It’s quite necessary to “build your resume” with months or years of sale transactions before you venture off into huge deals.
I’m penning this column from our oldest son’s breakfast room.
You see, he and his wife and their three beautiful children live north of Austin, Texas, which is my home for the next few days. Our agenda includes lots of hugs for papa, wary looks and barks from their new puppy, a birthday celebration for #2 of our five grands and caddying for our son as he played in a qualifier for the Texas State Amateur. For those not bitten by the golf bug – it’s sort of a big deal.
Stay with me, commercial real estate is coming, I promise.
Our son has never – until yesterday – played a competitive round of golf. But he maintains a 5 index – quite respectable for a recreational golfer.
Consequently, yesterday was a huge stage! Akin to singing at Segerstrom when you’d only sang karaoke at the bar, he was a bit outclassed. His demise was epic, humbling and embarrassing as he carded more shots in four holes than most do in nine. But the learning experience was life-altering. I believe the lessons he learned apply to commercial real estate, so — fore!
Quite apparent were the absence of competitive rounds and a foolproof pre-shot routine. In our trade, what he attempted was to sell a 100,000-square-foot logistics building when his previous record was a 2,000-square-foot lease. Doable but highly unlikely.
It’s quite necessary to “build your resume” with months or years of sale transactions before you venture off into huge deals. Our pre-shot routine of relationship building, qualifying, controlling and transacting provides a gauge of how things are progressing. Once you’ve taken these steps for a while, they become rote. Skipping a step will always bite you. Similar to a shank – you just don’t know when.
Sorry to mix metaphors, but just when should you try for the big transactions? My rule is not until your expenses for the year have been paid from smaller closings.
Whopper deals are elusive, buyers and sellers more sophisticated and competition fierce. Large real estate contracts have more attorney scrutiny, lender oversight and can take more time. If your staying power is compromised, the waiting is agony.
You must place yourself in positions that mimic tournament conditions — the nerves, the fear of failure and the penalties for errant shots. In our world, practicing a pitch is great but drastically different than performing live.
The more opportunities you give yourself to compete for assignments, the better you’ll be. The nerves vanish. Sure, you may get some pre-proposal jitters but once you start, they go away.
Made famous by Wayne Gretzky, these words are applicable to life, golf and commercial real estate.
I was very proud of our son for his attempt. It took real moxie to tee it up with the big boys. In a brokerage, it’s fine to compete for assignments outside your comfort level. It’s how we grow. But, just be prepared to be humbled … often.
Just always take away two things you’ll do things differently the next time. Is transactional experience lacking? Are you unfamiliar with the market? Could your team use another member? Are you with the wrong firm? Consider all of these carefully.
Allen C. Buchanan is a principal with Lee & Associates Commercial Real Estate Services in Orange. He can be reached at abuchanan@lee-associates.com or 714.564.7104.
