By year’s end, some of commercial real estate’s freshest young brokers will give up on the somnolent field and start searching for a new line of work, according to the industry’s older hands.
“This is a cliché, but this is the time when the men are separated from the boys,” said Cory Zelnik, of Zelnik and Company.
It’s apparently an apt cliché: “This market, I hate to say it, separates the men from the boys, the strong from the weak,” said Faith Hope Consolo, chairwoman of the retail leasing and sales division at Prudential Douglas Elliman. The “boys” in this case are the newcomers. The poor unfortunates without fat wallets, fat rolodexes or, for that matter, fat bottoms big enough to weather the economic downturn that’s flushing so much work from the commercial brokerage business.
The brokers, all commission-based, won’t get axed in the traditional sense. Rather, they will ax themselves, committing a sort of collective professional suicide.
“People won’t make deals, so they’ll quit,” said Eric Michael Anton, executive managing director at Eastern Consolidated. “If you don’t make deals after six to 12 months, it’s hard to keep going.”
Particularly when older brokers are less willing to help. In boom times, senior brokers are more willing to play benevolent despot and share business with junior colleagues. In slumps, they get stingier. And, believe it or not, the backstabbing profession gets—egad!—even backstabbier.
“You have retail brokers trying to do office, office brokers trying to do retail, instead of remaining specialized,” Ms. Consolo said. “It gets messy,” she said, using what is likely a euphemism.
There are other, less scary-sounding repercussions. CB Richard Ellis is forcing its brokers to pay for part of their FedEx and messenger services. And word has it that some real estate law firms won’t be hosting quite such lavish parties this holiday season.
Industries that service the office market are also beginning to suffer.
Laurence Jones, of Laurence Jones Architects, does a lot of office interior work, but counts himself lucky because he’s diversified into schools and residential. He has an inkling that other firms haven’t shared his foresight. Indeed, Mr. Jones was startled by the level of interest he got in a recent job opening at his firm.
“More senior people are looking for jobs,” he said of the architecture industry. “The asking salary ranges have definitely dropped. People who were asking $125,000 a year might be asking for under a hundred now. We can get better people than we thought we could get.”
Mr. Zelnik, for one, is hoping to take advantage of a similar phenomenon.
“I hope to benefit,” he said. “If I can find some quality brokers that are getting squeezed out of their organizations, we have some business that we can help them along with. I’d love to fill some voids.”