Friday, 4/16/10 By Eric Snyder
Nashville Business Journal
Rocky 2009 Rattles 'Heavy Hitters' Roster of Top Brokers
Veterans offer up advice for weathering tough market: Stay focused, be persistent, look long term, seek partners.

Many of this year's Heavy Hitters nominees, based on commercial real estate sales and leases in 2009, aren't exactly beaming about the year that was.

"2009 was a very tough year. It was a very difficult year," said John Keller, a senior vice president for office services with ProVenture Commercial Real Estate. Keller represented landlords in 67 lease deals, more than any other landlord representative in 2009. He shrugs that off, however. "It's nothing special. It's the nature of the product I represent," he said, referring in particular to Synergy Business Park, which houses more than 150 tenants, some with footprints as small as 325 square feet. Keller also represents large clients as well, however, including Renal Advantage Inc.'s lease for 54,000 square feet in Cool Spring's McEwen Building, one of the biggest lease deals signed for 2010.

The Nashville Business Journal's annual Heavy Hitters list recognizes brokers for their leasing and sales activity the year prior, ranked by total square-footage impacted, in several categories. The industrial list remained the most stable, with six of the top 10 industrial brokers making a repeat appearance from last year's top 10. There were more new faces in the other categories, however.

Of the top 10 office landlord/owner brokers, three appeared in the same range last year; two of the top seven retail brokers are returning from last year, and one of the top six office tenant brokers returns from last year.

Billy Lyell, a principal with Nashville Commercial Real Estate Services/Cushman & Wakefield, finished the year as a top-seven broker in three different categories: tenant representation deals, landlord representation deals and retail deals. Not a bad year, right?

"I'd say it was a very average year," he said. "Average to below-average. I worked harder last year than I probably ever worked in commercial real estate."

Heavy Hitter-nominee Jody Elder, an affiliate broker at Nashville Commercial, said in an e-mail that he had to learn to work more efficiently in 2009 "because deals are on average smaller and take twice as long to get to the finish line. Both parties in a transaction are tending to negotiate longer in (an) effort to squeeze every bit of potential value out of it."

Elder, and many other brokers, said one way to work more efficiently was to partner with other brokers.

"As the Bible says, two are better than one," Elder said.

David McRae, a principal with Newmark Knight Frank, said 2009 wasn't a bad year for tenant representation, which is all the firm does. Including McRae, three Newmark Knight Frank brokers finished 2009 among the top five Heavy Hitters on the list of tenant reps for office space.

With the real estate market heavily favoring tenants - rents have dropped as vacancies increased - McRae's clients were not without "ample opportunities."

Asked if 2009 was a good year, a relatively good year or none of the above, Cassidy Turley principal Dave McGahren admittedly waxed philosophical, saying that depended on how you defined "good."

"Commission wise, it was not up to standard at all," said McGahren, who partnered with fellow Cassidy Turley brokers Doug Howard and John Ward to complete 41 industrial lease deals in 2009. But, he said, the pay off will come down the road.

"This is a chance to shine," McGahren said, referring to the downturn in the real estate market.

While deals may be fewer and the commissions smaller, it provides a prime opportunity for brokers to give their clients value by helping them find that prime sublease space or realize substantial savings in rent - value the clients will remember for years to come.

"You'll benefit from that in the long run," McGahren said. "It's a long-term business."

Keller agree, saying 2009 was a year that required brokers, particularly those representing landlords, to recalibrate their expectations of tenants.

"You might have to be willing to work with them in the hard times with the hope that they're going to remember that when times get good," he said.

For Elder, 2009 was proof of previous relationships paying off - as he said most of his deals were relationship-based, referrals or repeat clients.

Several of the Heavy Hitters offered their advice for the industry's newer brokers. A common suggestion: Stay focused.

Though it can also happen to veteran brokers, Lyell said new brokers are particularly prone to "chase any kind of deal that they catch wind of." Though it might be alluring in a slow market for a retail broker to chase an industrial deal, doing so will likely distract that broker from what should be his or her expertise.

In a similar vein, McRae said young brokers "have a propensity to chase deals that may be out of their league."

"You really need to find your niche in the market," he said. That may not be industry specific, a la health care, but a part of town, or clients within a certain square-footage range.

McGahren offered simple, but prudent, advice.

"Don't give up. Figure out ways to be a resource for your client," he said.

While he and other brokers mentioned the need to get in front of clients and not just cold-call on the phone, McGahren said brokers should have a reason to do so when they reach out to potential clients, and not just offer a generic solicitation.

"You have to have something that they want from you," he said. "Know something about them. Know something about their business. Have a reason to call them."

After all, he said, the nature of being a commercial real estate broker is evolving so that it's more than helping clients through a transaction, but also about partnering with them as consultants.

"There's a lot more thought, a lot more strategy that goes into how we approach each of the deals," McGahren said.