Know your markets
Obviously, you have to know what’s happening around you in order to recognize — not to mention tap into — any opportunities.
D’Arcy’s understanding of the external marketplace comes from parts of the company that are immersed in the outside world. Grubb & Ellis has 100 research professionals scattered across the country, all led by a chief economist.
In each market, researchers keep a close eye on the local ins and outs of the industry — including vacancy rates, rents, sale prices, new developments and new tenants moving in.
“At any point in time, you can get onto our website and you can drill down into the markets and submarkets,” he says, referring to the Metro Trends quarterly reports that include analytical commentary and detailed graphics. “So in almost every market and large secondary market and every asset category, we’re providing real-time research. That’s one of the differentiating factors for us as a company.”
D’Arcy strongly prefers the company’s research capability to the secondhand knowledge leaders get by taking someone else’s word.
“The key is that we’re not just purchasing third-party research, nor are we simply regurgitating what we see in the popular press,” he says. “These folks live in these submarkets and understand these submarkets as well as anybody. It’s all about being local. The closer you are to the market, the better off you are.”
Brokers can then pass that detailed information on to clients. So if a corporate client is considering relocation to a new market, Grubb & Ellis can fill the company in on what’s happening there in terms of rent, vacancies and comparable transactions.
“That’s one of the things that clients are looking for, is that industry knowledge on a market and submarket level,” D’Arcy says. “It’s a clear resource for our brokers as well as for me personally; it’s an opportunity to always keep my pulse and know what’s happening in the marketplace.”
While the local origination of your market research is crucial, that micro-level information can also feed your macro-level understanding — thereby fueling broader decisions you may face. By pooling together local data, you can start to identify broader trends.
D’Arcy, for example, can extrapolate the big themes in retail and industrial spaces from individual market trends. That way, when he decides where to allot additional resources, he has a wealth of information about growing areas of business to back him up.
“When we’re making decisions, we’re making really deeply educated decisions about what’s happening in terms of the trend lines in the commercial real estate market,” he says.
