidence in you and your abilities, and there is nothing more rewarding than that. Owning this business has helped me become focused and detail oriented. I have a passion for making sure my clients are treated fairly. That passion translates into business for the firm because every client and prospect knows that if they hire the company they are hiring me. If you are the company owner and you are the only employee of the company — there are no excuses.

Elizabeth C. Belenchia, CCIM, SIOR
After careers as a registered nurse and residential real estate agent, Elizabeth C. Belenchia, CCIM, SIOR, started a commercial real estate company, Carroll Properties Corp. in Spartanburg, S.C., specializing in international corporate real estate and industrial investment. Although she has researched affiliation opportunities, Belenchia remains independent because of the flexibility it offers, both in her business and as the mother of four children. It also allows her the freedom to participate in international expeditions, such as the People to People Real Estate Mission to the People's Republic of China.

Why did you choose international corporate real estate?

My thought processes have always been global. I was attracted to Spartanburg because of its international influence, and I developed a thorough knowledge of my local market and how to research any market. Corporate finance has always been an area of strength. In recent years, my company has added telecommunication research as well as targeted marketing and global environmental sensitivities to its total information arbitrage package.

How do you think being independent assists or hinders you in the international real estate arena?

My independence allows me to be very flexible and adaptable to the dynamics of each transaction. It also allows me to direct my marketing efforts toward my areas of interest rather than serving all clients with revenue as a basis for growth.

Your business takes you all over the world. How do you keep in touch with clients when you are in foreign countries?

Communication with clients and a holistic approach to their needs keeps me interested in their projects. While traveling, my office responds to routine issues, and I can be reached by fax and e-mail, which I answer in hotel business centers or libraries throughout the world.

How do you think your travels have enhanced your career and what you can offer clients?

Traveling enhances my career because it feeds my passion. People can tell when you are excited about doing business with them, and it is difficult to hide sincerity. Travel has made me a peer with my clients rather than being a local broker.

You were the first female to attain both the CCIM and the SIOR designations. How do you feel association membership and continuing education help independent brokers compete?

The designations provided credibility and confidence for me with national and international prospects. The variety of projects I have taken on requires not only continuing education, but communication with national colleagues having expertise in specific areas. I also have found designees to be more willing to share information.

My early assignments came through referrals from designees throughout the country. And continuing education and conventions provide a format for personal and professional development. I have been appointed to National Association of Realtors committees as a direct result of conducting roundtable discussions at conventions.

Additionally, local universities have sought my counsel on international issues. I was a recent delegate to the Southeast United States/Japan meetings. I serve on the South Carolina Jobs Economic Development Authority Board and its private arm, Business Carolina.

What is your philosophy of business? Are you trying to make a lot of money or lead a balanced life?

My business philosophy parallels my life philosophy. The purpose of knowledge is action, and attitude is reality.

I am trying to make a lot of money, because I have learned you are not entitled to an opinion unless you have a solid liquid financial position. In other words, “If you're so smart, why aren't you rich?” However, I am greedy about balance and strive to integrate all those success factors. Service to family, community, students, and special projects provide personal rewards beyond money. Most projects, however, require sufficient money to participate.

How do you think being an independent broker and company owner has helped your career and your life in general?

I became independent by default. No one locally would allow a woman to practice commercial real estate, so I opened my own office on July 4, 1976, and remain independent today. I was able to forge my own style and procedures to offer the highest quality of service to clients. I spent eight years as a single mother with four children on commission. I was able to attend soccer games, school conferences, and provide an enhanced quality of life for my children because of the professional career I chose. I love the business, and now as an empty nester can spend more time traveling and working — but now it is truly from desire. I have attended the International Property Market in Cannes, France, and have been a delegate to the International Real Estate Federation's winter meetings in Monte Carlo, France. While there I always make a point of visiting a local Rotary Club and see what the club does for fund raising and service. Dining in local restaurants helps me assimilate the culture. This keeps me interested in life, business, and the variety of people I am privileged to meet.

Benedict J. Frederick III, CCIM
The Frederick family has been a leader in the Baltimore commercial real estate industry since 1916. Benedict J. Frederick III, CCIM, began his career working for, and then running, the family company, yet he sold it three years ago and started Ben Frederick Realty. He specializes in brokering small to mid-size multifamily properties and investment real estate. Affiliation would diminish the value of the well-recognized family name, so Frederick has never seriously considered joining a large company.

You started out working for your family's commercial real estate company. What prompted you to go solo and why have you stayed solo?

Running my family's company — I ran brokerage, property management, and eventually was named president of the company — took a lot of time away from doing real estate work. I got too involved in the day-to-day operations and spent less time with clients making deals.

The solo model is so pure. My father raised me and trained me to always act in the best interest of the client. I saw how this principle worked well for him and learned of the benefits of following it for myself. I felt that joining another company would compromise this principle. I do not have to worry about pleasing some manager or toeing the company line. I only have to worry about pleasing my clients and my wife.

What is your marketing philosophy and how do you accomplish it?

My philosophy is to provide the prospective buyer with enough information so that they can make an intelligent decision to purchase a property.

I do everything I can to keep my name before my client base. I send a calendar to my clients around Thanksgiving. I send postcards every six to eight weeks either advertising something currently for sale or something that I recently sold. I put my sign up whenever I can. A sold sign is my best advertisement for effective real estate work.

My Web site is a big part of my marketing strategy. My Web address is in every ad and on every sign. The Web site has detailed information on my property offerings. If someone asks about a property, I offer to mail or fax them information or suggest that they look it up on my Web site. This helps me be more productive and provide a better service to the customers by getting them the information that they want and need quickly and without a lot of hassle.

Your next-door neighbor occasionally helps you out. How did this get started, what does she do, and how do you compensate her?

We were just talking one day and she said she used to work in a real estate office. She has two kids, and she does not want to work outside the home, so I asked her if she would help me.

She does property research, which involves looking up tax records, verifying utility expenses, calling the zoning office to verify zoning, etc. I order postcards and give her the labels and she mails them out. When a contract is signed, I give her the contract and she makes copies and mails them to the buyer, the seller, the lender, and the title company. She also copies and delivers the pertinent documents such as the leases and environmental reports.

She bills me for time and material once a month as an independent contractor. Her fee is a reasonable cost to me and a good source of extra income for her — without being tied to a set schedule.

What are the advantages and disadvantages of working out of a home office?

By having a home office, everything is in one place. My kids are teenagers, and working at home allows me to monitor their comings and goings.

The disadvantage is not having a conference room in which to conduct business meetings. Mostly I meet people in coffee shops and restaurants or at the property. Lately, I have taken to having clients meet me at my home, and we sit in the living room and conduct business. I use a laptop computer with a wireless network so I can generate and print documents. Most of my clients are entrepreneurial, as is typical of the apartment investment business, so they do not seem to mind conducting business in my living room and actually seem to enjoy the more casual atmosphere, including getting to meet and interact with my kids.

How do you think being an independent broker and company owner has helped your career and your life in general?

I have never been happier in my life. I love what I do. I am in control of my time and my life. I love being around my kids. I love real estate and working with clients. I like not having to worry about making payroll or whether the secretary or bookkeeper showed up. I like being independent. I like being able to use all of the skills and experiences I have had and working with clients to help them achieve their goals. My clients appreciate the experience and perspective I bring and they keep coming back to me.

What is not to like?

Gretchen Pienta

William T. Adams, CCIM, CRB, is owner of Adams Realtors in Atlanta. Contact him at 404.688.1222 or Pienta is associate editor of Commercial Investment Real Estate.


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