Brokers Play Musical Chairs as Marketplace Dynamics Change

Some professionals prefer to stay with simple, straightforward, local one-off transactions, while others seek a more challenging environment working with global clients who use the Internet increasingly more to create and cement deals.

"Brokers are making their choices and placing their bets" on which companies are best for them, Coley says. "And there is nothing really wrong with that at all." Boutique firms "do well," the longtime Trammell Crow executive in Florida says.

But linking up with major brokerages such as Crow, Jones Lang LaSalle, Insignia, CB Richard Ellis Inc., Grubb & Ellis Co. and Cushman & Wakefield, for example, offers brokers an opportunity to deal with clients "at a new level of sophistication," Coley says.

Working with national and international clients, brokers become, in effect, corporate portfolio managers as they learn the client's business strategies and try to coordinate the real estate assets with a company's other assets.

"Some brokers like to be part of a full-service company operation while others like it the way it was, going back to the basics," the Crow executive says.

For example, "a client says he needs 25,000 square feet in 60 days--find me the space," a broker is told. "That's a simple, one-off transaction and there is nothing wrong with it," Coley says.

But at the larger brokerages, such as Crow, production per broker is "watched carefully," he says. Some brokers like that pressure; others don't. The deals need to be coming in the door regularly and to do that the company's high-tech resources play a key role.

At Trammell Crow, Coley has seen the broker staff double to 600 from 300 over the last four years throughout the Dallas-based firm's global offices. "On the production per broker level, we have fared well compared to other teams," he says.

Major clients today generally ask two crucial questions of brokerage houses they are interviewing to handle their real estate assets, Coley says. They are, "Show me your team and show me your technology."

Coley concedes the bonuses and higher salaries being offered to the big hitters in the brokerage business also play a role in brokers changing firms at a faster clip than they used to. But, he says, "we are always going to have that situation," regardless of the economy.