A leasing team’s chief objective is to work with property owners to help them find, secure, and keep dependable tenants in their buildings. These tenants should preferably be signed at or above market rental rates to ensure that your property continues to be a strong commercial real estate investment. The efficiency of the leasing team in achieving these goals is a consequential factor in a property and property owner’s ultimate success.
Because of this, it is vital to build an effective and trustworthy leasing team to navigate the increasingly complex property market.
So how can you tell if your leasing team is effective or if it’s in need of an overhaul? We’ve compiled a list of five telltale signs that you should consider hiring a new leasing team.
1. Your Team Lacks Rapport with Tenants
In addition to helping property owners find viable tenants, the leasing team is often the face of the ownership visible to the tenants. The leasing broker will lead potential tenants on property tours, engage in lease negotiations, and may also be the main point of contact alongside the property manager for a tenant in the building. Due to the nature of this role, the ability to effectively communicate and establish a level of trust with tenants is key.
This rapport remains important throughout the life of the tenant’s lease. A leasing team must be able to quickly adapt to the tenant’s changing needs over time. By maintaining this rapport, your leasing team will know (even before expiration is on the horizon) which tenants are interested in expanding or renewing, and even which tenants may be looking to right-size or relocate within the building, and this can be valuable when managing multiple tenants. For example: say your building is 100% occupied and one of your tenants is looking to expand. If your leasing team knows that another tenant in the building is looking to downsize, they may be able to expand the first tenant into that extra space.
Leasing brokers who are able to successfully navigate this relationship will consistently leave their tenants more satisfied and more likely to renew their lease when it runs out.
2. Your Team’s Marketing is Underwhelming or Subpar
Having a wide range of marketing skills is essential in today’s competitive market. If your leasing team lacks the ability to showcase your property’s value and differentiating factors, chances are you will be dealing with vacancies.
While marketing is not limited to the internet, it’s important to compile a team of leasing brokers who are well-versed in marketing techniques specifically for commercial real estate and who have a strong marketing department behind them. Depending on the scale of your property, this may include creating online listings for your property, as well as flyers, a top-notch website, videos, events, and more.
3. Your Team Fails to Understand the Specific Market
One of the responsibilities of a leasing team is to possess extensive knowledge about the market in which your property is located. A good landlord broker can answer pertinent questions that may arise in the leasing process – about the average rental rates in the area, for example.
A lack of market understanding will limit the overall persuasive capability of your team, making it difficult for them to close on favorable lease terms. It could make them susceptible to signing below-market deals or offering incentives that are not competitive in the given market.
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4. Your Team Doesn’t Balance the Needs of Property Owners and Tenants
In the strictest sense, the landlord broker’s only allegiance is to the property owner. However, a skilled broker can navigate small conflicts that may arise in a way that keeps both the property owner and the tenants satisfied.
It is imperative that your leasing team has strong interpersonal skills, as these situations can be complex. The leasing team acts as the missing link between the property owners and tenants, so if there always seems to be bad blood between the tenants and the owners, it may be time to re-evaluate the leasing team.
5. There Seems to Be Too Much on Your Team’s Plate
A landlord broker must wear many hats, with responsibilities ranging from landlord’s rep to marketer, with plenty of legwork in between.
The most effective leasing professionals understand the importance of the minutiae and are able to multitask constantly to stay on schedule. That said, the main duty of the leasing team is to achieve at or above market occupancy and rental rates for your property.
If your team becomes overwhelmed with their lesser responsibilities and is unable to meet their bottom line, you may consider either increasing the size of the team or mitigating the responsibilities.
What Can You Do?
If you think it may be time to consider hiring a new broker, the first step should be to talk to your current leasing team. Discuss the situation and find out what they believe the issue is. Are there improvements that need to be made at the property in order to compete? Are they in need of a marketing budget in order to improve their efforts?
Communication is key and once your team is aware of any issues, they should work hard to get them solved.
If that doesn’t solve the problem, it may be time to begin interviewing other leasing agencies.
We have outlined these five signs for you but in reality, every leasing team is different. We recommend talking to your team directly and trying to solve any issues before restarting from square one.
To make sure you hire the best leasing team the first time around, download the 25 Questions to Ask Before Hiring a Project Leasing Broker.