In the dynamic world of commercial real estate, businesses often find they need diverse perspectives and counsel to help them navigate their strategies. And commercial mortgage brokers are uniquely positioned to provide perspective and counsel. Whether working directly with landlords or tenants, brokers can offer advice on ways to maximize the use of space and help clients achieve their business objectives.
The advisory role that mortgage brokers can play includes acting as a sounding board, listening to a client’s concerns and offering critical advice. Being close to their clients will help brokers facilitate successful deals while also developing long-lasting business relationships.
This role is particularly important to clients who are undergoing major changes. One aspect of the mortgage broker advisory role is help with change management. When done well, the added value that change management brings can help to close deals faster while building a deeper, more diverse referral network.
Change management is the art and science of leading an organization through substantial transformation. It is a structural process for planning and implementing new ways of operating within an organization. It requires boldness in the face of inevitable resistance as well as clear, measurable goals that are rooted in articulate and thoughtful answers to one question: Why change?
Embracing change
When the question of change doesn’t have a good answer for the people whom change affects, the subsequent lack of buy-in inevitably leads to failure. To avoid such problems, change management strategies must address several key aspects.
First, it is important to define the driving purpose so that everyone can understand why a company is making a change. Address the human side of change, which takes into account the impact on employees. And acknowledge that change cannot happen with a snap of the fingers or a hope that everything will be OK. Next, work through the change process by engaging everyone involved in the change. Allow voices to be heard and concerns to be addressed. Encourage continuing participation in the process by facilitating the journey and keeping people from resorting to old habits.
A mortgage broker’s role in change management starts by helping a client solve a space issue, which can solve a business issue. It’s about taking them from a statement such as “my lease is running out and I need new space” to helping them define their space requirements. They should be making smart business decisions via solutions that are aligned with the direction their business is going.
For example, when tenants say they need more space, a mortgage broker thinking about change management will start by asking about what they’re looking to get out of the space. This immediately transforms the conversation from a transaction to a strategic collaboration. Change management helps to clarify the client’s needs and the impact these needs will have on their business and their employees.
Companies that specialize in commercial real estate change management are regularly tapped to collaborate with mortgage brokers and help clients navigate this change curve. Increasingly, these specialists find that mortgage brokers who embrace change management strategies have faster closing rates.
Brokers should think beyond the footprint of a property to its impact on the business. This creates opportunities to deliver smarter real estate solutions, which in turn will lead to successful transactions, happier clients and lasting business relationships.
Time is money
It may feel like more time is needed at the beginning of the process to consider these factors. But that isn’t the case. When done well, adding a change management perspective to the real estate transaction process helps to close deals more efficiently.
Several years ago, for example, an international security company needed help to select new offices at 200 locations across the U.S. This had to be done in less than six months. They contacted a project management consulting company that specialized in change management.
The security company wanted to look at virtually every property on the market. But the consulting firm helped to define what the space needs were and how to target the client’s approach by narrowing down the search. The consultant succeeded in doing this by using an essential change management checklist, composed of a series of questions that included the following:
- Do the locations meet the requirements of the company?
- Is there enough parking to meet needs?
- Are the locations accessible to all employees and clients?
- Should they be located near public transportation options?
- Is the site compliant with the standards of the Americans with Disabilities Act?
- Are there any special needs or requests for the facility?
The answers to these and other questions allowed the firm and their mortgage broker to explore potential real estate options with precision and purpose in relation to physical parameters, such as access for emergency vehicles and proximity to customers. The sites were also weighed with other incentives, such as financial or tax benefits of certain municipal zones.
Creating buy-in
Once the consultants narrowed down the options, they worked with the client and their program management team to get employee input so that everyone in the security company felt heard. This approach narrowed down the search to a manageable level while helping the client communicate the reason for change to its employees.
Management’s explanation went beyond “our lease is up” to showing the benefits that change would have upon the employees. As a result, buy-in was easier to obtain, impact to productivity was minimized, and the move was more seamless and less stressful.
Instead of wasting everyone’s time looking at countless properties that met some arbitrary square-footage requirement, the consultant was able to present a handful of exacting possibilities that led to a faster close and a happier client. Furthermore, the lasting impression of the entire experience led the client to remember the benefits of working with a mortgage broker who took into consideration the full impact of the company’s move. At the end of the process, not only did the transaction itself close more quickly, but after the deal was completed, the client regularly referred other prospects to the broker.
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Change doesn’t happen to an organization; it happens within an organization. Truly meaningful change needs to be spurred by a deep understanding of the problems that the change intends to fix, the opportunities the change intends to create and what success after the change will look like.
The COVID-19 pandemic resulted in tremendous change that the business world and commercial real estate stakeholders are experiencing to this day. Too many businesses have yet to acknowledge the level of change their employees have experienced and that they are essentially trying to fit square pegs into round holes. They are attempting to put today’s people, priorities and business realities into an office space that was designed for a different time.
A common example of this is the current discussion around hybrid work, a flexible model that supports a blend of in-office, remote and on-the-go working environments. But companies often make the mistake of thinking that the concept of hybrid work means the same thing for everyone when it may not.
Instead, companies need to use change management to help address this new reality. They should develop solutions for the contemporary demands of flexible working conditions. Mortgage brokers are on the front lines of helping businesses navigate this ever-changing world. When they bring a strategic change management perspective to the negotiating table, everybody wins. ●
