RCA Technology & Intelligence Briefings Issue 3

Interview with Mike Lipsey — Second Quarter 2006

Mike Lipsey is president of the Lipsey Company. He is a nationally and internationally recognized leader in training and consulting for the commercial real estate industry. His insight into the business of commercial real estate spans more than thirty years. Several of his programs have become industry standards such as BOMA’s Boot Camp and IFMA’s FM 101, 201 and 301 series. His meaningful programs and practical solutions have been recognized as providing immediate and measurable results for practitioners and their clients. Contact him at mike@lipseyco.com

1. Those who are consistently top producers work in teams (typically 3–8 members), delegate responsibility to team members, leverage technology and take a consultative (rather than transactional) approach.
2. About 30%–40% of their revenue each year comes from non-transaction activities—consulting is part of their development of long-term relationships.
3. They are thorough in their understanding of clients’ objectives, and they use all sources of technology to stay in touch with clients, keeping them informed of progress.
4. Some solo practitioners with just modest administrative support have done enormously well financially in the last 2–3 years, but clients tend to get more comprehensive service from teams; if a client’s need is very specific (a simple sale or negotiation of a lease), a solo broker may do an exceptional job.

1. The primary expectation should be accountability, but some brokers give ambitious listing presentations, take the listing and then under-perform; there is no measurement or accountability.
2. Landlord representatives need to make specific commitments about how often they will show a property and what results should be expected in terms of proposals and letters of intent; if those expectations are not met, then adjustments in the brokers’ practices should be discussed with the client.
3. Too often, a For Sale or For Lease sign is the most active part of the marketing campaign; the old technologies of signs and brochures are not enough.

1. Commercial agents are using a variety of contact management software (CMS) ranging from Outlook and ACT! to sophisticated, customized intranet systems—the critical factor is to fully employ whatever software is in place so that everything from contact notes to letters and contracts is attached to a contact’s record.
2. Besides being used as a comprehensive repository for contact information, a CMS should be used to set up and implement follow-up campaigns; effective use of a CMS is a major organizational tool that can save the agent time and frustration.
3. Some commercial agents are gifted with sales and social skills but lack administrative skill—they often have a fully-loaded PC sitting on their desk unused; they should partner with a technician who can put together an infrastructure to support their commercial real estate success.

1. A strong, capable broker should have at least one strong technician who can maintain a database and PowerPoint presentations and manipulate spreadsheets (e.g., ARGUSTM, ProCal or MS Excel); these people may be licensed but have no interest in selling—serving as back-office support is an alternative way for them to participate in fees and commissions.
2. The “perfect team” depends on the size of the market and the size of the portfolio an agent is working on; teams often consist of four to six members—specialized people to prepare packages, perform administrative detail, arrange travel, contact sellers, contact investors, conduct research and analysis, etc.
3. Two high-performing brokers working together do not constitute a team; they represent a partnership, and they still may be highly dysfunctional in attending to detail; creating a team requires evaluation of what functions need to be accomplished and then finding players with the right capabilities.
   

1. Be patient—“There is always another streetcar;” don’t think that any one deal must be made.
2. Don’t get emotionally involved in the set of circumstances you are dealing with; stay focused on the facts and don’t let your ego interfere or your feelings get hurt.
3. Know at what point you should walk away; if you walk away, leave the door open for doing future business.

1. Always do research before you call a prospect; you will have better success with people if you are prepared to share significant information—know what is important in that prospect’s business and share something of value in light of that (how you can help them).
2. Treat all receptionists/gatekeepers with the utmost courtesy and respect; share thoughts with them as though you had a decision-maker on the phone; be relaxed, comfortable and confident on the phone so that your natural sociability shines through—aim to stand out from the many other calls the gatekeeper screens.

1. A good product for getting email contact information is ListGrabber, which can retrieve contacts from any digital database, organize them and integrate them into your own database.
2. Spend some quality time to develop your database—send a preliminary message to new names requesting permission to send them information (allowing them to opt-in); names should need to be entered digitally just once—after that, no further paper should be required.

1. BizStats.com is an incredible web site that offers information such as rent-to-revenue ratios, operating information for private and public companies and much more, including sophisticated comparisons and analysis
2. Score114.org is a site that gives operating ratios and other insightful information about small, private businesses; BizStats and Score 114 are great research tools to use before calling prospects and while advising clients.
3. 10K Wizard has powerful search capabilities for SEC filing information, but one side of the transaction must be public; at $175/year (first 30-days free), it is a good value.