In the CRE industry, there are specific personal qualities or characteristics that are essential for individual success, whether one is a real estate investor, broker, lawyer, consultant, or developer. The CRE industry is one of the only industries that is transaction-based. This means that the vibrancy, wealth, and success of the industry is based on sales, leasing, and financing transactions. The more transactions in these areas, the healthier the industry and the more financial success of participants in the industry. However, to even be more successful, CRE players require a special skill set that is not easily achieved. Here are seven of these skills that are necessary to be a successful participant.
- Conviction. The CRE participant must have solid convictions on its consulting, investment, brokerage, or development transaction or strategy and be confident enough to ignore those who disagree. Great decision-making ability is one of the most important keys to success in the industry. Decisions should only be made after a detailed analysis of the facts and circumstances, supported by financial, market, tenant, or other data and consideration of and recommendations from others. Once a decision is made, the participant must have conviction and not waiver or buckle under criticism from others.
- Experience. The most successful CRE participants have accumulated years and years of experience in the industry in different markets, property types, transactions and economic booms and busts. Participants that have been in the industry for two decades or more have a keen sense of the markets, different properties, and myriad of financial transactions. The more experienced an individual is in the industry, the better decision-making process they will possess.
- Patience. The CRE participant should have great patience as real estate investment is a difficult long-term business. Whether one is in the investment, brokerage or development side of the business, success depends in large measure on the ability to recognize undervalued investment opportunities, establish marketing programs and relationships for sales and leases and the fortitude to develop new properties. Many large and complicated real estate transactions can take years to develop, nurture and close. All of these skills require patience and the ability in many cases to be a contrarian.
- Hard Work. To be a successful CRE participant, one needs to work hard. Working hard does not mean 40 hours a week, but 70 hours per week or more. All successful investors, whether in real estate, finance, investment banking, corporate investment, etc. have a hard work ethic. In CRE, working hard means obtaining a thorough knowledge of a property, market, financial data, tenancy, economy, interest rates, competition and risks and using this knowledge to effect profitable transactions.
- Knowledge. A successful CRE participant should have a significant knowledge base about the brokerage, investment, and/or development transaction in question, including information on the property, market, tenant, financing, investment returns, competitive properties, interest rates and the economy. The best way to gain this knowledge is through the experience of closing many transactions but also from reading, writing articles, attending conferences and making presentations.
- Ambition. Real estate players must have a deep desire to do or achieve something, typically requiring hard work and determination. This may be being the top-producing broker in the office or starting your own real estate development firm. Having ambition means that you work hard at your job to get ahead, achieve your professional goals, and contribute to the company's success. You likely take on added responsibilities and duties to show your ambition in your role. Employers value the quality of ambition in many positions, such as real estate sales, marketing, finance, development, brokerage, and management.
- Confidence. For successful CRE participants, confidence is the belief in your abilities and skills. You trust yourself to take the best action, and you rely on your knowledge and experience to get the job done. Confident people focus on their strengths and learn from their mistakes quickly. As a confident real estate player, you complete your tasks with accuracy and skill while showing others the way. Employers value the quality of confidence in various positions in the CRE industry.
Joseph J. Ori is Executive Managing Director of Paramount Capital Corp., a Commercial Real Estate Advisory Firm
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