Thursday, May 9, 2013
Where the Action Is
Yesterday I met with a vendor, who calls on commercial real estate companies all over Connecticut. He deals with big and small firms, and so I asked him how he thought the current state of the market was. He said that he could tell that it wasn't great, because in the very biggest offices there were no phones ringing. At the same time, however, he said that the non-national firms seemed to be outperforming the large nationals, because they are more nimble. The national firms have standard contracts that are strict and onerous. They work in big teams on countrywide accounts, that they don't control and don't negotiate with from their local office. And they are used to working on large deals. In the current market, he said, it's the 1,000 to 5,000 sf transactions that are prevailing. The national brands can't make money with multi-person teams working on a single smaller need, and they won't vary the contract that ties companies up and dictates terms. In addition, they aren't reaching out to the medium-sized companies that are growing locally. So maybe that's why Pearce Commercial had such a good year last year? We'll take it!