In value-add office investments, particularly when dealing with vacant or neglected buildings, two key components determine success: targeted investments and leasing to quality tenants. Crafting the right broker team is essential to achieving this, especially when you’re trying to shift the perception of a building that has fallen out of favor in the market.
Take my current project in Rotterdam as an example. This building had a bad reputation among local brokers because it had been neglected for years, with little to no investment from the previous owner. As a result, it had lost most of its tenants. The broker team that previously handled the building had lost confidence in its potential, given its outdated facilities and lack of funds for improvements. The building was stuck in a cycle: it attracted a certain type of tenant based on its low rental price, which made it even harder to revitalize.
Creating a Fresh Start
The moment I acquired the building, I knew the first step was to strip it down and start fresh. We began by demolishing all vacant spaces and renovating the bathroom facilities. At the same time, I made a strategic investment in a heat pump—this was during the energy crisis in May 2022, a hot topic for potential tenants. I used this investment not only to make the building more energy-efficient but also as a key selling point during our leasing campaign.
While the work was underway, I invited all the real estate brokers in the Rotterdam area to the building for a tour. Most of them were familiar with the property and had a negative view of it. During the tour, I took the time to get to know them, listened carefully to their insights, and explained my vision for the building. I walked them through the demolition process, the showroom setup, and showcased 3D renders of the final product. This approach helped to build trust and confidence, showing that we were serious about transforming the space.
Why Broker Relationships Matter
Brokers play a pivotal role in the success of a value-add investment, especially in a market where a building has a negative reputation. By fostering relationships with brokers early on, you’re not only gaining valuable market insight but also encouraging them to champion your project. In the Rotterdam project, taking the brokers through the property as it transformed helped shift their perspective. They saw firsthand the level of investment going into the building, which built trust and excitement around the opportunity to lease it to quality tenants.
I also made the strategic decision to keep the project offline during the initial phase. No advertisements, no online listings—just a quiet yet deliberate buzz within the broker community. This piqued the interest of the brokers: “What’s happening with that building?” That curiosity naturally led to more discussions, which allowed me to continuously engage with them throughout the redevelopment process.
The Power of Content and Consistency
Every step of the way, I documented the progress. Photos and videos of the demolition, rebuild, and showroom setup were posted on social media channels, not only as a marketing tool but also as proof of our commitment. This was crucial because, in the real estate world, brokers often don’t engage directly with posts or “like” content, but they do pay attention. By consistently sharing updates, I was building a narrative around the building’s transformation, which kept the brokers—and eventually potential tenants—informed and intrigued.
It’s important to remember that brokers often work in a competitive environment where they may not openly support your project at first. However, through consistent communication and evidence of progress, you gradually shift their perception. They begin to see your property as a quality investment that they can confidently show to prospective tenants. The more they see your commitment to delivering a high-quality product, the more motivated they are to help lease the building.
Crafting the Ideal Broker Team
For every value-add project, my strategy is to assemble a balanced broker team. I usually opt for a combination of a large corporate firm and a smaller boutique agency. Both bring unique strengths to the table. The larger firms have corporate tenants and access to larger spaces, while boutique agencies are often more aggressive and hungry for deals, especially when it comes to filling smaller or more niche spaces.
In my experience, the smaller agencies tend to outperform the larger firms. They are more hands-on, proactively reaching out to potential tenants and working the market diligently because they need the business to survive. On the other hand, larger corporate firms may rely on their name and reputation, often being less engaged in the day-to-day hustle of leasing.
In practice, I’ve found that boutique firms usually close about 70% of the deals, while the larger firms bring in around 30%. However, the prestige and brand of the corporate firm can lend credibility to the project, giving it more weight in the eyes of larger potential tenants. That’s why having both types of brokers on board creates a powerful leasing strategy.
Building Trust with Brokers Through Transparency
Throughout this process, one of the most important aspects is maintaining open communication with the brokers. I work closely with them, keeping them informed about every stage of the project and asking for their feedback on what tenants are looking for. When brokers feel involved and respected, they are more likely to advocate for your property to their clients.
I also take an active role in ensuring the quality of the space. Whether it’s showing brokers a fully finished, turn-key office unit or walking them through floor plans, I emphasize that we are delivering a premium product. This reassures brokers that they are bringing their clients into a high-quality environment, which in turn makes it easier for them to close deals.
R.B
“Building trust with brokers by delivering a quality, turn-key product is key to transforming perceptions and ensuring successful leasing in value-add office investments.”
A Smart Broker Strategy for Value-Add Success
In the end, creating a broker team for a value-add office building is about balance, relationships, and consistent communication. You need a mix of larger and smaller agencies to cover all your bases, but more importantly, you need to build trust with them by showing that you’re committed to delivering a quality product.
Turn-key office spaces that are ready to move into make brokers’ jobs easier and accelerate the leasing process. By taking the time to get to know the brokers, keeping them updated, and delivering on your promises, you create a win-win situation that benefits both the building’s owner and the leasing agents.
