Prospecting Hfm
Your first step in prospecting is to target a market (or, possibly, a few markets). Especially in commercial real estate, it is very difficult to be everything to everyone. Trying to cover numerous types of properties will cause you to try to be an expert in many areas and you may end up not being an expert in any one of them. For example, if you are dealing mainly with Class A or B high-rise office buildings, you probably would find it difficult to be an expert on garden apartment buildings. This is not to say you should not try to broaden your horizons, just be careful you do not try to go too far too fast. You might broaden your practice to include all kinds of office buildings or to include multi-use buildings since then your experience with Class A or B high-rise office buildings will be helpful. However, adding small retail strip shopping centers to your listing portfolio would be riskier.
Top-Tier Tenants: Gucci
The Gucci flagship store in Manhattan occupies a prime piece of New York real-estate— the corner of Trump Tower and three floors of storefront space. Gucci is located in perhaps the most upscale retail neighborhood in New York City, with existing stores such as Bergdorf Goodman and Tiffany and planned locations for Giorgio Armani and Hugo Boss all close by. The store's interior design calls to mind Art Deco. Gucci products include jewelry, apparel, and accessories and merchandise, much of it exclusive to Gucci Fifth Avenue.
Primary target customers include wealthy residents and wealthy visitors. However, some real-estate observers interpret Gucci's move to Trump Tower as a way to broaden their clientele. According to Ben Fox, head of Winick Realty Group, "To be on Fifth Avenue is center stage in the world marketplace. . . . If you're looking to broaden your audience, you go to Fifth Avenue as opposed to Madison."
Brokers estimate that it cost between $50 and $70 million to build and that the rent is in excess of $20 million per year for about 46,000 square-feet. They think that potential annual revenue may be more than $100 million.
Source: "Gucci Pays Homage to Couture,"7fte Real Deal, March 3, 2008.
Recall the discussion in Chapter 13 concerning growth and risks. Those ideas apply here as well.
Gucci at Trump Tower.
Photo credit: Ali Goldstein. Photo courtesy of The Trump Organization.
Gucci at Trump Tower.
Photo credit: Ali Goldstein. Photo courtesy of The Trump Organization.
In general, prospecting for commercial clients involves the similar types of sources discussed in Chapter 29 on implementing your residential real-estate marketing plan. (For suggestions on finding prospects, see Fisher, 3 Bowman,4 and Lindahl.5)
Sources of prospects include:
• Expired listings
• Centers of influence
• Newspapers
• Real-estate publications
• Advertisements
• Yellow pages
• Tax rolls/owner lists
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