Thanks to Lisa Abrams-Cruz - a soon to be ActiveRainer and to Cyndee Haydon, my fellow Wildcat in the Sugar Sands of the Gulf Coast for making me think about this post enough to come up with something coherent...and thanks to Renee Burrows for kicking me off with a post that this legitimately compliments!
Renee's post was titled When You are Just Getting into the Biz ~ Sphere is #1! and now I will illustrate one way for Residential Realtors to get a taste of Commercial, using their Spheres!
In a previous post, a VERY early post for me, I wrote about How to turn your C inventory into your A clients - it is a theory of Production Management that I learned during my MBA. In this case, I'm going to couple Renee's ideas with C Inventory to show you how to get a start in some Small Commercial Real Estate transactions.
So... let's review. Your Sphere of Influence is the people you know that know you. Friends, Family, past clients/customers/vendors etc... basically people that know your name when you call. Taken a step further as your have progressed in your Real Estate Career... your Sphere should have grown with your Database.
Now, you not only have that person you used to carpool with... but you have their friend Joe, their little sister and 3 or 4 of their co-workers too!
Then there are the people that bought from you a while back, you've sent some cards and such... but you really haven't heard from them in a while. They are your C Inventory. They're in your database... on a shelf... gathering dust just like that fuel pump for the '73 Camaro you restored three years ago but it still sits covered in a tarp in your driveway. In business... it is the products you stock but rarely sell.
So what does this have to do with Commercial Real Estate?
Everything! Now is the time to look through that database and RESORT your data!
What should you be looking for?
- General Small Business Owners
- General Contractors
- Plumbers who own their businesses
Pretty much any entrepreneur type will do.
What's the gig like?
Well, you should be keeping up with these people in their goings on - just like normal. Now, though you're going to schedule some time specifically to offer the new service of finding them Commercial Real Estate Options for their Practices and for Investment Purposes.
One scenario is:
You -, "Did you know that you, Dr. J, can BUY your office space with 100% financing to Doctors AND great rates??... No? Well, I have a mortgage partner that has access to some local lenders offering that program. Doesn't that sound great?"
This is the same Rent vs Buy scenario you pitch to first time homebuyers but now you get to talk to them about Depreciation, Tax Advantages, Long Term Gain, 1031 exchanges... all those great things that come up in a commercial talk.
Dr. J - "Well... I'm not sure I would do 100% financing in this market and I don't think I have the cash to put down on what I need."
You - "But you are interested! So maybe we just need to get David on the phone and he can talk to you about some options that might help you get there. He knows how to make these deals work out perfectly for your specific financial needs..."
Dr. J - "I did see all those Medical Office Condo signs up Jog Road in Boynton Beach, Florida and I would love to have my practice nearer to my home AND most of my clients are up there"
You - "Sounds like a match made in heaven"
Another scenario would be for a General Contractor:
You - How's business Mr. Carpenter?
Mr C. - Great... we're so busy and we're bursting at the seams. I need to grow my company but I just can't seem to get it done right
You - Well were you thinking of getting some more space? Maybe buying... and getting a Working Line of Capital to help you with expenses?
Mr C. - Yeah ... that would be great. I've got 1500 square feet and 20 employees jostling for room. I need some storage and a better office space or my secretary is going to quit again.
You - I know there are some great contractor parks out there with units for sale in this area. On top of that you might get some referrals from your neighbors in similar businesses. With today's great rates, you should also talk to my mortgage partner... he can get you great rates with 10-15% down!
Mr C. - I would love to talk about that!
You - why don't I patch him in and we'll set up a meeting right now!
Yeah Yeah Yeah - role playing is silly... but most great sales training courses have it mandated!
The point is, Now you have the list of clients to target in your list. They are your C Inventory because they haven't been taken off the shelf to sell them yet! They can become your A Inventory because you could get them into another transaction if you just know what buttons to push.
It isn't even about finding them the space. Commercial Space is easy to find - it is on the main roads. Seldom do you find normal businesses hidden away... but should you need one, you'll find it! Most office Condos are on main roads. Most Warehouse Condos and Industrial Condos are clustered in certain areas of town.
So you know what area they want to be in, you know what type of property they want, you know square footage..., start driving! Take your camera and take some notes. You'll find it for them in no time.
Between you, me and a good commercial real estate attorney, we can create your first real commercial deal and make it SMOOOOOOTH sailing!
Whether your client wants to buy an Office Condo or Office Building, a Warehouse Condo or an Industrial Park, a Retail Condo a Strip Center or a Shopping Center... or if they want to just invest in some new property...working together, we can get you on your way to selling some commercial real estate!