A Step-by-Step Guide for Creating a Commercial Real Estate Marketing Plan
There are many moving parts to consider for an effective commercial real estate marketing plan. In such a quickly evolving industry, it can be tough to stay organized and keep your priorities clear. The following system can be used on a rolling basis to identify properties, reach out to contacts, and close deals. Ideally, an agent will always be in one of these stages as part of their workflow. Over time, this system will become second nature, creating more ease and flow in your workspace.
Decide on a Property Type
Whether you’re looking to generate rental income or capital gain, there are several types of commercial properties from which to choose. This will depend on your level of experience, skill set, and specific goals with the property. Industrial buildings, hotels, office space, retail space, storage space, and multi-family units are just some of the routes you can take. Within each of these categories lies plenty of variation. Every type of property also holds unique risk, so assess these thoroughly before going all in.
If you’re looking to rent, consider whether you prefer long-term or short-term leases. Office space typically fills up more slowly than multi-family units, but leases are often longer. For multi-family units, the quality of the local job market, the size of the building, and whether it’s urban or suburban will determine the level of risk, time of occupancy, etc. In retail and office spaces, the health of each tenant matters, along with changes in the economy, which can impact how much the property earns. Industrial buildings are subject to unique patterns as well, like import and export changes.
If you’re an agent without a lot of experience, you’ll want to seek out properties that allow you to partner with a more experienced broker – one whose expertise lies in that type of property. This will protect you from what you don’t know, while giving you the chance to learn new things. In this scenario, you can provide leads, handle the deal, and give your partner a percentage in exchange for their knowledge.
Decide on a Territory
An idea popularized in macroeconomics is the velocity of money – the speed at which money moves through an economy. In regards to real estate, its useful to determine which neighborhoods have the highest velocity in your area of interest. This is the total number of properties sold compared to the total number of properties. The better the ratio, the better the market for making a commercial real estate purchase. Ideally, there will be at least 2,000 properties in the territory you select.
Also useful at this stage is data on the past, present, and future of your territory: What was it like 15 years ago compared to now? What is it projected to be like in another 15 years?
You’ll also want to get accustomed to pricing in different territories to assess what is appropriate for you. Each territory has its norms and fluctuations for commercial real estate. If you’re finding it overwhelming to narrow down a territory, or if you’re interested in several areas of a big city, create sections and tackle one at a time. If you’re working with an investor, they may have preferences for certain hot spots in your city.
Working with various property types in unfamiliar territories can become laborious, especially for newer agents. If working within a large territory, separate properties into relevant groups of 50 or 100. If you can narrow your focus even more to just a few streets in an area, even better. Once you are zoned in on a target territory, dive in. The last thing an agent wants is to just skim the surface and miss a great deal. Not getting acquainted with property owners can mean major missed opportunities.
Build a List of Every Property Owner
The most difficult part of creating a commercial real estate marketing plan is the gray area – the glaring obstacle of not having the information you need. You as the agent don’t know who is selling, what the name of the company is, or how to get in touch. It can feel like you’ve hit a brick wall at this step, and many agents often do.
You can’t simply do a quick search and locate the exact contact information for every property that interests you. Most commercial real estate owners don’t own their properties personally, but through companies such as LLCs or LPs. Furthermore, public records don’t offer phone numbers or emails for most property owners. And on top of all this, most property owners aren’t even open to selling. That leaves you to weed out the select few that are selling and dig up contact information without knowing a thing about them. It can be a time-consuming process that yields dismal results.
ProspectNow solves this problem for commercial agents by doing the heavy lifting. ProspectNow uses predictive analytics to identify the commercial properties that are most likely to sell. This cuts out the uncertainty and tedium typically present in this step.
Create a Call Script
Creating an effective call script is an art form – something that warrants its own separate blog post. But for now, let’s review the basics of creating a solid script that you can use again and again to build relationships with property owners.
You don’t want to waste mental energy rethinking what you’ll say each time you get on the phone with a prospect. A call script is a must-have because makes your calls uniform and efficient. In addition, it allows you to practice the same routine so that eventually, you won’t need a script.
Rehearse and be original. Don’t simply follow the rules of what you believe you have to say – People will find it easier to say ‘no thanks’ and dismiss your offer. Instead, come in fresh with the mutual benefit of your offer being obvious up front.
There should be a logical progression in your call script from greeting to ask (clearly asking what you want, whether it’s a phone conversation with a specific person, a face-to-face meeting, listing info, etc). Without this logical progression your calls with feel scattered and unfocused.
Empathize. People are immediately put off by robotic sales calls. Be a human. Be interested in their issues with the property or the deal rather than trying to sweep past them. You want to construct your call script in a way that offers a solution – Not in a way that asks a favor from the prospect. You are not calling to get something, but to give something. If you are prepared, confident, and genuinely enthusiastic about your offering, your call script will practically read itself.
Set a Goal: 1 Listing Per Month
To execute a goal of 1 listing per month, expect to get on 50 or more cold calls per day, about 2 meetings per day, and 3-5 listing presentations per week.
Generating leads is a huge part of this process and ensures the longevity of any real estate operation. In this sense, it’s important to become less rigid about the process of finding leads, cold calling, and making offers. Accepting it as part of the process without making any individual call mean anything is key. Getting used to objections and being shot down will only help you navigate the process more fluidly so you can move straight toward deals that are fitting.
Connect with as many prospects as you can and keep the relationship going. Get in touch in a friendly way periodically to stay top-of-mind. It’s also important to keep track of your contacts diligently – You don’t want a sloppy database full of names you don’t recognize. You won’t close a deal with each person in your database, but each person has an entire network of their own that can lead you to more opportunities down the line.
Double Your Listings
Once you have a decent list built, you can start generating more listings from the ones you already have. For each contact, start searching and marketing to all similar building owners you can find. To do this at the right times, it’s useful to pay attention to commercial property cycles. It’s likely that your specific location has its own patterns in when property owners buy and sell the most. Doing some research through property records can give you an indicator of when these cycles begin and end. Based on how long a property has been owned, you can also predict when property owners will be most interested in selling. Use this information to guide how and when you contact prospects. In listing presentations, you can use your ProspectNow data to show just how committed you are and how extensive your network is.
In the end, it’s about building relationships in the surrounding community. Getting to know the property owners, the nuances of your territory, and the communities that surround the property type you’re after will pay off in the long run.
So the marketing system is: Choose a property type, choose a territory, build a prospect list, create a call script, aim for one listing per month, and keep growing your listings. Once a deal is closed, repeat this system until you master it.
And finally, the step you’ve been waiting for – Cash those checks!