Often times in the marketplace of Commercial Real Estate firms many ponder the question, should I choose a national firm or a boutique firm? How should I decide and what factors should I consider?
FIRST, Technology has made a huge difference in the real estate marketplace. Firms of all sizes have access to similar modalities, whether it is a listing service, a database, mapping tools, gap studies, needs analysis, financial modeling, social media, research and analysis, and the list goes on. This advancement alone makes the playing field highly competitive among all sizes of brokerages. No longer do national firms separate themselves from boutique firms in this arena since most are staying on the cutting edge of these technologies.
SECOND, the Network of buyers is no longer limited to nationals. Access to these buyers with all the previous tools mentioned is no longer limited to a select few firms. A boutique firm that is disciplined in the marketplace has the same market presence as their largest competitors.
THIRD, Commercial Real Estate Organizations are open to all brokers and now firms of all sizes are creating cultures that require involvement in these organizations. Some of these include NAIOP, SIOR, CCIM, ICSC, Retail Live, CFCAR, and others. These organizations thrive on the concept of networking and usually involve the best in class for all brokers no matter the size of their organization. Many transactions result from participation in these highly organized groups that foster relationships and deal-making sessions.
FOURTH, Specialization in a sector of commercial real estate used to be a differentiator for national firms. They focused on creating experts in each discipline to include Retail, Industrial, Office, Multi-Family, Investment, and Land. Boutique firms in large and tertiary markets are deploying a highly specialized group of real estate brokers that are the local experts in each discipline.
FIFTH, Teams are a must in commercial real estate today. The solo practitioner is becoming obsolete since the demands due to technology and the needs of clients are more complex. This has been a standard practice of national firms, as they understood the value of teamwork. Boutique firms have long been committed to this strategy in the marketplace and are executing teams with excellence. Many principals with local firms learned the business prior to starting a boutique firm from being team members on a national firms team.
SIX, Local Knowledge is often times dominated by a strong local boutique firm with excellence in some of the core competencies mentioned above. The local firm is usually plugged into the local economy, the growth, jobs, new developments, local and state trends and drivers in a specific geography. Local specialized Brokers with tenured local market knowledge are the most effective in a specific marketplace and will produce the desired result more often due to an insider’s perspective.
SEVEN, Boutique firms tend to be less driven by the volume or size of a transaction fee and rather driven by the development of a long-term relationship no matter the size of the fee. They tend to be driven first by service, relationship, and solution rather than the size of a transaction. They are accountable first, long-term to their client rather than an out of state headquarters quotas.