A Broker for a Broker.

[Daray Olaleye]

Hey BP family - Sometimes as newbies we get caught up in take take take because we feel as though we have little to no value to give. That's another story for another time but my question does stem from it: Is it common practice for investors to exchange commercial brokers (contact information)? An "If I give you my A-rated brokers list, will you give me yours" type of exchange. Better yet, "I just started - I don't have a brokers list, so I don't have good deal flow. Do you have any recommendations?" I'm sure brokers love to be marketed by word of mouth, but do investor like to give up their sources? I guess it would depend on whether one has an abundance mentality or not, but I'm really just asking what common practice is and if I should think twice before asking an investor to put me in touch with some good brokers with nothing to offer in return. I'm interested to see you guys' thoughts. Thanks BP family!

[Salvatore Lentini]

Hi @Daray Olaleye - The issue really isn't really whether other investors will give up their brokers.  The issue is getting brokers to take you seriously.  I speak from experience.  I called around to a ton of commercial brokers in years past.  Never heard from any of them again beyond our initial call.  Then once I had some commercial deals under my belt, my email starts dinging and my phone starts ringing.  The reason is, there are LOTS of tire-kickers out there.  And even if many of them are looking with the best of intentions, in the end if they've yet to take down a commercial deal, the odds of them doing their first with that particular broker are slim.  Brokers only have so much time in a day between finding deals, working up the numbers, marketing, talking to buyers, showing properties etc.  So, in their world they are looking for ways to be more efficient and close more deals.  How do they do that?  By going to their buyers that they know have the ability to buy and have already done so in the past.  A lot of commercial deals are pocket listings, meaning they are never publicly marketed.  They get a property and instead of blasting it out to everyone and posting it on different sites, they contact a handful of their "likely" buyers.  This prevents them from having to talk to tons of unlikely buyers and gives them the chance to get both sides of the commission.  Make sense?  So you need to make sure you know the lingo.  That will get your foot in the door.  Partner up with someone that has done some deals already so that you can legitimately say "We've purchased/rehabbed/developed X number of properties".  Even if you don't end up doing a deal with that "partner" you'll at least get your foot in the door and you'll get some callbacks.  Even then, until you've done a deal with THAT particular broker or agency, you won't be top of mind to let you peak inside "the pocket".