Magazine article Journal of Property Management

Profitable Partnerships: Fostering Relationships with Brokers Helps Real Estate Managers Expand Business

Magazine article Journal of Property Management

Profitable Partnerships: Fostering Relationships with Brokers Helps Real Estate Managers Expand Business

Article excerpt

Referrals from commercial real estate brokers can be an excellent catalyst for expanding your management portfolio. Oftentimes, investors form relationships with brokers long before they begin contemplating selection of a management firm. Having gained the trust of the investor, brokers can heavily influence investors' selection of management firms. A favorable recommendation from a broker can go a long way towards cementing new business. Therefore, an integral part of a management company's marketing plan should include cultivating relationships with brokers. To successfully foster such relationships, management professionals need to understand how to motivate brokers, the intricate nature of the broker-manager relationship and the methods by which such relationships can be nurtured.

[ILLUSTRATION OMITTED]

KNOW YOUR BROKER

Before you pick up the phone and start introducing yourself to brokers in your market, you must first understand how a broker will benefit from such a relationship. As most brokers' paychecks are based on sales commissions, they are motivated to close sales as well as maintain high customer satisfaction standards to increase the likelihood of repeat business. To gain their trust and confidence you must be able to demonstrate to them how you, as a property management professional, can help to enhance customer satisfaction, close sales and improve the odds for future business.

In relation to the owner/investor, you must also demonstrate an understanding of the delicate nature of the relationship that will be established between you, the broker and the investor, especially to reassure the broker that your involvement will only serve to positively enhance their potential to close sales and generate more business. Lastly, you need be sure that the broker understands your true motivation--obtaining new management business--not compensation for facilitating a sale.

CONNECT WITH CONFIDENCE

You might be asking yourself, "How can I assist the broker in closing the sale?" The answer is quite simple: by giving the investor confidence through a number of factors. For one, if you can provide local management to an out-of-state investor, that can be very appealing to both the broker and the investor.

You can also give the investor (and broker) confidence through your credibility as a professional real estate manager. It will behoove you to share your management firm's corporate history, clientele and capabilities. If you work for an ACCREDITED MANAGEMENT ORGANIZATION[R], be sure to mention that along with any other professional credentials or designations you might have.

Additionally, provided you have your clients' prior consent to do so, offer client references or a listing of properties in your portfolio to the broker. Share case studies or examples of how your management services increased clients' returns on their investments.

To connect on a personal as well as a professional level, make an appointment to take the broker out to lunch or breakfast. If you speak knowledgeably about management topics, you will alleviate any concerns the broker may have regarding your professional acumen.

BUILD RAPPORT AND TRUST

Developing a client's trust is a gradual process. You should encourage brokers to recommend your management services as early in the process as they feel comfortable doing so. This allows your management firm time to build a rapport with the client and perform due diligence on the investment properties being considered for purchase.

You should suggest that you tour any potential investment properties with the broker prior to touring with the client as part of your due diligence. This will provide ample time to assess the current physical status of the property; ascertain the extent of any deferred maintenance and identify potential capital improvements (information that is prerequisite in determining a management fee). …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.