Real estate advisers can develop strategies, research alternatives, negotiate deals and manage relocations, but there’s one thing they can’t do be the client. Clients play a key role in the effectiveness of the real estate process.
“The way a client participates in a real estate project can significantly affect its outcome,” says Jeff Shepard, principal with CresaPartners in Orange County. “Certain clients understand how to work with a professional real estate adviser in a way that notably improves the results.”
Smart Business spoke with Shepard about tips for partnering with real estate advisers to achieve the most successful results.
What client mindset enhances the real estate process?
The first key point is that clients need to stay highly flexible and adaptable during the process. Their first choice may fall through, then their second choice may not work out, but they can still end up with a great outcome. Tenants need to have the willingness to reconsider and adapt their ideas to fit their changing reality. It’s almost certain that something unexpected will happen in a real estate deal.
Next, clients need to pick a real estate professional they trust and then trust that person. They’re hiring real estate advisers because they have expertise beyond what’s available internally. That means once clients hire advisers, they should listen to them, consider their advice, benefit from their experience and insight, then make their own decisions based on all the input and data. Some clients reluctantly receive input because they themselves have some real estate negotiating experience. It’s important to remember, however, that skilled real estate professionals have a vast store of skill and knowledge from closing 50 to 60 deals a year, and their expertise should be leveraged.
How can clients’ timing affect the outcome of a project?
Clients should decide when they think a real estate project should start then move that date three months earlier. Just like in theater, every real estate negotiation has an X factor the unexpected element that will cause delays. Starting ahead of schedule allows enough time for the X factor to occur and for decision-makers to adjust and make unrushed, sound business decisions.
Once the real estate process is underway, it’s critically important that clients respond quickly to opportunities. Sometimes a property unexpectedly becomes available or a landlord creates a short window when new clients can usurp a delaying tenant. By responding quickly, clients can gain the prime negotiating position in a transaction and hence better control the process for a favorable outcome.
How does client interaction with the landlord impact negotiations?
Landlords would rather negotiate directly with tenants. As such, clients need to be prepared for landlords to try to bypass their real estate adviser. Clients must set the tone with their landlord from the beginning by communicating clearly, respectfully and decisively that they have hired a real estate professional they trust to guide them through this important and complicated decision process. By reaffirming their complete support of and trust in their professional representative, clients maximize their leverage instead of undermining their real estate adviser and the negotiation process.
What information should clients provide for their advisers upfront?
At the initial project meeting, all the people who will need to weigh in on the real estate decision need to be present. This ensures that everyone helps define and clearly understands the objectives, strategies and tactics from the beginning. Throughout the project, anyone who will be involved in the final decision should receive communication about the justification of and explanation for any decisions or actions. This method fosters support, cooperation and involvement throughout the transaction so that decisions can be made quickly and efficiently.
What role do clients play (and not play) in the real estate process?
All participants need to play their part on the team. At some points, the real estate professional is the appropriate leader. At other times, the real estate adviser directs the client to take a lead role. It’s important that clients be willing to trust their adviser and play their part in the process. In addition, creating an internal project team upfront and clearly defining each person’s role facilitates this process. This team can help give the project a clear direction, keep the work on track and make timely decisions.
JEFF SHEPARD is a principal with CresaPartners in Orange County. Contact him at email@example.com or (949) 706-6640.