Unlocking the Power of Pattern Recognition in Commercial Real Estate Transactions
As a commercial real estate professional with years of experience, I have developed what I believe is a keen sense of “pattern recognition” when it comes to identifying opportunities and potential issues in commercial real estate transactions. Too often residential and commercial real estate brokers allow themselves to be commoditized and seen mostly as “space finders.” Sadly, for many that is all they do. But to be seen as an expert in your industry that provides true value to their clients beyond finding a space or a tenant it takes time, effort, and lots of repetitions. My 20 years of wins and failures allows me to assess a property, a deal, or another person’s behavior more quickly and accurately so I can make informed recommendations to my clients.
What is Pattern Recognition?
Pattern recognition is the process of identifying patterns, regularities, and relationships in data and behaviors. In commercial real estate, this involves recognizing patterns in market trends, property data, and the human element of negotiations.
Why is Pattern Recognition Important in Commercial Real Estate?
Recognizing patterns is critical to making informed decisions and anticipating future trends. By identifying patterns in market data, you can better understand market conditions and provide your clients with informed recommendations. Additionally, recognizing patterns in your clients’ needs and preferences can help you provide tailored solutions that meet their specific requirements.
One of the key ways in which my pattern recognition skills have developed has been through sheer repetition as well as the variety of deals I have transacted. I represent landlords, tenants, buyers and sellers of office, and warehouse properties. During the course of a deal, we see people at their best and at their worst and over time trends tend to emerge and we are able to make recommendations to clients that can help circumnavigate obstacles preemptively. In my previous career as a competitive rowing coach, I was in the business of putting athletes under pressure as a part of their training. This also gave me the opportunity to observe human behavior that I regularly bring to bear for our clients. This diversity of experience has given me a broad understanding of the many factors that can impact human behavior and commercial real estate negotiations.
Real estate deals are largely driven by the numbers; cap rates, rental rates and proforma’s. But there is a significant human element to getting deals done as well. Paying the asking price doesn’t always win. If you have multiple offers, being able to read the behaviors and intent of the buyers is important. Helping your client pick the buyer that will close and not re-trade you is invaluable. Knowing when you have hand and leverage and when to play it is not taught in real estate class. Only time and repetitions give you the confidence to tell your client when they can go low and when they need to pay full price!
An experienced broker can save their clients time and money to make informed and confident decisions about their commercial real estate investments.
Overall, my ability to recognize patterns in commercial real estate transactions is a significant benefit for my clients. It allows me to provide them with valuable insights and recommendations that can help them to achieve their goals and succeed in the competitive world of commercial real estate.
Mike Porterfield is commercial real estate advisor with twenty years of experience in the Northern Virginia market. You can find him on Instagram @theCREbroker. Tartan Properties Commercial Real Estate Services is an independent commercial real estate brokerage and consulting firm focused on office, industrial, and flex properties that provides creative and professional solutions for its clients’ real estate needs. On all platforms @tartanproperties
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