Building referral relationships is an essential part of growing any business. This is especially true of the very competitive serviced office center industry. It says a lot to the prospect when the services of your business center are recommended by someone directly. Conventional real estate brokers and agents are great referral partners for business centers. Here, I’ll share how to develop relationships with conventional brokers in your area that lead to more sales success.
Let’s start with the mantra of the world’s largest business networking organization, BNI, “Givers gain.” When seeking referrals, it’s chiefly important to remember that the more you give the more you gain. So, before you request your first referral, fully evaluate your referral incentive program and know how to communicate its value to the conventional real estate professional. Typically, referral programs pay based on the total value of the business over the first year. Conventional commercial real estate salespeople are used to being paid a commission on leases that can extend much longer than a year. So telling them they get a percentage on the first year’s fees may not be that appealing to this particular referral source. A better option is to give them a range of the dollar amounts yielded by the simple act of referring a customer to your center. That way they can weigh that amount apples to apples against other transactions.
In many jurisdictions, it’s illegal to pay a real estate agent or broker directly for transactions related to the business of real estate including referrals. By law, their principal broker must be paid and then issue a check to the agent or associate broker. Most shared workspaces (business centers, executive suites, coworking centers) sell licenses to use a services under a License Agreement rather than a lease, so these laws against providing a referral incentive directly to agents and brokers do not apply. This is a helpful bit of information is great to share as your engaging with agents and brokers. They may be hesitant to accept your incentive for fear of disciplinary action. However, explaining this distinction between what you offer and what they offer will alleviate those concerns and bring added appeal to the relationship since there’s no middle person involved.
Another advantage for the conventional broker to refer your services is having the opportunity to offer more fitting solution for a budding business in order to maintain the relationship when their real estate needs and/or budget grow. Business centers are a great option for entrepreneurs to build the budget and client-base that require a full-time brick and mortar location. When conventional brokers can refer your center to that business in the meantime, they get to build their image as a problem solver and work space services expert to the prospect. And, in this way, plant the seeds for business in the future.
I have found that one of the best times to focus your marketing to conventional real estate professionals as referral sources is during the winter holiday season for two reasons. One, this is a slow time of year for conventional real estate brokers and agents. People usually don’t make the decision to re-house their business at the end of the year, so prospects well suited for office leases and sales are scarce. You can send out promotions for them to revisit old prospects with too small a budget or office need than what they could work with and invite them to send them your way. This way they could earn some extra cash during this financially demanding time of year. Just after the New Year is resolution season. Many entrepreneurs reach out to conventional brokers and agents to take their business to a new level. They can turn all of their new prospects in to customers no matter their budget when they have the business center option to refer.
Now that you know a little more about the advantages of building referral relationships with conventional real estate brokers and agents, pick up the phone and give a few a call. Get them to know, like, and trust you; educate them about your services and referral program; and, really grow that strategic partnership for benefit of both businesses. Call Workspace Strategies team anytime for more advice on this topic or any related to growing your Center’s prospects.
About the Author
Karen Condi is the president of Workspace Strategies, a workspace services industry leader. Workspace Strategies, Inc. is an executive suite management company comprised of seasoned property management and business professionals focused on assisting property owners achieve maximum value from their real estate investments. Offering a broad range of services, Workspace Strategies’ unparalleled experience in developing, opening, managing and turning properties around enables The Company to achieve extraordinary results for their clients.
We take the challenge of turning your property into a world class executive suite driving immediate equity and profit. In this difficult economy the rules have changed, calling for new choices — new alternatives. It is essential to be fast, forward thinking, and a cut above the competition. This strategic advantage can only be supplied by organizations that provide cutting edge, high-tech solutions through the most effective methods.
Workspace Strategies was formed to help provide these solutions. By utilizing the top skills and experience in the industry, Workspace Strategies assumes an unparalleled posture to provide all aspects of executive suite management to the marketplace, from turning around a struggling location to developing new properties. These skills and experiences are constantly being honed by working with the top executive suite properties and property owners.
Workspace Strategies grew out of the need to meet the fast growing market demand for a unique set of services, development and management of executive suites. Workspace Strategies’ founders realized this need which was propelled by expanding market demand and opportunity.