While there is still a sense among established commercial real estate brokers and investors that this industry will always be the same, the new guard is here and the industry is changing whether we are ready for it or not. Many millennials are now advancing beyond the threshold of their mid twenties with a number already in their thirties, established in their careers and looking for ways to invest their capital. However, as a generation that came of age under the greatest financial crisis since the Great Depression, millennials are a generation that refuses to do things the way former generations choose to. No matter whether you see the change as bad or you can spot the benefits of a changing industry, there is no doubt that millennial influence is seeping into all aspects of commercial real estate. The forward thinking firms will ride the wave and take advantage of the new investors while those that can’t adjust will be left to the declining surf as the wave passes. At LCI Realty, we pride ourselves on recognizing emerging trends while finding a way to bridge the gap for investors still adjusting to change. Here are some of the ways in which millennial influence has already changed the commercial real estate industry.
Losing Out On Phone Calls
Phone calls, no matter how much some people like them, are becoming a thing of the past. That’s not to say that people don’t want to communicate with their voices, but the hard and fast model of collecting phone numbers and making cold calls is no longer part of the geography of concerns. Millennial agents, brokers and consumers recognize that it’s easier to answer simple questions and queries through text rather than over a drawn out phone call. Dispensing with pleasantries is one of the foremost indicators of millennial influence on the industry. However, before you get out your pitchforks, millennial brokers and agents are advocating being rude. They understand that their consumers see the time used for a quick phone call that could fit in a text as an encroachment on their busy schedule. For the new generation of investors, it’s all about efficiency.
Consumer Facing Research
With the importance of Google reviews and Yelp, more millennials are used to seeking information about a product, service or even agent from their peers over trusting the word of an industry professional. In that regard, as millennial influence becomes more prominent, understand that they expect the access to professional information to closer resemble consumer facing research. Things that might traditionally be contained beyond a wall that’s breached only with a professional relationship are now expected to be transparent and those that are not transparent will not earn the trust of the new generation of investors.
A Virtual Tour
This is probably one of the most obviously positive changes for investors and a millennial influence that much of the industry has not adjusted to. Those that recognize the cost savings are ecstatic, but those that recognize this threatens to change the jobs of commercial agents don’t like the implications. However, you just can’t argue with the fact that even the most amateur photographer can make a virtual tour that can turn a cold lead into a warm lead without ever paying someone to go and show the property.
Face to Face…Online
Face to face interaction is always going to be important in the commercial real estate industry, but how that interaction takes place is changing. Millennials are more likely to look for reviews and representation long before you ever get a chance to shake their hand. 8 out of 10 millennials will not even buy anything without first reading a review. The era of open houses and networking events is coming to a close. You have to make sure you stack up to millennial influence by making sure your online “face” is as cultivated as you want it to be to start closing the deal.
Trust is a huge matter for millennials. Despite conjecture about avocado toast and laziness keeping millennials from the housing market, studies are now finding that it has been a lack of trust keeping the generation from buying. After the housing market bubble and crash, how can anyone blame them? Studies show that only 19% of millennials trust other people and that spells trouble for the commercial real estate industry because deals are often built on a degree of trust. As with your outside representation, one of the most optimal things you can do as a broker to assuage the doubts of millennial influence is to make sure that your online representations indicate that you can be trusted.
On that note, LCI Realty is proud to say that we are a resource that can be trusted, no matter what your interests in commercial real estate are. We provide property management, tenant representation and brokerage services throughout the Valley. Want to chat about what we can do for you? Find us on Twitter with @LCIRealty.