how feasible is a career shift into commercial real estate at forty?
September 11, 2012 10:52 AM Subscribe
Just turned forty and thinking about a potential career shift into commercial real estate in the Bay Area. What do i need to know?
Response by poster: I am not currently licensed and these are the first steps towards figuring out of its something i would like to pursue. So I'm looking to gather more information on the different paths available and hopefully get some first hand experiences from people who have made a similar switch.
posted by zeoslap at 11:18 AM on September 11, 2012
posted by zeoslap at 11:18 AM on September 11, 2012
Any real estate career is going to be commission only. Can you go for months even years without a check?
How is commercial real estate vacancy in the Bay Area? If occupancy is high, 90%+ then there's not much to sell, hence not a great opening for you. I believe that San Francisco has the lowest Retail Vacancy rate in the country with just 3.7%.
What is it about Commercial Real Estate that sounds good to you? Most Commercial Real Estate transactions are for rentals, not purchase. Does that make a difference to you?
I knew someone who worked in Commercial Real Estate and thank goodness his wife worked because he never sold or rented one square foot in over two years.
It allowed him to play a lot of golf though.
posted by Ruthless Bunny at 11:31 AM on September 11, 2012
How is commercial real estate vacancy in the Bay Area? If occupancy is high, 90%+ then there's not much to sell, hence not a great opening for you. I believe that San Francisco has the lowest Retail Vacancy rate in the country with just 3.7%.
What is it about Commercial Real Estate that sounds good to you? Most Commercial Real Estate transactions are for rentals, not purchase. Does that make a difference to you?
I knew someone who worked in Commercial Real Estate and thank goodness his wife worked because he never sold or rented one square foot in over two years.
It allowed him to play a lot of golf though.
posted by Ruthless Bunny at 11:31 AM on September 11, 2012
Response by poster: Going months wouldn't really pose a problem, years would though.
posted by zeoslap at 11:41 AM on September 11, 2012
posted by zeoslap at 11:41 AM on September 11, 2012
What's your network like? I know a little bit about commercial real estate and investment real estate because of some clients, and I do know that at least in this city, commercial real estate is based on relationships and word of mouth. Another channel is email, although from an online marketer's perspective, email tactics (as well as commercial real estate websites) are pretty unsophisticated. Anyway, when people look for a place to locate, they tend to phone someone up, so having that network, or the ability and means to build a network, is going to be pretty important.
posted by KokuRyu at 12:22 PM on September 11, 2012 [1 favorite]
posted by KokuRyu at 12:22 PM on September 11, 2012 [1 favorite]
I think the important characteristics of that work are:
- Cyclical business
- Commission only
- Takes a long time to build up a reputation, clientele, referrals
- Requires tenacity, patience, resilience, and great people skills
So it seems that it's a line of work that takes a long time to get established in, with a lot of volatility along the way, so it's important to make sure you are cut out to handle those characteristics of the work and also have the right attributes for being successful at it.
posted by Dansaman at 1:04 PM on September 11, 2012
- Cyclical business
- Commission only
- Takes a long time to build up a reputation, clientele, referrals
- Requires tenacity, patience, resilience, and great people skills
So it seems that it's a line of work that takes a long time to get established in, with a lot of volatility along the way, so it's important to make sure you are cut out to handle those characteristics of the work and also have the right attributes for being successful at it.
posted by Dansaman at 1:04 PM on September 11, 2012
It also doesn't seem like it would be a particularly fun line of work, unless you were in the business of managing the property (and even then...).
Compared to residential real estate, commercial real estate has a lower amount of emotion - companies are looking for a good deal on wherever they are located, and they are also looking for good services to go along with the lease. They may be willing to pay for intangibles that enhance their prestige, but at the end of the day (or the quarter) and accountant or VP finance is going to look at the numbers and ask whomever to defend the decision to stay located where they are.
On the landlord side, there is the constant pressure to somehow increase revenues and profits per square foot of space. I suppose you can do that by getting overhead down if it's an office space, but there aren't many options....
posted by KokuRyu at 1:36 PM on September 11, 2012
Compared to residential real estate, commercial real estate has a lower amount of emotion - companies are looking for a good deal on wherever they are located, and they are also looking for good services to go along with the lease. They may be willing to pay for intangibles that enhance their prestige, but at the end of the day (or the quarter) and accountant or VP finance is going to look at the numbers and ask whomever to defend the decision to stay located where they are.
On the landlord side, there is the constant pressure to somehow increase revenues and profits per square foot of space. I suppose you can do that by getting overhead down if it's an office space, but there aren't many options....
posted by KokuRyu at 1:36 PM on September 11, 2012
The term "commercial real estate," as it's usually used in the industry, refers to larger (5 units or more) apartment buildings, shopping malls, stores, and warehouses that are bought and sold for income and profit. In other words, stuff that investors buy. It's a specialized field, with relatively few players. Almost all are corporations or LLCs.
You're better off in not limiting yourself to "commercial real estate," but launching into real estate in general, teaming up with a company where you can do a panoply of things--from renting apartments for landlords, to property management, to selling condos, to selling commercial properties eventually. Try not to limit your options at first. And maintain an alternate source of income during the initial lean years.
posted by Gordion Knott at 1:36 PM on September 11, 2012
You're better off in not limiting yourself to "commercial real estate," but launching into real estate in general, teaming up with a company where you can do a panoply of things--from renting apartments for landlords, to property management, to selling condos, to selling commercial properties eventually. Try not to limit your options at first. And maintain an alternate source of income during the initial lean years.
posted by Gordion Knott at 1:36 PM on September 11, 2012
My honest opinion is that unless you want to do this for a hobby, and you have a steady stream of other income, this would not be a profitable indeavor.
posted by Ruthless Bunny at 1:57 PM on September 11, 2012 [1 favorite]
posted by Ruthless Bunny at 1:57 PM on September 11, 2012 [1 favorite]
Best answer: Commercial real estate encompasses many fields of expertise: brokers, leasing professionals, investment counselors, asset managers, appraisers, corporate real estate executives, property managers, developers, institutional investors, commercial lenders, attorneys and bankers, to name a few.
You don't have to be a member of the Certified Commercial Investment Member Institute, an affiliate of the National Association of Realtors, to access their publication, Investment Trends Quarterly. You could learn more about the field by reading current and back issues.
posted by Short Attention Sp at 3:11 PM on September 11, 2012
You don't have to be a member of the Certified Commercial Investment Member Institute, an affiliate of the National Association of Realtors, to access their publication, Investment Trends Quarterly. You could learn more about the field by reading current and back issues.
posted by Short Attention Sp at 3:11 PM on September 11, 2012
Best answer: It takes forever to get paid on a commercial real estate deal. They take a lot longer time to go through the process to get to closing. It would help you to have connections, and probably you would need experience in regular real estate. A lot depends on what it is you do NOW and how many connections you have NOW.
This is something I would not do without another stream of income. Right now especially all the realtors I know who still eat are the ones who manage rental properties on the side. My husband is out of the business totally right now, even. There are people who do very very well in commercial real estate, but a lot of times they are connected to builders, for instance. Diversification is your friend.
What is it you want out of this career? The answer to that might help you decide if you want to check this out further.
posted by St. Alia of the Bunnies at 3:29 PM on September 11, 2012
This is something I would not do without another stream of income. Right now especially all the realtors I know who still eat are the ones who manage rental properties on the side. My husband is out of the business totally right now, even. There are people who do very very well in commercial real estate, but a lot of times they are connected to builders, for instance. Diversification is your friend.
What is it you want out of this career? The answer to that might help you decide if you want to check this out further.
posted by St. Alia of the Bunnies at 3:29 PM on September 11, 2012
This thread is closed to new comments.
Can you be more specific?
Do you have a real estate salesperson or appraiser license already?
posted by FergieBelle at 11:12 AM on September 11, 2012