How to Become a Commercial Real Estate Agent
A career in real estate business is a very interesting and lucrative one, yet demanding and challenging at the same time. To be successful you must make prior preparations and be equipped with the basic requirements.
There is a sharp difference between becoming a commercial real estate agent and becoming a residential real estate agent. The two professions are different and their requirements are divergent, as well. Thus, your success in the residential real estate sector doesn’t guarantee success in the commercial real estate sector.
As a prospective commercial real estate agent, you probably have many questions about trading on or leasing of commercial real estate.
In this article, I have provided answers to questions you may have along with all the information on how to become a commercial real estate agent.
Beginning from what a commercial real estate agent is, what the profession entails, personal traits you must possess to be successful, going throught the different sectors or specialty areas in commercial real estate, stating educational requirements, commercial real estate license requirements, the differences between a commercial real estate agent and a commercial real estate broker and possible problems you may encounter as a beginner, I'll provide all the information you're looking for.
What Is Commercial Real Estate?
Commercial real estate is profit–yielding real estate that is exclusively used for business purposes like trade centers, workplace complexes, hotels and apartment complexes. It involves renting out office space, or actual selling of property. A few commercial real estate agents work only on listings, some specialize in tenant representations alone, while others engage in both.
What Is a Commercial Real Estate Agent?
A commercial real estate agent -- also known as real estate associate -- is a certified professional who acts as a mediator between buyers and sellers of properties that are solely meant for commercial purposes.
To become one, you must have taken and passed all mandatory real estate courses and passed the real estate agent licensing exam in the state you intend to practice.
A real estate agent cannot work independently; he / she has to work with a certified broker. A real estate broker, on the other hand, can work independently or jointly with agents and usually requires more education than an agent and must additionally pass brokerage licensing exam.
What Does the Commercial Real Estate Agent Career Entail?
The commercial real estate agent career entails helping clients to procure, sell or rent commercial properties. As a prospective commercial real estate agent, you must be aware that your job can be very demanding since you need to:
- Conduct researches and do investigations about a specific property before you can persuade clients to buy or lease them.
- Give your clients estimation of the price of the property they have interest in with your knowledge of the market and the immediate environment where the property is situated to help them in their decision making.
- Do all the paperwork for your clients.
Personal Traits You Must Possess to Be Successful
If you aim at becoming a successful commercial real estate agent, you must:
- Be capable of working unaided and independently for a long period of time.
- Be endowed with problem solving skills.
- Be persuasive and convincing.
- Have strong self-motivation and enthusiasm.
- Have good interpersonal communication skills.
Educational Requirements
There are national and state requirements for becoming a certified commercial real estate agent. The national requirements are the same all through the US but the state requirements vary from state to state. Thus, your desired specialty area, your personality trait, the brokerage you intend to work with and the state where you intend to practice will all determine what you need as an individual to obtain your goal.
Getting Your Training
Although a college degree is not obligatory to becoming a commercial real estate agent, professional license is mandatory in the entire 50 states of the United States. To get certified, you must pass the licensing exam.
There are a lot of tertiary institutions that offer courses and certificate programs to get you prepared for the licensing exam. Your choice of institution will depend on your state of residence, the state where you intend to practice as well as your chosen area of specialization. Some of these institutions additionally offer associate's and bachelor's degrees in real estate.
The License Requirements
It is mandatory in all the states to take pre-certifying courses but the requirements differ from one state to the other. Your best bet then is to contact the real estate commission of your state for its specific commercial real estate license requirements.
Again, a few real estate brokerages have specific education requirements which may require you to take supplementary courses after you have been hired by a brokerage.
Getting a commercial real estate license requires you to pass state and national exams. You may additionally be required to provide a criminal background check, be over 18 years and prove your legal resident status as well as fulfill all educational requirements.
Different Sectors / Specialty Areas in Commercial Real Estate
This industry has broad categories or areas for specialization. So choosing and choosing wisely is a step towards your career success. Although you can choose to deal with all categories of commercial estate sector, it is much more profitable and advisable to specialize in one aspect of the sector and better still in a specific area of the state than the entire state.
Types of commercial real estate business you can specialize in include the following: central business district, suburban office buildings, heavy manufacturing industrial properties, light assembly, flex warehouse, bulk warehouse, community retail center, power center, regional mall, garden apartments, midrise apartments, high rise apartments, land, green field land, infill land, Brownfield land, special-purpose, self-storage, car washes, theme parks, theaters, funeral homes, community centers, nursing homes, and churches.
What Is a Leasing Agent Representative?
A leasing agent is a commercial real estate agent that has the property listings and stands for the interest of the landlord.
How Are You Paid As a Leasing Agent?
As a landlord’s representative, you’d normally get one-half of your commission when the lease deal is signed and the remaining when the tenant finally moves in. Your commission would usually range from 4% to 6% of the lease’s overall value.
What Is a Commercial Tenant Representative?
A commercial Tenant representative is a certified commercial real estate professional who merely represents the interest of tenants and purchasers of real estate. As a tenant representative, you stand for the interest of the tenant during property leasing. This essence of this is to ensure that there are no conflicts of interest between the landlord and the tenant.
As a commercial tenant representative you’d carry out site inspections, market rate comparisons and tenancy term comparisons to provide buyers with the best price and terms possible as well as craft Letters of Intent when tenants and buyers had made their choice.
Your Work Environment
As a commercial real estate agent you’ll work with an estate broker. You must make researches before choosing the brokerage to work with. Check their credibility and reputation.
Your Compensation
According to Occupational Employment and Wages report of the U.S. Bureau of Labor Statistics, the average yearly wage of commercial real estate agents is $53,140; the great majority of this comes from commissions.
You’d earn more as you grow and become more experienced. As a beginner, you may work for weeks or months without sales or leases which could prove very challenging, but perseverance is the key to success.
Summary
Your success rate all boils down to obtaining accurate information on how to become a commercial real estate agent beforehand, possessing the required traits, the environment you have chosen to work in, your chosen specialty area, the brokerage you partner with, your hard work, getting the required education and licensing amongst other things.
Having provided answers to questions you may have and giving you all the necessary information you need, the ball is now on your court. So, go ahead and keep the ball rolling; ensure you score the goal! Put into practice what you have learned and good luck!
