Respecting the Art of CRE Sales

LOS ANGELES-Success is fleeting in our industry. Bringing home regular commissions and calling commercial real estate brokerage a career requires titanic effort—one which only a tiny percentage of commercial real estate salespeople can claim. 

In my mind, a salesperson's activities can be classified as their career if they earn at least $300,000 in gross commissions consistently for three years or more. Because commissions are split with their broker, take-home pay may be as little as half that, or $150,000. Though this may seem like a significant income to some, Los Angeles' high cost of living quickly diminishes the initial figure.

We're fortunate that most of Charles Dunn's salespeople earn considerably more than that minimum target. In one of the largest commercial real estate markets in the country, we are experiencing a steadily strengthening market. At our firm's recent 2013 kickoff meeting, I noted that the economy was one of several contributors to our phenomenal success last year, but it wasn't the most important. The success of our producers in 2012 can be attributed to the reinvention of their individual practices.

Greater market knowledge, persistence, diligence and relationships made for a highly rewarding year. Many on our sales team were wildly successful in spite of a still-weak economy. It's not the economy, stupid! It's the sales team.

Competition lessened as low-producers exited our recession-battered industry. While only 30% of our sales force remained in the industry, their strengthened market share has only gotten stronger as they've refined their business practices.

Why, when so many are struggling and without work, are these people seeing such success? Much is due to their ability to adapt, innovate and dig deeper. Some ultra-seasoned brokers segmented their processes and acquired additional staff. Additionally, a commitment to mentorship and partnering with rookie brokers enabled them to cast wider nets, work more efficiently and effectively, and reenergize themselves with younger, more exuberant team members—all of which contributed to capturing greater market share.

To maintain our success in the still-lagging economy, we've refocused our strategy on recruitment. Never before have we had such a talented pool of young people to recruit from. Despite the mass exodus of low-producers in our industry, the reduction of our sales team through 2012 led to increased efficiencies and practices. Without looking back, we've been on a recruiting tear, with the goal of hiring 10-12 new people every 6 months.

Yes, the economic outlook is still bleak. But the success we've experienced despite that has bolstered our motivation to take advantage of opportunities presenting themselves in our marketplace. Rather than poaching senior pros from our competitors, it's time to invest in long-term training and mentorship. Combined with an aggressive restructure, upgraded operations, and commitment to targeted, strategic investments in technology, marketing, research and support for our salespeople and staff, we have a winning game. With these elements in our playbook, the economy can do what it will. When field conditions lack muster, it's the players who win the game.

Walter F. Conn is president of brokerage services at Charles Dunn Co. The views expressed in this column are the author's own.