Guys, I'm hitting a wall. What do I do next? Things aren't falling into place.
Hello! I am about a year and a half into the commercial real estate agent career I've so diligently chosen. I'm in the Midwest (USA) and have had few successes. I'm beginning to get worn out of the cold calls, driving around looking for FSBO's, and all the other small things that I do that bring no reward. In my 1.5 years, I've done 1 sale and about 4 lease transactions. These are small amounts of money and I'm going broke! I'm 24, so I never had much to begin with, but I can barely pay my bills. Am I where I should be? Am I behind what is expected this long into the business? What do I do now that the work I'm putting in is becoming redundant and I am simply not able to get things rolling. The small things are becoming tiring and I am less motivated.
[{"id": "gur5zvy", "text": "This sounds normal in this pandemic year. I always tell anyone in sales to allow two years to get going, and in this environment, I would only count non-pandemic months toward the 24. I\u2019m not a broker myself, so others will have to weigh in on how to keep your motivation. If you want to stay with it, can you live with family to cut costs? Keep your chin up. You\u2019re probably doing a fantastic job in what might be the worst years of an entire career.", "replies": [{"id": "gv39mhc", "text": "Definitely have cut costs. I am also in position for my biggest month yet!! Now, that \"biggest month\" isn't exactly a \"huge month\" but it will keep me going for a bit. Thanks for the motivation and advice.", "replies": [{"id": "gv3i5gv", "text": "Congrats! There have got to be deals to be made in reconfiguring office space. I see upheaval but opportunities in the market for those who can hang.", "replies": [{"id": "gv3vauh", "text": "Definitely!", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "gur9jki", "text": "Unfortunately you have entered a market that flipped over onto its head. The commercial market is about to see its first major default market since the 80's. There are two paths you can take from here. \n\nPath 1: current administration will pass an infrastructure bill that will support minority businesses, construction businesses and other green factory businesses. Property for these businesses and surrounding will be a good focus to pursue \n\nPath 2: this is a 2 year stretch, default properties in the commercial market are inevitable due to the number of businesses that have failed during Covid pandemic. Seek out top funding institutions in the commercial industry including big banks and get to know the commercial default managers. They will be issuing properties to commercial agents. One way to track down info on leaders in the industry is using Lanes Guide and LinkedIn. \n\nGood luck with your progress", "replies": [{"id": "gv3aowl", "text": "Awesome. Thank you for the great insight. I am looking forward to it!", "replies": [], "depth": 2}], "depth": 1}, {"id": "gurbjs7", "text": "Are you doing prop management? How are you filling your day?", "replies": [{"id": "gv38b99", "text": "No, my company has a property management branch which is very successful. We also build and own properties. Honestly, my days aren't always full at this point. Some days I work 3 hours, some days I work 10.", "replies": [], "depth": 2}], "depth": 1}, {"id": "gurlxbm", "text": "Can you expand into surrounding areas? How is the rest of your office is doing?", "replies": [{"id": "gv38hnc", "text": "I am the youngest agent in my office by literally 30 years, so it is hard to compare myself. I'd go so far as to believe I'm the youngest agent in the city by at least 4 years. We have a pretty large radius of work that we can work in so that's posssible.", "replies": [], "depth": 2}], "depth": 1}, {"id": "gursq2m", "text": "Many realtors use their license and E&amp;O working for Asset Management companies. Inspection, running comps, property conditions to make ends meet.  One got an appraiser license on the top, he said it fits his personality well. Take the order, inspect, write it up and waiting to get paid. He knows the real estate market better than experienced realtors. Another became a drone photographer they all love what they do when things are quiet.", "replies": [{"id": "gv38l90", "text": "Definitely good thoughts. I'd 100% look into both of those ideas and others that fall in line.", "replies": [{"id": "gv3cqih", "text": "The CA fire and Covid create opportunities in Fannie Mae financed homes requiring inspections. Every home needs a drive by taken photos of outside. While many realtors say I will not do this or that less than $xxx.  Those who accepted the opportunities to become active. With no traffic one drives around his neighborhood pocketed even 2-3K a month. One even rode her bike exercising while getting paid.", "replies": [{"id": "gv3fb2m", "text": "Yes!!!", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "gurx486", "text": "Chances are, if you're out bird dogging every week day (and every weekend), you're just around the corner from staggering success.\n\nCommercial is suffering from a man made (rephrase; politician made) regression in demand.\n\nIt won't last.  Keep doing your job.  Find a way...get a side job. Do *anything* it *takes* to remain in the game.\n\nIn 2 more years your friends will wonder *\"how'd he do that?*\"\n\nIf you'd said \"*in my* ***9*** *years....*.\" I'd probably say you're in the wrong game but, *1.5 years?*  Dude,you haven't even seen enough wind to muss up your hair.\n\nIn 2008, the world ended.  Millions of people mailed in their keys to their banks, certain  real estate values would never in their lifetimes come back to where they were in 2007.  By 2014, they were proven wrong, and by 2020, they wish they hadn't screwed up their credit ratings, and most, driving by their old home wistfully, knew they'd screwed up horrifically.\n\nPeople are going back to their commercial offices, some will stay at home, still more will choose being with others.\n\nAnd people still need \"stuff\".  Stuff comes from warehouses and offices.\n\nThere's a million ways to make money, and only one (proven) way to keep it: Real estate.\n\nGet back to work! (And work even *harder*!).", "replies": [{"id": "guth96q", "text": "This is Absolutely correct that\u2019s what happened to me in my career the second year,", "replies": [], "depth": 2}, {"id": "gv38655", "text": "Awesome. Great reply and motivational! Much appreciated.", "replies": [], "depth": 2}], "depth": 1}, {"id": "gus0o2t", "text": "Bullshit your abilities and look for W2 rolls in corporate commercial real", "replies": [], "depth": 1}, {"id": "gus1zm6", "text": "Also (just throwing it out there) - your plight would likely be the same in another field as well. That \u201cstart of your career\u201d- mid twenty something- life can be rough. At least it was for me! Keep positive, no matter what you do. Things will get better (fingers crossed)!", "replies": [{"id": "gv38mu1", "text": "Thank you!!!", "replies": [], "depth": 2}], "depth": 1}, {"id": "gusjgxf", "text": "What do you want to do with CRE? \nI ran all over the place and chased everything only to find I was chasing dimes for nickels. If you haven't read brokers who dominate by Rod Santomassimo, you should or think about investing in the new training. On the referral side, Are you networking with high-value residential brokers? \nIn my area, we are focusing on business owners that own their real estate. There is a lot of value to sell and least back as an investment property to free up cash. \nAre you using all your tools in costar to identify loans coming due? \nIf you like investors, look at recent purchases between 500k and 5 million, and then search to see if they own other properties. Send them. A personal note to say congrats and then call them. Tell them you saw the purchase and ask them are looking for similar properties. \nThe best advice I can give you is to find a firm that will help you focus and help you learn.", "replies": [{"id": "gv3a14t", "text": "I will look into that book. I did take the N2B course from Massimo and that was helpful, but I still haven't seen much success.\n\nI will absolutely use all of those tips going forward. My biggest struggle is finding new leads, listings and clients.", "replies": [], "depth": 2}], "depth": 1}, {"id": "gusy71x", "text": "Go hunt bigger deals. Talk to buyers, figure out what acquisition criteria is. Ask them if they\u2019d cover a fee if you bring them a true off-market deal (and when I say off-market I don\u2019t mean you heard of an off-market deal from another broker who heard it from another broker etc. Don\u2019t screw your buyers over forwarding them listed deals). Don\u2019t try to sign buyers up on exclusive buyer broker basis either. \n\nCall larger property owners and say \u201cI\u2019ve got capital we need to deploy, we have money burning a hole in our pocket. Can I make you an aggressive offer? No commission\u201d. If they agree, call a buyer or 2 and say \u201cGot so and so deal, let\u2019s make an offer. Can you underwrite 2% (or 1.5% don\u2019t be greedy, especially if you\u2019re working larger deals)\u201d Get a short fee agreement in place with buyer, have them give you an offer for you to deliver and if seller likes it then, and this is super key, connect your buyer and seller and get the fuck out of the way and let them do the deal.\n\nPresent yourself as \u201cI\u2019m looking to place capital\u201d not \u201cmy clients are looking to place capital\u201d. Take your license number out of your email signature. Do not come off as a broker, come off as a buyer with a capital partner. \n\nAs a buyer at an institutional shop, I work with a broker that does this, doesn\u2019t go for exclusive listings only pure true off-market, and makes a killing. Just closed a $70M acquisition on Thursday and the guy made 3 phone calls, put me in touch with seller, did zero work, and walked away with a $560K commission check from us. And this isn\u2019t a guy at a big shop like JLL, Cbre, etc in NYC or something. Solo guy who works from home in his early 30s. Did he add value? Absolutely, every penny of his commission. He got me the deal off-market and got out of the way which is key. If this were a marketed deal, I probably would be paying 15-20 bps lower on the cap rate just to get the deal. The guy doesn\u2019t bullshit either... I know if he\u2019s calling me he\u2019s got an interested seller open to seeing an offer completely off-market. I answer his call every time, even step out of meetings when I see it\u2019s him calling. He has my trust that he\u2019s not going to waste my time. Does every deal hit he brings? No. Seller decides not to sell for whatever reason. Or they list it. (At which point this broker backs out of the picture and doesn\u2019t have his hand out getting in the way of a fee... he knows he\u2019s not adding any value at that point and I respect the hell out of him for that). But he knows my acquisition criteria to a T and finds me deals. Good deals.", "replies": [{"id": "gut4mio", "text": "This is a super interesting take. Thanks for sharing! This really flips the entire commercial brokerage model upside down in my eyes. \n\nAlways nice seeing a different perspective", "replies": [], "depth": 2}, {"id": "guthov0", "text": "Sound advice", "replies": [], "depth": 2}, {"id": "guv0b5w", "text": "This is really interesting. Getting started this takes some pretty big balls to make cold call offers in the (multi?) millions without ironclad relationships but I see what you mean. H\nHow would you recommend finding good/the right institutional buyers of that size in a given market?", "replies": [{"id": "guvt5ey", "text": "I\u2019d recommend focusing on a niche asset type and really work nationally. Every broker I know works nationally. That way you really know the select number of players. You don\u2019t need a license in every state, you\u2019re really just making introductions. But if you\u2019re worried about license, google JDS Real Estate Services.", "replies": [], "depth": 3}, {"id": "gv39bmf", "text": "My question exactly.", "replies": [], "depth": 3}], "depth": 2}, {"id": "gv398bq", "text": "Definitely a new perspective. I haven't looked much into off-market deals, and honestly I know nothing about them. My biggest question in response to this is what methods does your buddy use to find these buyers? Like I said, Im only 17 months in and so I don't have the connections yet to be able to call up guys and present them deals. So my first step would be finding suitable investors.", "replies": [{"id": "gv5z8q5", "text": "Message me, i\u2019ll try to answer in free time", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "guuo3kl", "text": "This is why there are so many already rich people in cre. It takes about 5 years to hit your stride. That is about the time your baby leases are renewing. \n\nMove back in with your parents. It is going to suck, but if you want to stay until that five year mark, you need to cut expenses. \n\nOr, buy a new car and borrow as much as possible. Then you will be super motivated to close the next deal and really hustle. \n\nI joke, but the amount of times I have seen young sales people follow that bad advice is staggering. Have to be optimistic in sales I suppose. \n\nGood luck. The first five are tough but if you can survive you will make it.", "replies": [{"id": "gv38ruj", "text": "Thank you for the helpful words! I will definitely stick with it. I can't see myself working in any other field at the moment.", "replies": [], "depth": 2}], "depth": 1}, {"id": "gvc3t86", "text": "A lot of good comments but younger agents need a mentor or they will be chasing their tails", "replies": [], "depth": 1}, {"id": "gvf1r22", "text": "I'd be careful with some of the advice in the thread.  You definitely shouldn't lie and not disclose that you are a broker and say that you're looking to \"place capital\".  Besides you should expect the seller to pay you something for bringing you a buyer direct.  After all you are providing him a service and should be compensated.  If they are a cheapskate and feel you're bringing \"no value\" let them find their own buyer.  They would have done it already if they  had one.  Don't let them cut you out of paying.  I've brought cash buyers in less than a week to people who had nobody interested.  There's a value in that.  I have them sign an authorization to present a non listed property and we agree on a fee up front because it's professional and gets everything in writing.\n\nI work from home and get many deals and in a short and consistent window, and they're in the multi-million dollar range.  The key is diligent prospecting and good tools to connect you to the right people so that you're not competing for scraps.  It varies by state but the norm is 8-10% here for commercial and land until you get to extremely high numbers so we don't undercut our fees by that much by doing them from under 1%.  The deals are very risky and often take over a year.  It kills me when brokers take on high 8 figure deals for nothing out of desperation when they could have made more on a smaller deal.  I'd rather do fewer quality deals than a ton of cheap deals.  Don't be other business models and race to the bottom.\n\nIf you're doing it right you should always be adding value.  We help our clients sell properties that they couldn't sell before and bring them a large buyer so they net a lot more and have enough funds to buy something bigger and relocate.  Don't be afraid to charge for your time.\n\nKeep on pushing.  I'm happy to help if you have questions.", "replies": [{"id": "gvgl9ir", "text": "Awesome! I appreciate the input. I agree with all of what you said. The hard part for me is finding buyers so I don't have much to offer to off-market sellers at this point. Not sure if I'm not doing the right things to make connections, if it's not happening due to Covid, or whatever reason. So that is where I am missing a lot of action is on that front.", "replies": [{"id": "gvxxwzx", "text": "Hi buddy. Sorry I missed this reply earlier.\n\nInteresting you say you have a hard time finding buyers as most generally struggle with listings.\n\nWhat exactly do you do to get clients? How are you prospecting?\n\nHope you see this. Thanks.", "replies": [{"id": "gvyttg3", "text": "I am actually doing alright on the listing end. I've had a consistent 5-10 listings for the past 6 months now. Part of that are my own clients (currently 5 listings on my own) and some are with other agents (senior agents have been kind enough to bring me on in their existing listings). So I have done a lot of driving around, calling on for sale/lease by owner, Google searches and cold calls. I also have 2-3 buyer/tenant reps that I'm working with.", "replies": [{"id": "gwazup2", "text": "One thing to make sure if that the listings you are getting are able to move and sale.  It's a common thing that happens when people start out.  They take on deals that are not desirable or are unreasonably priced.  I'd rather have 2 clients that are sellable and pay a good commission than 10 that are hard to move and don't pay much.  If listed and marketed properly it should really help.\n\n  \nAlso in commercial you don't want to just wait for buyers like people do in residential.  Simply sitting a property on the MLS and waiting rarely works.  When you are talking to people do you ever ask them about their interest in acquiring properties?  \n\n\nWhat state are you currently active in?  \n\n\nThanks.", "replies": [{"id": "gx5pw2y", "text": "I am active in Ohio. I would say that I've got listings on both ends, some are more attractive, and some are in poor shape or priced much too high. I have fallen into the path of just getting listings no matter the building, thinking that more listings = more sales.\n\nThat is problem the main problem I've identified, I don't come in contact with many people who are looking for property, so my network of ready buyers is very small.", "replies": [{"id": "gx64eur", "text": "Yea definitely don't take the volume approach with commercial.  You are better off getting home runs.  Don't put all of your eggs in one basket either, but just don't take on anything in the hopes of \"getting lucky\" as you're wasting time and resources.  \n\n\nDo you do any prospecting?  What is your main avenue for attracting clients?", "replies": [{"id": "gxakoxz", "text": "I guess my main question is how do I attract a higher number of top-end clients? Right now I just do cold calling and driving around looking for FSBOs.", "replies": [{"id": "gxamomw", "text": "What tools are you using to call? Calling works great if you have the right data.", "replies": [{"id": "gxamv65", "text": "Not really any tools at all.", "replies": [{"id": "gxautt2", "text": "I'll message you and go into more detail there.\n\nThanks. ;)", "replies": [{"id": "gxrc76l", "text": "Did you message me? I haven't received anything and want to make sure I'm not missing it.", "replies": [{"id": "gxrx8lo", "text": "Give me a bit. I am just coming home.\n\nThanks.", "replies": [{"id": "ikf0c3e", "text": "I am a brand new CRE agent and reading this was very helpful. What prospecting tips would you suggest for a newer agent? Would it possible for me to send you a message as well?", "replies": [], "depth": 14}], "depth": 13}], "depth": 12}], "depth": 11}], "depth": 10}], "depth": 9}], "depth": 8}], "depth": 7}], "depth": 6}], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}]