Whenever you’re going after a new commercial real estate listing, always begin by asking the owner for what you believe could be the maximum amount of commission that could be warranted, for a transaction of this size within your territory.

Normally the only exception would be if you’re dealing with an owner who has a customary rate that they always pay agents, and you agree that this rate is acceptable to you.

I’m bringing this up because so many agents begin their negotiations by already discounting the amount of commission that they are willing to list a property for, and brokers need to understand that whatever the initial commission rate is that you are proposing to your owner, this oftentimes then becomes the rate that the owner will now begin to negotiate you downward from.

So with this being said, when you begin by asking for a higher commission rate, and you have become good at negotiating for your commission, the chances are better that you will walk away with getting a better commission rate in the end, as compared to if you had begun the negotiation by offering them a lower rate.

As brokers, we are oftentimes dealing with principals who are sharks in commercial real estate, and these sharks want blood.

So begin by asking for the highest commission rate that you think could be reasonable for the size of the transaction, and be both fully prepared and well-rehearsed to discuss why you believe this commission rate is warranted, including telling them all of the things that you will be doing to sell their property for the highest price.

Because when you are both congruent and certain in your presentation to them for this, you will oftentimes then get the owner to agree to a higher commission rate than they had originally planned on, because your certainty and your congruence in your presentation is now getting them to question whether the lower commission rate that they had been thinking of, is still warranted.

But many commercial real estate brokers won’t stand firm like this, while then ultimately in the end, maybe yielding just a little bit in the commission amount if they have to, and your owners will then respect you for being this person.

With this in mind, if you then give in just a little bit, the owner will feel good that they’ve at least gotten a little commission out of you, but they will also respect the fact that you have a spine as a broker, and that you are willing to stand firm, which can then reinforce the feeling that they’ve chosen the right agent who will now negotiate firmly for them.

Ideally, you want to present yourself as being a highly-professional agent, and as being the greatest class act within your market, because that kind of agent is the one who will negotiate firmly like this, and ultimately, this is the kind of agent that your clients and prospects really want to have representing them.

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If you’re interested in becoming more effective with your prospecting, getting more listings, and closing more deals, and you’d consider doing one-on-one coaching together to make it all happen, send me an Email or give me a call! “

“Jim has helped me to really catch on fire with doing my prospecting, and he’s helped me with the right scripting to get my prospecting done, too. In addition, he’s shown me even more effective ways of scheduling meetings with people, and as a result I’m now landing a ton of new listings!”

Matt O’Rorke
NAI