Brokerage

Thinking Big

How are CCIMs in small markets and firms beating this challenging market? You’d be surprised…

How do they do it? Those brokers and sales agents who operate in small markets or who work solo or with just a partner or two? How do they survive in a market as tough as today’s?

Common thought might be that, in small markets or at small firms, you need to be a jack of all trades — and all property sectors. Not so, say many CCIMs. As counterintuitive as it may seem, knowing a lot — a whole lot — about one property type or niche can set you apart, make you the go-to CCIM for your market area. It becomes your brand, your identity.

In addition, CCIMs in small markets and at small companies are redefining themselves to not just survive, but thrive. “And the only way to thrive in a small town with limited deals is to become the best,” says Beau Beery, CCIM, CPM, vice president of commercial real estate for AMJ in Gainesville, Fla.

Being the best is what being a CCIM is all about, but the challenges of the last few years have tested even the most stalwart, successful commercial real estate professionals. “By God’s grace and my little red pin,” says Thomas F. Campenni, CCIM, CPM, a consultant in Stuart, Fla. “Because of those two factors, I am still active in the industry I love.”

Here’s a look at how other small market/small firm CCIMs have marshaled their resources to thrive in this new economy. Even the big guys might pick up a few tips.

Specialize

“To be successful in commercial brokerage you still need to be known for something,” says Beery, who is a retail and office leasing specialist. “You need to be the best at some specific niche and be known for that for your region, not just your small town.”

But a niche doesn’t have to be a property sector — it can mean focusing on a certain clientele.

“I exclusively represent families that have real estate in their investment portfolio and want to maximize those opportunities over the long haul,” Campenni says. “They often live overseas and I have cultivated that niche market. Nowhere can my clients receive the level of service that I can provide.”

“I have a reputation in my market as the go-to guy for the sale of larger apartment properties, especially when the deal requires some extra strategy or thought,” says Tim B. Thompson, CCIM, of Deerfield Commercial Real Estate in Holyoke, Mass. “The fact that I operate in a smaller marketplace works to my advantage: I am familiar with virtually every apartment property in my market and I maintain regular contact with the owners.”

Thompson’s creativity is his “value-add.” For example, on a recent sale, he agreed to accept four residential condominiums as his fee. “The condos simply were not a fit with the rest of the portfolio, but the seller insisted that everything had to go as one package,” he says. “By agreeing to accept the condos as my fee, I was able to find a solution that accomplished my goals as well as the goals of my client.”

With the market collapse a few years ago, many CCIMs lost their areas of expertise. “The days of just doing land sales or leasing are gone,” says Russell Webb, CCIM, vice president of Stream Realty Partners in Flower Mound, Texas. “But I have found a new niche that has helped set me apart. Lenders will loan money to owner-occupants on office and industrial purchases if their credit is strong. I know bankers I can connect with potential buyers and show them the advantages of owning vs. leasing. This has helped me get through the rough times since mid-2008.”

Be the Change

As Webb’s experience illustrates, adaptation is a key to survival, so a willingness to change business models is essential in a challenging market. About three years ago, Kevin P. Clay, CCIM, owner of Reign Real Estate Services in San Carlos, Calif., started transitioning out of privately financing deals to focus on commercial real estate brokerage and leasing. Still, change remains his constant companion.

“I revise and update my business model every January,” Clay says. “This year I will be running with fewer small tenants as a tenant’s rep and spending more time on working with buyers as the return is larger. I have ceased originating any private financing deals due to the incredible triage that has been required as a result of the recent financial mess.”

Wood Hughes, CCIM, ALC, a broker in Stockbridge, Ga., also changed directions, switching from land sales and commercial development to operating a franchise of Equitax, a national property tax reduction business. “I’ve been able to go back to the property owners I’ve dealt with in order to lower their costs of holding their property through this critical time.

“The Equitax franchise is a countercyclical business that allows me to keep my land and commercial investment staff busy and hire a full-time certified appraiser who can also help me with my other business. Most importantly, it gets me in front of commercial buyers and sellers in this slow market as a trusted authority. As the market returns, I should have earned the right to get their business when they start buying and selling again.”

Make Time Work for You

Hughes’ strategy of offering a new service to past clients is one method of qualifying prospects in advance, a timesaver for solo practitioners who pride themselves on superior customer service but must be very careful not to spread themselves too thin.

“Picking clients with whom I can be the most effective and narrowing my focus by listening fully has really paid off for both my clients and me,” says Paula C. Smith, CCIM, a broker associate with Osprey Real Estate Services in Clearwater, Fla. “By defining my client’s wish list and comparing it to all their options, I try to eliminate time-wasting exercises.”

While grabbing at any opportunity might seem the way to go in a difficult market, many CCIMs are researching clients and properties and choosing to work with only those that hold the most potential.

“I am more specific on what listings I pursue and take,” says Casey Weiss, CCIM, principal of Access Commercial Real Estate in St. Paul, Minn. “There are a lot of properties in today’s smaller markets that simply will not be sold or leased. Knowing when to avoid these properties as listings can save you valuable time that can be spent on more likely transactions, research, and business promotion.”

Another timesaver is devoting your time to deal making and passing on other business duties. Smith hired a local public relations firm to provide marketing services. Beery hired an additional assistant to “put together cold call lists, redo property fliers, tighten marketing packages, add elements to our Web site, and increase our presence on other listing Web sites. Those items consume too much time,” he says.

Increase Your Technology Bang

Using technology to qualify prospects also saves time.

“When I get a call from a potential buyer/lessee who is interested in a property, I direct them to my Web site as we speak,” says Skip Weber, CCIM, of NAI/Latter & Blum in New Orleans. “If the zoning is wrong, parking is insufficient, ceilings too low, they can spot this from the video and pictures and save me an hour by not showing that property to them.”

In many ways, nothing gives solo and small firms more bang for the buck than technology — as long as they keep up with it.

While social media is not new, some practitioners may not be aware of its business networking capabilities. “I use social media to reach out to CCIM designees I studied with during core courses, investigating opportunities to share referrals,” says Nancy M. Fish, CCIM, owner of Park Place Real Estate in Kalamazoo, Mich. In addition, she tracks her Web site’s searches and fine-tunes her marketing to match “what is currently on the minds of investors, buyers, sellers, landlords, and tenants.”

“I have begun doing video tours of all our vacancies and then editing them with text and music,” Beery says. “Prospects absolutely love it. Out-of-towners love it. Those I’ve already shown the space to can play the video to see certain parts of the floor plan they may have forgotten.”

“Cloud computing is a technology on which we rely heavily,” Thompson says. “It allows our sales team to collaborate on projects in real time. For example, if I am in the field and I receive an e-mail from a client with edits to a contract, my assistant has the ability to update the file from wherever he might be. I can then e-mail the edited document to my client from my phone, all within a matter of minutes.”

Adjust Your Marketing

Brokers in small markets often have a better opportunity to raise their profile because they are big fish in small ponds. While community service builds a good reputation, other approaches also are effective.

“I’ve seen a lot of positive results making myself available for local economic development councils and partnership committees,” Smith says. “These groups in smaller municipalities are light on staff and resources. Becoming a resource for them has helped me establish a foothold locally.”

Thompson markets regularly with institutional buyers at national meetings. “I attend a minimum of five national meetings a year,” he says. “I maintain regular contact with national multifamily investors and I’m always on the lookout for new buyers entering my marketplace.”

Daren W. Hebold, CCIM, associate broker with Daigle Commercial Group in Portland, Maine, has given up on mass mailings and focuses his marketing efforts on a significantly smaller pool of buyers and sellers. “Target marketing to specifically researched individuals has been most effective,” he says, adding that every six weeks he sends a polished e-newsletter of listings and price reductions to his carefully culled database. “This works well in concert with our traditional, direct phone communications or meetings with these prospects.”

This approach “helped make 2010 a very successful year for our firm,” Hebold says. “Our best deal last year was the sale of a high-quality inn at $3.55 million to a local multi-property hotel operator whom we sought out, citing that this property would make an excellent strategic acquisition.”

But don’t think for one minute that the days of mass mailing are over. Weber in New Orleans sends out his newsletter to 2,000 prospects every month. “Most people delete it. Some read it,” he says. “Every month, I get someone who simply hits ‘reply’ and tells me to contact them because they need my services. Never fails. New business.”

Sara Drummond is executive editor of Commercial Investment Real Estate.

Are You Leveraging Your CCIM Member Benefits?

CCIMs in small markets and at small firms probably know better than anyone else the value of CCIM member benefits. They use them because they work.

“I’ve paid the bills in the last couple years thanks to CCIM referrals. MailBridge also has been a savior
for me,” says Thomas F. Campenni, CCIM, CPM, a consultant in Stuart, Fla.

A marketplace of haves and wants across the country, MailBridge also is a place to pose questions and “get guidance from the best practitioners in the world,” says Beau Beery, CCIM, CPM, vice president of Commercial Real Estate for AMJ in Gainesville, Fla.

STDB is another frequently used benefit among CCIMs. “When I’m doing tenant representation for retail clients, STDB is a very valuable resource,” says Paula C. Smith, CCIM, a broker associate with Osprey Real Estate Services in Clearwater, Fla. “During the site selection process, it helps me find out what the market looks like in relation to my clients’ businesses.”

“STDB makes my marketing packages blow the competition out of the water,” Beery adds. “Other Realtors and users call me often asking for a certain report, aerial, or statistic because they know I’m one of the few that has access to the STDB platform.”

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