New Broker Advice
Hi all, I will be starting as a broker as my first job out of college in a week. I will be at big 4 firm in a secondary midwest market focusing on industrial with the ability to do investment sales deals across all asset classes. I have my license and interned with the company this past summer and got my feet with prospecting, underwriting, etc. I have also read Brokers Who Dominate and read through this forum to get advice. I know this job is tough for the first couple years but I really want to hit the ground running. I'm trying to have lunch/coffee with as many top industrial brokers in the area as possible, what are the questions I should be asking? Also, can you give me industrial related tips or info that I may not have gotten over the summer? I know its more plug and play based on clearing heights, docks, power, etc, but what else do you think I should know? What do you wish you did differently in your first year? all tips and help is appreciated!
cre678521, pure crickets, that's where I come in. Any of these useful?
More suggestions...
I hope those threads give you a bit more insight.
Which of the big 4? PWC?
should have been more specfic, big 4 brokerages (jll, cw,cbre, colliers)
Is that a term now? And Colliers is on there but no NKF?
We should make this whole Big4 of brokerage thing die.
Find a mentor. Target the heavy hitters at your firm and find one that you click with and offer to help. It can be a formal or informal agreement. You can reserve the right to work on your own deals or you can offer a period of time to formally work under that broker. At a large firm hopefully you will already have some of this built in but each firm is different and staying proactive will only help you.
The key is to spend as much time as possible with that person and learn from them. You may develop a lasting partnership or you may eventually go a different direction but you will learn far more efficiently with consistent exposure to a high producing mentor. If you impress and earn the trust of that person that may also present long-term opportunity that otherwise may not have been available to you.
Be diligent on making calls, minimum of 50 a day...maybe more! Make your own data base and have a monthly or quarterly cadence to reach prospects so you are always top of mind to both strategic (owner occupied) and sponsors (PE, syndicators & HNW).
As a broker, your job is to be value add and play in the grey area... even discussing why a deal was done or why a group bought at a super compressed cap rate will make you sound knowledgable (know what groups are IRR driven vs yield driven). Some will get there through leverage or making weird assumptions but those are the groups that you might want to pitch to early on to make a buck.
Investment sales to me is essentially a finance job and you can get people comfortable if you understand the drivers and push people to make decisions.... most people buy based on emotions if you are pitching smaller deals but as you do bigger stuff, it becomes more tactical to get past institutional types with BS.
Read as many OMs as possible, even OMs belonging to other shops to know all the tricks brokers play. Track brokers that overpromise and under deliver and use that against them to win a BOV. Don't talk shit but makes you look good if you can say we are always with XX variance of our guidance.
Go to NAIOP & ULI events and shoot the shit with folks, people talk about deals and what they are seeing in market. I find this valuable to get a pulse outside of the broker sale pitches, etc.
Underwrite deals that have closed and come up with your own conclusion and also ask team members why the deal traded, you will start to see patters.
Know your market inside our and follow national trends that impact industrial (and potentially retail as this impacts supply chain or last mile)
As said earlier, setting up coffee chats and finding a broker at your shop to shadow and go on client pitches with will help you know how to be a cowboy/consultant broker even though you are selling the "dream".
Another book worth reading is Warehouse Veteran: Your Tactical Field Guide to Industrial Real Estate by John B Jackson. Also check out Chicago Industrial Real Time JLL" podcast (you might be in a different market but you will understand how these guys talk about the market). Read sales books and listen to podcast on sales.
On a final note, "KEEP YA HEAD UP"... it's gonna be a grind with a lot of NOs.
Other than the actual sales process advice (make x calls, set y meetings, do z research/homework)... A common misconception is that if you are a 'generalist' (i.e., you do leasing, sales, and all different product types - industrial, multi, retail, office), you can make more money because you have a wider market from which to draw. I would strongly urge you not to do this, and specialize instead. When you're starting out, it's probably OK, but unless you're in a really small market where there's not a lot of deal flow (and in that case, why are you taking that gig?), this will hurt you in the long run. When people hire a broker (especially sophisticated/savvy owners and occupiers), they want to hire the most knowledgeable/most well connected/well respected in a market. While you might have middling success doing everything, the reality is that you'll lose market share to a broker or team that specializes in whatever deal you're chasing. When I hire a broker, I'm looking for someone who is one of the top three/undisputed expert in his/her niche. That's how you maximize value as a seller, is by having someone who knows the product type in and out. Someone who does all product types and both leasing/sales isn't going to be able to get you top dollar for (rent, sale price, etc.) because they don't know 1) who to target and 2) what the nuanced justification should be to defend that asking rent/pricing. It's almost impossible to know this intimately at all times for all asset classes/type of deals. So in summary, my $0.02 is that it's better to be an inch wide but a mile deep in this business rather than a jack-of-all-trades-master-of-none.
Get to a big city where there's density and oppurtunity. Oppurtunity = deal flow.
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