The Econ 101 assumption that “consumers are rational” is total BS. Consumers are human beings, and human beings demanded that MTV produce multiple seasons of the Real World/Road Rules Challenge. Human beings allowed Adam Sandler to make movies after The Waterboy. Tell me with a straight face that consumers are rational!
How does this relate to real estate, you ask? Well, we real estate professionals know that while our clients are mostly rational, they also tend to be quite emotional. They’re two sides of the same coin. Our clients demand to see properties that won’t break the budget, yet also demand that said properties give them a certain tingly feeling on the inside.
To demonstrate my groundbreaking theory, let’s take the 1986 classic film Ferris Bueller’s Day Off. The rational and emotional side of the client is best represented by the film’s main characters, Ferris Bueller and his “BFF” Cameron. For anyone that’s seen the movie, Cameron obviously represents the rational side while Ferris is pure, unadulterated emotion. Ferris is fun! Ferris wears a vest that must’ve been cool in 1986! Ferris sings on top of a float at a weird German parade! Cameron, on the other hand, is boring. Cameron is monotone. Cameron only begrudgingly permits the crew to drive his dad’s $300,000 Ferrari without insurance. Come on, Cameron, don’t be a little bitch!
A real estate professional must balance the Ferris and Cameron in order to make their client happy. They’re peanut butter and jelly! The movie wouldn’t work without both characters; it would either be a home video of a baby-faced prick constantly the breaking the fourth wall or a documentary about a depressing high school student actually attending high school. The symbiotic relationship between emotional Ferris and rational Cameron makes the movie, just like your client’s bottom line and emotions will make the deal.
After acquiring your client— whether through cold call, blackmail, whatever— you first need to get a sense of what they’re looking for. As an office broker, I’ll ask boring questions inquiring about their ideal lease term, floorplan, and square footage. Once the boring stuff is out of the way, I go for the zinger— “how do you want your space to feel and how much are you willing to pay?”
Finding the perfect property based off economics alone is easy. You make a survey of the available options within budget and there you go. Nondescript office tower, sufficient parking, some perimeter offices, bada bing bada boom lease signed with a nice commission. But unless you’re representing Spock in leasing his new office on planet Vulcan, that’s not going to happen. People are emotional creatures, so give the people what they want!
“I just, like, would really like a pool in our next office and will pay no more than $9k a month.”
The above quote is from an actual client who (presumably) makes money. Yes, some houses in Southern California have pools, but until Olympic swimmer/real estate mogul Ryan Lochte decides to invest in some office product, your office will lack a pool. My client’s delusions aside, managing expectations is key. I truly believe that having the ability to nicely tell your client they’re a “big dumb idiot” is what separates the good brokers from the mediocre ones. We ended up leasing a creative space (i.e. exposed ceilings, concrete floors) within budget and located in a refurbished warehouse. No pool, but as far as office space goes it was sexy. As a consolation, I bought my client a goldfish and told her there was a YMCA down the street. Expectations managed! In conclusion, see Ferris Bueller’s Day Off or else none of this will have made any sense.
Tommy Adelson AKA “The Country Club Broker”
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