Its evident that in large markets you need to specialize. I am in Boston and looking to begin my brokerage career, but I am unsure what to specialize in (ex, investment sales, retail, industrial, flex, landlord rep, tenant rep, buyer/seller...).
Could you elaborate on what you and your teams specialize in and the difference in day to day duties (who are dealing with, how consistent are deals)
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I wish I was more specialized. Those that know me say I'd get so bored being a MF broker, or, working for Chase slinging squeaky clean CRE loans around $2mil.
I have and probably always be a guy that's in the trenches of mid-market deals. Most with a little hair on them. These are great clients who have been humbled a little bit and will pay you full fees. Example, if you need a broker to represent you on a 50 unit broken condo project (100+ total units) with a failing HOA and you need financing too. I'm your guy. Got a 20 acre 30 tenant outdoor auto wrecking yard near Mexico and want bank financing? I'm your guy. Did your in house property manager steal $300k of rents in 2015 on your apartments and you want a bank loan despite those crappy financials. Hey, I'm your guy.
Sometimes I'm negotiating a 10yr lease to book a refi that will later be assumed when I list the building 6mo from now. Stuff gets weird as an independent broker. Things seem much more specialized at the big brokerage houses.
This is what I do. Some of my friends in the business love the stories and wonder how I do it. I wonder how they do it.
I used to have staff, a full time assistant, owned an office building and did all that. I don't think I'll be doing that again unless I dive into a property management venture (ugh). I enjoy working from home in my boxers, going to Muay Thai from 10:30 to 12:30 4x a week and taking my mid-day nap.
Deal flow in 2016 is good. But only cause I do loans too. I can't get a client to exchange to save my life right now. There is nothing to buy. Can't blame them.
Boss...How'd you manage to get to that level?
I don't really know what level I'm at right now. I'm not in all the publications locally with the monster deals. Yet, as a broker, there is nothing wrong with doing a $6mil deal. These clients pay equal $$$ on commissions as a $12mil deal. Mid-market deals pay the bills. The $15-20mil and up deals pay off the bills. Those come around but my pipeline is full of $2mil - $10mil deals.
How I got here was a bumpy road. It's not supposed to be easy. I did residential 1-4 unit loans and sales from 1995-2000. That was a terrible existence even though I was good at it. I worked next to a girl who's father was the local VP of commercial lending for a well known West Coast S&L. He needed a referral source for the deals his bank wouldn't do. Slowly that relationship grew. I still have clients from those referrals dating back 15 years. The clients that let you do a $3mil loan will most certainly trust you to sell that building as well. That's how I started listing buildings, rep them on an exchange property and also closing their purchase loans. These are nice pay days.
Knowing your local and regional lenders niches is key for not only brokering loans but for buying/selling buildings. People don't need me because they can call Chase or Wells. How many deals has a buyer passed on because they didn't think they could close with a decent loan? If you deliver for a client on tougher deals, they pay full fees and seem to come back for more.
I have experience in leasing but want to become more of a multi tenant broker here on the coast. New sources of income may feed me during a market downturn when larger transactions are gone, and they do go away. I'm working on a 7 loan portfolio refi for a coastal property owner. All his commercial buildings are vacant on the second floor. Just due to him being old and not listing them (yes really). If the loans go well we are to negotiate me being their leasing broker on about 100k sqft of coastal commercial.
Not everyone does it the way I do. This just happens to be my niche. I'm not always happy with it. But I'm now comfortable with my place in the industry.
This is awesome. I'm out of the brokerage business now but always had mad respect for the dude slinging deals out of his garage. Had I stuck around that would've been my long-term plan. On the development side I work with brokers now and you're a rare breed. 95% of brokers I've worked with just want to get paid for doing little to no work. I always pay dividends to those who go above and beyond to deliver real value.
Funny story: when I started as an office ten rep I'd show up to broker open houses and the established leasing brokers would ask what type of deals I worked on. I'd always tell them I specialized in 'big deals'.
Looking back it was a douchey thing for a 23 year old to say. That said, I could back it up because I sourced one of the largest office leases in my market during my first year. Plus, stirring the pot a bit was always fun.
My advice would be to worry less about what product type you're specializing in right now and instead focus on hooking up with the highest profile deal team you can find, regardless of what they do. I'd spend time identifying the BSDs for each product type in your market or your firm and work to get on their teams. You'll get exposed to bigger and better deals, work with higher profile clients, and learn a helluva lot more when you hook up with the biggest producers in your market.
I was very specialized when I was a broker, dealing only in downtown high rise B+ and A- office on the asset side.
Thanks for the response CRE. could you elaborate?
I'm not sure what to elaborate on. Feel free to ask questions though.
I specialize in Investment Sales (Multi-Family mostly). I spend most of my time calling owners and investors, setting meetings, underwriting properties, making marketing statements.
Retail IS. Most big shops are extremely specialized.
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