For those of you in NYC - what are the biggest differences between working in residential vs. commercial real estate?
I started at a firm working in residential, but they said I can't do commercial until I'm ready. I know it's two different playing fields, but how exactly do the two differ from each other?
[{"id": "d9mb3xv", "text": "in residential you're the expert to the client. You actually add value, but the client often doesnt realize that. \n\nIn commercial the owner knows more than you. Its just that he doesnt want to do the work so you get to cold call for tenants/buyers. Also, you're not the only broker working the same deal. We have every single broker that calls us working it as well and we broker the brokers. My advice is to stay away from commercial. You'll get eaten alive if you're not starting out at one of the major professional commercial brokerages. But prepare for sleepless nights and dreams of your teeth falling out for a year or two. You will need to make 60 cold calls a day, 5 days a week, 15,000 in one year, and 30,000 by the end of your second year to see one deal to completion after 2 years of working. Thats 30,000 rejections to get one commission. Let the big boys handle it. if you want to try it then work for a big boy. \n\nWhen I get calls from a residential agent I dont take them seriously. Agents don't know anything relevant to us for a commercial transaction. I will talk to a commercial broker from a reputable firm even if they are young. If they're from the right firm then they have been trained and also it means they can bring on a heavy hitter. And we already know who the heavy hitters are at every firm.", "replies": [{"id": "d9rtq3z", "text": "Whoa...thanks for **Reminding us of Reality in Comm.RE**. It also depends on the market your in, and what you are pushing, but generally speaking, i would say you are RIGHT!\n\n", "replies": [], "depth": 2}], "depth": 1}, {"id": "d9megrh", "text": "I'll take my knowledge of the NYC residential market from my personal experience in NC and from TV.\n\nGenerally you can't 'sell' a commercial deal like you do for a residential deal. The value of the property is the income, not what a few rich people are going to outbid each other for because of the neighborhood.\n\nThen there are the legal differences, financing differences, etc. Being the most competitive market in the US, one of the most competitive in the world. \n\nI'm sure you can hunt and find small deals with hair on them, my exposure to NYC is on the debt side of deals and few are under $10M", "replies": [], "depth": 1}, {"id": "d9mt9ho", "text": "Commercial also requires pretty big upfront costs. You'll be paying people like me to evaluate sites and advise on feasibility issues just so that you can accurately price your listings (especially when dealing with development sites). The marketing packages for commercial properties here are expensive to produce and pretty much required given the competition.", "replies": [{"id": "d9s09ti", "text": "Let me guess....you're an appraiser?", "replies": [{"id": "d9s0wsj", "text": "Nope. Zoning Consultant/Architect. ", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "d9n3zp3", "text": "The residential market is a lot steadier than the commercial market, people pretty much always buy homes and are willing to pay premiums for what they deem as a need. You can sell them those needs and make money in residential regardless of what direction the market is heading in. \n\nCommercial investment is much more matter of fact and depends more on the micro and macro economies of the time than your work ethic or sales ability. Are investors bearish or bullish, is your particular product category hot at the time because it's a safer bet or because people see value in it? Commercial buyers know what they are doing, they know the mathematics of making a sound investment, they know what cap rate they are looking for and what comparable properties have traded for including all their metrics. Commercial in my opinion is just about securing the listing and putting the right investor in front of it to match his/her particular portfolio. Some properties literally stay listed for years on end without any interest. \n\n\nIf I could do it all again I would have skipped commercial sales. I hate cold calling people and the lead generation is almost entirely bullshit.\nI was given two homeless shelters in Manhattan to sell as my first job, you have no idea how much that sucked.\n\n", "replies": [{"id": "d9s0cqi", "text": "Homeless shelter....in NYC?", "replies": [{"id": "d9s2m32", "text": "Two Single Room Occupancy Buildings with 81 units each...In Hell's Kitchen. Imagine a lot of old men living with HIV in closets. Imagine trying to convince someone with $100 million in the bank to even do a walk through.", "replies": [{"id": "d9t88ec", "text": "Sounds like a knock down. Did they buy it for existing use?", "replies": [{"id": "d9u9m1a", "text": "Can't knock down SROs without going through a lengthy Certificate of No Harassment process. (This is why people pay me).", "replies": [{"id": "d9xcndi", "text": "No harassment---by gov.? Seems like the city would want something like that torn down.", "replies": [{"id": "d9xe6ca", "text": "No harassment of the SRO occupants by the developer or anyone hoping to get a permit to perform work in an SRO site. ", "replies": [], "depth": 7}], "depth": 6}], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}]