It is an understatement to say that much has changed over the past 30 years in the real estate industry. But one element that remains constant in any business is the need to preserve successful client relationships through ongoing and effective communication.
Piers Chance, vice president and director of management services in the Dallas office of Grubb & Ellis Company, says today’s real estate firms should be focused on maintaining and improving communication policies, both internally as well as with their clients.
Smart Business spoke to Chance about lessons learned in the real estate industry for building stronger bonds with clients and why communicating effectively within your own organization helps you to better serve — and keep — clients.
What kind of communication should clients expect from real estate professionals?
Understanding clients’ objectives in the first place, in addition to their goals going forward for a particular site or assignment, is critical. I continually remind our property managers to stay in tune with their asset managers regarding their investment strategies, operating directives and timelines for holding and ultimately disposing of the property.
True professionals should stay current on market conditions and trends and be able to help develop strategies for clients to take advantage of them. They should go the ‘extra mile’ to understand and help accomplish a common goal, even if it’s not part of the overall assignment or compensation agreement.
How do these communications strategies apply to other client-based industries?
Client contact should be required on a regular, scheduled basis as opposed to at random or as issues arise. It’s too easy to take relationships for granted when things are going well or placed on autopilot. It only takes one glitch or missed communication to appear on the competition’s radar screen, particularly in this economy. Regardless of the client’s location, East Coast, West Coast, Europe or next door, reaching out to say, ‘Hello, how are you and — more importantly — how are we doing?’ indicates that the client is on the forefront of your business plan. Computers, laptops, BlackBerrys and cell phones are great tools, but they are secondary to personal contact and old-fashioned handshakes.
What is a common mistake that property managers make when communicating with their clients?
Problems can arise from, again, forgetting the importance of regular communications, as well as failure to establish open dialogue regarding significant site issues. Property managers should always be ensuring that there are ‘no surprises’ and should not allow the asset manager to be caught unaware of a particular situation that may have a negative impact on the project. The more effective the communication process, the stronger the relationship and comfort zone for all concerned.
Some members of management can have a difficult time delegating and allowing their team members to communicate more closely with the client. A lot of my compatriots have a fear factor that if they’re not in the middle of everything then they don’t know what’s going on. But you either hire the right people, trust and depend on them or not. If a client can’t contact me, I certainly don’t mind their picking up the phone and calling the on-site manager to get the answer instead of waiting for me to get back in my office. Problems can pile up when management does not:
- Delegate or allow on-site team members to communicate directly with the client in the absence of the manager representative assigned to the account.
- Stay current on all aspects of the property’s marketing, operations and financial conditions in the market.
How does improving communications inside a company improve relationships with clients?
At Grubb & Ellis Company’s national meeting in February this year, the directive was to break down the old ‘silos’ regarding transactions, brokerage, property management, investments, etc. Past history in our business has shown that these groups pursued their own endeavors or goals without thought to other inter-departments.
Grubb & Ellis Company’s internal motto has become ‘One team, one goal,’ meaning we are partners with one another as well as with our clients. If companies can marshal all their divisions and talent into one collective effort, it creates a tremendous advantage for clients through ‘cross-selling.’ In the real estate industry, if one organization is doing the leasing, the management and the construction management, the client only has to deal with one company. It improves the coordination and commitment of all endeavors.
When a company is committed to multiple aspects of a client’s project, it knows what the client can afford and can suggest ways to improve its strategic plan. For example, a real estate company can make better leasing decisions and make better projections for capital expenditure because it’s been working with the client in all of those aspects.
What can companies do to ‘break down silos’ and create good communication practices?
Mandate that all department heads within the company:
- Hold regularly scheduled meetings throughout the offices in key office locations with all groups, i.e. leasing, brokerage, research and marketing, property management, etc. This ensures that everyone is aware of everyone else’s ongoing activities and potential for new business that could overlap into their areas.
- Develop attractive compensation incentives in the form of referral fees for new and ongoing business development with other divisions or disciplines. As always, nothing motivates success as much as the reward element, monetary or otherwise.
Piers Chance is vice president and director of management services in the Dallas office of Grubb & Ellis Company. Reach him at (972) 450-3232 or [email protected].
