The Importance of Interpersonal Skills in Brokerage: Locally Focused Advisors Retain an Advantage in a Global Capital Environment

Over the past decade, the New Jersey commercial real estate market has seen record growth due to its strategic location as the staging area for goods being shipped to New York City, Philadelphia, the northeast corridor, and the rest of the country. As shipping volumes and property values increased, institutional capital has increased its share of both real estate ownership and commercial occupancy in the market. While some firms have responded to these shifts by deploying larger, corporate teams to address the market, The Blau & Berg Company has maintained its nine-decade advantage by emphasizing local knowledge and interpersonal relationships.

Real estate is an important part of the supply chain, but it is not often the most critical component. E-commerce companies and their logistics vendors will pay more for state-of-the-art facilities in key locations because the order fulfillment volume and efficiency created by these facilities offsets their relatively high costs. This means that brokers, investors, and property developers need to understand that tenants who make multimillion dollar occupancy decisions often have many other considerations besides rental rates, operating expenses, and other metrics that real estate professionals live and breathe. In brokerage, those who have the most success understand that is the ability to anticipate and empathize with the business pain points of their clients will go further in moving along a deal than those who show up and recite market statistics that might not contribute to a decision.

According to Statista Global, the worldwide value of real estate is expected to reach $637.8 trillion by the end of this year- the size of 25 economies with the GDP of the United States. The sheer size of global real estate investment throughout the world obscures what a hyperlocal business real estate really is. Industries that are heralded as employment generators in Middlesex County must fight for diminishing amounts of space if they instead prefer to situate in Hudson County. Townships that once welcomed industrial real estate development as a source of jobs and tax revenue now look for ways to constrain that development as they seek to conserve electricity and mitigate buildings they see as eyesores. It is the well-connected, local market expert who knows better than business owners themselves which counties and municipalities would be ideal for their business operations, and how best to make the case to local policymakers if the status of a project is up in the air.

It is tempting for brokers to commiserate with their clients about changing political environments, but the best brokers are those who show up at town halls, chambers of commerce, and political events to understand the competing land use priorities that elected officials deal with. These brokers deploy the same empathy to land use decision makers as they would to their clients, not because we share their views, but so that we can be more effective advocates for getting deals done.

In a world of consolidation, “bigger” does not always mean “better”. It is the brokers who listen to their clients, industry influencers, and government officials so they can have their finger on the pulse of the market and development climate that get things done for the business operators who count on them.