By Jerry Anderson, CCIM, executive managing director, SVN Florida
The best CRE brokerage company for you? – The debate continues. The debate comes up when you consider making a change of CRE brokerage companies. Work under the umbrella of a large corporate or publicly owned brokerage firm? Join or affiliate with a national brand that has an “independently owned and operated model?? Tuck in with an independent “boutique” firm with limited brand awareness? Or even open your own brokerage operation with your name as the “dba” and compete on personal local relationships alone.
Your brokerage company’s name versus your success
On one hand, the brand recognition value of a larger commercial real estate company especially if a global or national player cannot be understated. You have immediate recognition as a real estate professional when you use the name of the recognized brokerage firm, whereas the boutique brokerage name most likely will not open doors for you.
Of course, individual effort and accountability factors are often overshadowed when tied to a name brand. One might argue that the advantage of agility and quick decision-making is on the side of a boutique entrepreneurial brokerage operation and the firm’s reputation in the local market.
In most cases, a CRE salesperson starts a career at a brokerage firm. Some firms have more structured training programs than others, but usually some form of shadowing or working with more veteran agents takes place. In CRE, your expertise is likely learned under the wing of someone that flew the same flight path. The continued longevity and success of a number of CRE training and coaching companies catering to CRE agents indicates that training is NOT available or appreciated in most CRE brokerage companies.
In Florida, you must be a sales associate for a minimum of two years prior to being eligible to take the “real estate broker license course.” Upon successful completion, you become a registered broker and can open your own firm and become the “Broker of Record” even though you may have NEVER received any training for actually owning and operating a real estate brokerage company. Now, that is really scary.
At some point, many lift their head up and look at other opportunities or even aspire to own their own brokerage operation while for others, it simply is not on their list of aspirations. A number of agents I hired, trained and mentored in the late ‘80s when I was a manager at a South Florida large national brokerage company are still at the same firm decades later. If anyone should have been able to attract them to make a change to my favored national firm for the past several decades, it should have been me. They may be locked into a 50/50 or 60/40 split and strangled by corporate policy, but they are very happy and secure with a behemoth global firm. I have the upmost respect for the company as well as the loyalty and longevity of the agents I recruited into the industry many years ago.
Earned, not given
Remember, your success in this business is earned — it is not handed to you. Client assignments through the brokerage office’s manager or national brand name do not fast and furiously drop into your lap. You must network, provide valuable market data, gain and maintain encyclopedic knowledge of your territory or product, market listings extensively PLUS establish your own individual identity to become a reputable CRE advisor.
Every contact is a potential client, if not today or tomorrow, then maybe years down the road after constant multiple interactions. Referrals are based on your actions, reputation and connectedness, not simply by virtue of the company name on the door. But being with a top 10 recognized brand helps your credibility, helps you become “the safe choice” and, of course, it connects you with other CRE professionals that are also part of the brand.
Often real estate salespeople shift from one brokerage firm to another because of lack of sales training, nonexistent promises of support, challenging market and unfulfilled promises of leads being provided. Some are hypnotized into believing that a high agent commission split is the secret to a successful career. It’s not, by the way, as high splits to agents is a current major problem for brokerage firms.
For most, it is not a sustainable or growth business model for the broker/owner, thus weakening the very platform the agent depends on. Nonetheless, some agents jump from firm to firm or office to office, searching for nirvana. However, changing brokerages and yet maintaining your sales volume is a good indication that it’s your sales ability and work ethic that provide the foundation for your success, not your brokerage firm’s name.
You understand what works plus is comfortable for you. Try to find the right environment and culture to ensure that what you need to continue to build on your success is available to you.
As you seek out alternatives to your current brokerage firm, you might ask yourself:
- Will the recruiting promises of the new brokerage firm REALLY be fulfilled?
- Can I build my personal reputation under this brokerage name?
- Is the firm a recognizable brand (I suggest looking at the top ten most recognized brands to see which firm’s focus and culture might be a fit for you)
Which leads us to the question about your real estate career: Do you see yourself in CRE brokerage in 5, 10, 20 or even 30 years? (I never did, but here I am 35-plua years into my career and still ridiculously passionate about the business.)
Shifting from brokerage firm to brokerage firm seeking long-term sales success might not be in your best interest. At some point in their career, every real estate professional must answer the question (if not to others, then certainly to themselves), “Do I have what it takes to own a real estate brokerage or at least be in a more entrepreneurial environment where I control MY OWN destiny?”(Just so you know I have a number of VERY high producing advisors on my roster who do NOT want to own their own firm. And they would have an inside track to owning an SVN office in Florida.)
It’s easy to find the answer, just look at your past production. Has the firm REALLY earned their share or are you the one keeping their doors open? What CRE brokerage environment and structure is best suited for you? Corporate, entrepreneurial, independently owned & operated affiliated with a ranked brand? A firm where you are closely managed, monitored and held accountable for every single phone call? Is “loosely managed” more to your liking, as you are extremely self-disciplined and even tough love can be offensive to you? Perhaps a local tightknit family boutique firm locally focused? Companies are like clubs, neighborhoods or any other group – as you interview them and perform your due diligence, you will know when it “simply feels right.”
The benefits of each type of scenario are varied but almost always start with three questions as you survey your options:
- How comfortable will I be conforming to the corporate structure of some of the larger global brokerage firms?
- How will I succeed if my name and reputation are the sole influencers on my marketing efforts of a boutique brokerage?
- What does the affiliated, yet independently owned and operated, brokerage model offer in terms of a strong brand name, tools, systems and resources that I need to increase my production volume. What opportunity is there to grow creating enterprise value for ME if I choose the ownership route?
With these answers the undertaking of moving to a different brokerage company or maybe even opening your own brokerage firm, will become crystal clear. You may very well be starting the journey to become a true entrepreneur by adding “business owner” to your list of real estate achievements. Ask yourself:
- How will the tools, technology, resources and services of the company I’m investigating help me grow my revenues enough to offset the costs and pipeline lag of changing firms?
- How many assignments do I need “because of the brand” or from other advisors in the system to pay two or even three times the cost of making the change?
- How will being part of a firm that has top national ranking and recognition get me invited to more opportunities, elevate my business and create enterprise value for my operation beyond what I could do on my own?
- MOST IMPORTANT – Is the culture of the firm one that I yearn to be a part of? Is the firm’s reputation one that I want to wear on my shoulder? Are the ethics and morals of the company ones that I espouse?
If I can be of assistance in your decision making even if only as a sounding board, contact me for a confidential conversation. I may not have the answer for you but you can tap into 35-plus years of experience of consulting and leadership in the CRE brokerage industry. Been there, done that, as they say. Jerry Anderson, CCIM, SVN Florida Commercial Real Estate Advisors firstname.lastname@example.org 386-547-4968. Anderson is the Regional Developer for SVN International Commercial Real Estate Advisors in Florida and is always on the lookout for 1) independent firms that want to be part of one of the top companies in the industry WITHOUT giving up their independence and 2) CRE advisors that want to be part of company that has a culture of collaboration and “doing what is right”.