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Self Serve Commercial Real Estate. This Cannot Be Happening.

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Let’s pick up the story of Mike. In my post Is Almost Every Building In The World For Sale Or Rent  Mike was left questioning if a phone app his golfing buddy Eric had downloaded would displace the brokers value in a transaction. Eric had already made contact with the existing tenants and the building owner. He had gathered almost all of the necessary data about a building that his company was looking to purchase all from a free mobile app.

The Bigger Problem.

When asked what his answer was to the fact that his client was most likely creating a transaction without him Mike responded that he would “assist and represent” just like he always has. Big mistake by Mike. What Mike has yet to realise is that his client has already moved on to the new reality of the commercial real estate transaction.

Self Serve Commercial Real Estate.

Clients have already evaluated the building.

Clients have already evaluated the broker.

Clients have already evaluated the building owner.

Clients have already evaluated the tenants.

Clients have already evaluated the entire deal.

Clients have their own database.

Clients have always been connected to commercial real estate.

Clients have no need for face to face they don’t want face to face.

Clients have their own transaction management.

Clients have no need for white papers.

Clients have no need for consultative selling.

Clients have no need for relationship building.

Clients have already downloaded the information.

Clients have no idea what transactional means and could care less.

Clients have made your phone go quiet for a reason.

 

Clients have made commercial real estate self-service.

Self-Service Commercial Real Estate. This Cannot Be Happening.

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  • BobSchecter

    No surprise and nothing new Duke. It’s been a steady progression for years. But brokers, or at least the good ones (you know who you are) have little to fear. In fact, the better you are at your job, the more you should embrace this self-serving market, because it serves to make you shine.

    There are umpteen thousand sales people out there who call themselves commercial real estate brokers. I’ve dealt with a ton of them, and they aint – brokers that is. They’re frustrated sales people, many from the residential sector who found themselves displace when the housing market collapsed, who are diligent hustlers at best, and clerks at worst. They haven’t a clue how to help me as a developer, so all too often I’m left to fend for myself. Those are the brokers that should fear the wave of self-serve as in fact they are the ones who are pushing the agenda of self-serve.

    On the other hand, the real brokers, the ones I look for, the ones who not only know all of the “necessary data about a building that my company is looking to purchase or develop”, but understands my wants and needs from acquisition to disposition. He saves me time and money, so his value isn’t measured by his commission, but rather by his communication – he makes the deal work so I can do less work. And I find that to be more self-serving. (hey, I’m a developer – I’m still a whore)

  • Linda Martinez

    Duke’s comments are astute and a bit hair-raising, particularly since I am not at an age where I am inclined to reinvent myself. I do not come across many residential agents trying to become commercial agents, bur rather, long-time commercial agents who refuse to embrace change and new technology. Agents who say, “if it ain’t broke, don’t fix it.” Clearly, it is “broke.” Clients will (and have) simply find a way to go around us.
    Bob, thank you for responding to this post and giving us the developer’s perspective. As agents, we provide value by understanding the client’s “wants and needs from acquisition to disposition.” Listings and building data are easy to obtain but what about accurate and in-depth insight about the property and surrounding areas, applicable real estate law, tax repercussions, and so forth. We must be knowledgeable and be able to provide information about emerging neighborhoods and scenarios likely to happen in the next 5, 10 or 20 years.
    With that said, the industry is indeed changing and we have to change with it or get left behind. What CAN we do for our clients that they cannot do for themselves?

    • Howard Lee

      Transactional experience is the missing element. All the Commercial RE data available doesn’t mean one knows how to use it to successfully negotiate with a seasoned adversary. I welcome competition with an self educated user and will gladly take over to guide their way to a close. It will save me a lot of upfront research and education time spent on their behalf.

  • norm turner

    I have worked on both sides of the fence for 30 years and the key is simple bring something that the client can’t do himself, bring a client that you truly have control of, make a deal happen where there wasn’t one there before.

    If I can do what you are doing on line by going to a listing site or tracking down the corporate RE manager using Linkedin why on earth would I pay you a fee.

    No value added – No Value extracted simple equation

    • Cbowenusc@gmail.com

      not quite sure of the scenario here… but gather that you are confused. Tenants don’t pay fees 99% of the time.

  • rsky1

    It is this simple…we are here to serve those clients who are unwilling or cannot serve themselves. If they don’t perceive that we can make their life easier or bring a needed service/added value to them, then why should we get paid? I still believe listings are the key whether for sale or lease.

    • Cbowenusc@gmail.com

      Though it could be hard to prove, fundamentally we must imagine that on average, proposals for tenants submitted by brokers are better deals than those submitted directly by tenants. This is getting back to the core of any transaction, like a court case. Each side must represent their own self interest and cannot fiduciarily service both parties. They can disclose that they’re serving both sides, but that does not make both sides of the deal equivelant in terms of fairness or fiduciary responsibility observed.

  • Dave Meyer

    There’s do it your self- ers in every aspect of business today as information and data becomes more and more readily available to anyone. Understanding which data is pertinent and what it means to the party in question is and will be the key. I have had very self sufficient and highly intelligent folks get most of the way through then find out they don’t really know as much as they think they do or can’t properly interpret the data or the ramifications of it and then my phone rings. Fees follow.

    • Duke Long

      David,
      Excellent point. Tomorrows post may add some fuel to the fire.