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Do We Have a Crystal Ball in Commercial Real Estate?


Obviously, the answer is no. Unfortunately, when it comes to investment properties it feels like our clients think we have one and can predict the outcome of their investment. We can do all the research and present the stats and what we think, based on the data, what we think will happen, but there are a multitude of things out of our control.



Recently, we had a client that purchased their first commercial investment property. It seemed like a slam dunk because we put a tenant into the building the same day as closing. No down time at all. The tenant seemed like a good tenant, the financials were presented to the landlord (old and new) and it was decided to move forward. That was pretty much the highlight of the story because there was a falling about among the partners and the one with the funding left resulting in a failed business that moved into the space and had begun to make tenant improvements but wasn’t even able to finish them.


The Landlord opted to release the tenant from the lease and move forward finding a new tenant. If you’ve seen our emails and social media and marketing materials, you know that we have a very active marketing team, which I believe is the best in the business. Part of the reason for that is that we include our marketing team in property discussions and strategy development, plus the see the properties firsthand and understand what needs to happen to get a property moved. But that is neither here nor there.



A few months have gone by and there is no new tenant in spite of our proactive marketing efforts. We provide monthly updates and insights to the owner. The stats are now saying, based on historical data, that it could take 7-12 months for this vacancy to fill. That is not the news we want to deliver. We believe that if anyone can find a tenant sooner it is our team, but we can’t promise that. That is where the crystal ball conversation comes into play. They want us to be able to promise that we’ll get it leased this month. We just can’t do that. All we can promise is that IF there is a tenant looking at properties like this one, we will find them. If the demand isn’t there, we can’t find the tenant. We can double check this by looking at the leases that have been signed over the past few months and if those properties were in the same price range, same size, similar features and we didn’t get them then we missed an opportunity. But that is not the case here.


Here's the other thing. We enjoy working with our clients and we strive to help them achieve their real estate goals. We do take it personally when we encounter challenges and invest ourselves into trying to find the solution that will get them there.



So, if you ask us to look into that crystal ball and predict what will happen with your property, the answer is that I can say with 100% certainty, we will work harder than anyone else to reach anyone that could possibly lease your space and when we do find them, we will negotiate to get the best deal done for all parties involved so you can have a long-term tenant and a great income producing property.

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