The commercial real estate industry has a high attrition rate. It’s an appealing career, but not everyone is cut out to make it as a broker.
More experienced brokers generally expect that at least half of new recruits will leave within three years, while some project the new broker failure rate to be as high as 90%.
The perks of the job are part of what make it challenging: autonomy, flexibility, a commission-based salary. Some people simply lack the skills and personality necessary to succeed, but other common pitfalls can be avoided.
Here’s one of the most biggest reasons new brokers fail.
They don’t have a mentor.
Mentorship is crucial to a new broker’s success. Working with a seasoned veteran can get a young broker both new contacts and the knowledge they need to survive in the commercial real estate industry.
Most new brokers are expected to create their own leads, and they often receive little formal training on how to do this. Building a database from scratch is a daunting task, and it can take years for someone starting out to get to where they need to be to find new business consistently. When they’re brought in to help more tenured brokers, new brokers generate revenue, build their portfolio and rapport with prospective clients, and learn the subtleties of their trade. Mentors can also help mitigate missteps and provide real-world coaching to get brokers up to speed.
Junior brokers will have an easier time landing new clients if they have a portfolio of closed deals to share, and without that mentorship, it’s tough to get momentum. If they don’t have the benefit of a mentorship program at a larger firm, they may have to go out of their way to find someone to help coach them.
How to avoid this mistake
When you’re interviewing for a job, ask about mentorship opportunities and training. You might want to begin your career at a larger firm, which would have more resources to get you started and more people to help you. Many brokerages onboard new hires by pairing them with a more tenured broker.