It may sound harsh but 90% or more of residential agents should be referring out all commercial clients to a commercial broker. This has nothing to do with being capable or a willingness to learn, but more so the basic understanding of being of service to their clients. There are very few similarities between selling a house to someone and leasing an office to someone and to spend your time retooling or fumbling through the process is frustrating for everyone involved. This isn’t to say that many residential agents do not do a good job of crossing over but they have spent time learning and becoming of value to their clients, not just figuring it out on the fly. So I have 3 reasons residential agents should refer out their commercial clients and hopefully they give agents a way to put their clients needs first.
- You don’t speak the language and don’t know what you are talking about. This is not a “you are dumber than me” statement. It is just pointing out that the terminology is different and the amount of time lost through confusing questions and googling CAM vs letting a true CRE practitioner handle the deal could probably generate a new lead to sell a house. You having to ask what NNN is or how to find the zoning and taxes is what a commercial broker brings to the table for their clients just like a residential agent knows countertops and flooring. I don’t act like I know who builds the best house and Realtors should not act like they know how things work in commercial with their clients. Another good example is the language in an LOI or commercial purchase agreement is totally different then the language in the residential one. Are you really taking the time to understand line by line what it means or do we just hope and pray nobody asks any questions? It’s unfair to show up with your clients and not know how to talk the language in CRE just as it is in any profession.
- The CRE schedule is different then the RES schedule. One of the reasons I don’t sell residential real estate is I don’t like to do showings at night or on weekends. I have lots of other work to do and being on call for a random residential agent showing is annoying. I strategically leave my nights and weekends as no showing times for my clients but nearly every weekend I end up with constant texts and calls about a property or can’t figure out the lockbox or “what other properties do you have”. I became so much more productive as a salesperson and broker when I started setting a schedule and all that goes away when a residential agent starts showing my listings over the weekend. I bet I get 1 out of 50 showing requests at night or on a weekend from a CRE broker and its for a reason. We choose to not work on nights and weekends, so stop making us work on nights and weekends. Many times I will not respond until the next business day And yes our clients are perfectly happy with this because they do to.
- Realtors have never learned passive income. So passive income exists when you make money without spending any time or energy on it. What if a residential agent learned that referring a CRE client to a CRE broker meant passive income for life. I have agents that send me all of their leads and spend a few minutes drafting an email to get that done. They make a referral fee and have literrally zero time into it. I sure could go work on the prep line at one of my restaurants but I would much rather pay the majority of my profits to others to do the work for me. So while a CRE broker is showing your clients space and drafting the proper documents you can just wait for the check to arrive and focus on your primary business.
I understand commercial real estate is no science and really anyone is capable of it but the same goes for many professions or tasks that we don’t do on a daily basis. So instead of spending time learning the language, bugging brokers on their days off and not focusing on your primary business have a look at a good referral partner. Just like you have an inspector and a lender and an appraiser and a title company, you should also have a CRE broker that can do what is best for your clients. They will make you look really good and pay you handsomely for it.