The Buildout and theBrokerList teamed up for the second year in a row to complete the DNA of CRE Survey which highlights the biggest commercial real estate trends over the past year. Commercial real estate brokers from across the country were surveyed about the trends they saw during 2016, and the results were benchmarked against the previous year’s findings.
2015 showed strong retail and office space sales and leases. One of those categories continued to be strong in 2016 (spoiler alert – it wasn’t retail). Other areas stayed the same. In 2016, brokers across the U.S. still spent most of their time in the role of seller rep, and 71 percent of those surveyed again said relationships were the biggest stimulus for winning business.
Here’s our review of the good, the bad and the ugly of the 2016 DNA of CRE Survey results.
In the 2015 survey only 27 percent of brokers said they used a listing tool (Realmassive XCeligent, Loopnet, Costar, Catylist) and only 32 percent said they used LinkedIn. In 2016, both those numbers more than doubled. 72 percent of broker now say they use a listing tool, and 85 percent of those surveyed are now using LinkedIn.
In our last blog post about the DNA of CRE Survey we predicted that retail was going to be down, and we had plenty of evidence supporting that prediction. Well, we were right, retail was down year-over-year, but only by four percent. Whereas industrial property sales and leases were down 29 percent compared to 2015. We didn’t see this coming, especially since just last week Commercial Real Estate Daily wrote an article about institutions placing their bets on the industrial market. One aspect this survey didn’t take into account is the amount of the deal. Maybe an additional survey is needed to find out which property type lead to the highest transaction value.
According to the survey results, 53 percent of commercial real estate brokers are over 50 years old. For reference, the average age of retirement is 63 years old. That means the brokerage industry only has 13 years to replace over half their work force. What makes this really ugly is, only six percent of brokers were between 21-29 years old. Since the millennial generation is currently the largest age group in America, commercial real estate may want to brainstorm how to attract young brokers.
You can see the full DNA of CRE Survey Results at http://dna-of-cre.buildout.com.