Selling agents for multifamily real estate put a ton of effort into prospecting and converting new contacts into actual listings.
But that’s only half the battle…
Once a broker lands a listing, they then have to put a great effort into executing a sale.
For brokers looking to create listing presentations that stop potential buyers in their tracks, here we provide 10 in-depth tips for improving your multifamily listings.
Creating a “Sticky” Multifamily Listing Presentation
In the world of web and software analytics, two things you might hear others talking about are a webpage’s “dwell time,” and a product’s “stickiness.”
When creating a multifamily listing presentation, it’s important to keep this idea of “dwell” or “stickiness” in mind.
You should keep these two ideas in mind when creating your multifamily listing presentation, even if they’re not quite measured in the same ways.
What the heck is dwell time?
Dwell time is simply how much time a web visitor spends on a given webpage.
Typically, more time spent on a page points to the visitor mulling something over. They’re lingering. They’re considering something.
In this case, they’d be considering a multifamily property purchase.
What the heck is “stickiness”?
Similarly, the idea of a product or page being “sticky” is that when someone gets there, it’s difficult for them to leave.
Makes sense, right?
All in all, you want your listing presentations to be as “sticky” as possible for your target audience. You want them to dwell. And eventually, you want them engage.
By taking an analytical, tech-first approach, and following the 10 steps below, you can assure that your multifamily listing presentation is one that’ll stay in the minds of interested buyers.
Tip #1: Do some preliminary underwriting.
During your effort to win over this client, you may have put together what’s known as a “broker’s opinion of value,” or BOV for short.
A BOV gives the seller a broker’s honest opinion as to what he or she thinks the property could sell for on the open market.
This sets expectations, setting a baseline target for the seller, prior to even listing the property.
A BOV is just the initial step. After that, take the underwriting to the next level.
You’ll want to collect 3+ years’ of detailed financials, including a rent roll and copies of existing, in-place leases.
Having this data will help you back into a potential sales value based on the property’s income earning potential using a gross rent multiplier (GRM), which measures the property’s value relative to its rental income.
Now, you’ll want to come up with a going-in cap rate.
Both the cap rate and the GRM are important benchmarks to use when looking for comparable income properties.
If this seems like a lot of work, frankly, it’s because it is.
But any interested investor will want to see these financials, anyhow, and will appreciate the fact that you’ve put them together.
While high-level multifamily presentation books are usually made available to the masses, the detailed financials are typically reserved for those willing to sign a “CA” – which is industry lingo for confidentiality agreement.
The CA usually accompanies the multifamily investment book and financials.
Tip #2: Include market comps.
Creating a great multifamily listing book includes highlighting a few market comps, as well. It’s merely a way to build a more real-life scenario for the buyer.
You’ll want to show other properties that have recently sold, and for how much.
This will give prospective buyers a baseline as to where this particular multifamily asset sits in the holistic picture of the market.
For example, if you’re selling a 50-unit garden style apartment building, maybe you pull comps for three other Class B or Class C properties of similar scale.
You’ll show how much those sold for and then highlight the ways in which the property marketed for sale differ (maybe there are more amenities, rents are higher, or vacancy rates are lower).
Finding property intelligence has never been easier with Reonomy.
Simply search for multifamily properties in your area. Filter first for those that have sold most recently.
Then, depending on how many comps there are in your market, refine the results by looking for properties of similar size and in similar condition (which can be found by searching for properties by year built and/or year renovated).
Tip #3: Highlight hyper-local amenities and market drivers.
Why would someone want to buy this multifamily property?
- Is it located in a great, core neighborhood with strong local employers?
- Is it near major colleges and universities?
- Is it tucked just behind Main Street, where lively bars and restaurants draw people to the area?
Maybe the apartment building is located near a major highway or public transit, creating demand from commuters.
A polished multifamily listing booklet will tell the story as to why this property is such a great investment opportunity.
It will sell more than just the facts about the property – it will persuade the reader to inquire given all of the other “intangibles” about the property, such as its location, that make this such an intriguing opportunity.
Many brokers now use drone photography to show where these amenities are in relationship to the property, as shown below.
Tip #4: Summarize salient property details.
A strong multifamily listing book will include a section that summarizes key property details.
This will usually include some combination of the following: property address, formal parcel ID (which people can use to search for more information at the local assessor’s office, such as annual taxes), site size, building size, number of units, unit mix, number of parking spaces, and zoning district.
The zoning district is critically important because it indicates how the property can be utilized and/or redeveloped.
For example, a parcel located in a mixed-use commercial district may be zoned for additional height and density, which is of interest to value-add multifamily buyers who may be interested in repositioning the property and adding additional units as a way of increasing the property’s value.
Tip #5: Integrate beautiful, professional photography.
There’s nothing worse than a multifamily listing that has blurry iPhone pictures—and yet, we still see this happen!
If you’re brokering a multi-million dollar transaction, eat the cost of getting some high resolution, high-quality photos of the property.
Be sure to include interior as well as exterior photos. Professional pictures can really make an otherwise “just OK” multifamily listing really pop.
A word of caution: don’t go overboard with the photos. Use the pictures selectively.
A beautiful image should grace the cover page, and then 4-6 pictures should be used throughout the multifamily presentation book.
You should choose pictures selectively.
Tip #6: Acknowledge key market trends.
Another way to make a listing package stand out is to include a brief analysis of key market trends.
This will often include demographic data, which is critically important to multifamily apartment investors.
They want to know who’d be living in that area, the depth of the market of those who could afford rents at the price point they (the investor) need to achieve, etc.
PropertyMetrics is a great source of information for anyone looking to collect employment, population, and other economic data. This information is available for every state and MSA in the country.
There are several ways to collect this data:
Most major international brokerage companies (think: JLL, Colliers, Newmark Knight Frank, Walker & Dunlop, etc.) will have an in-house research team that puts together market prospectus indicating multifamily trends.
It is up to you, then, as the broker to compile this information in a way that makes sense to your audience.
In addition to current demographics and trends, many broker listing presentations will also include market forecasts.
Tip #7: Include your broker biography.
The multifamily presentation book that you’re about to shop around to other brokers and potential buyers is another opportunity to get your name and resume in front of some of your market’s biggest players.
You won’t want to overly tout yourself in the book. After all, the intention is to sell the property—not yourself.
But you can delicately touch upon your expertise, and at a minimum, include your name, a photo, your contact information and the same for any other brokers on your team assisting you with this transaction.
Tip #8: Add a disclaimer.
Almost all commercial real estate listing packages contain some sort of disclaimer.
This disclaimer will typically state that the property contained herein is accurate to the best of the broker’s knowledge, but it is not guaranteed. That disclaimer will usually state that buyers should do their own due diligence.
This is to protect the seller for any unintentional misstatement of facts.
For example, you say that the property is 2.8 acres in size. Two years letter, when the new owner is adding an addition to the property, they go out and get a survey. The property survey comes back and says that the lot is actually only 2.65 acres in size.
As a broker, you would not have known about this discrepancy.
You were operating off the information provided by the seller and by public records.
Assuming you have a disclosure provided with the listing materials, you’ll be covered from instances such as these.
Consider working with an attorney to ensure the disclaimer is worded appropriately.
Tip #9: Draft a template LOI for prospective buyers.
What many people don’t realize is that commercial real estate deals are generally not listed “for sale” like traditional residential properties.
Even when a commercial property, such as an apartment building, is being marketed, there is generally not a “sales price” associated with the listing.
Instead, brokers do what’s known as a “call for offers,” in which case any interested party will have until a certain date to submit a bid on the property.
And unlike residential real estate, which uses a standard offer form, commercial properties generally utilize what’s known as a “letter of intent” or “LOI.”
An LOI is essentially a buyer’s statement that they intend to offer X amount of money for Y property under Z conditions (such as financing, a property inspection, etc.).
As a broker, you’ll want to have a draft LOI that prospective buyers can use as a template if interested in purchasing the property.
This LOI template will be separate from the multifamily listing book, but will be included with the package of financials, the CA and other pertinent information provided to potential buyers.
Tip #10: Always optimize for digital distribution.
One thing many brokers often overlook is that their multifamily presentation books have not been optimized to easily transmit or be viewed electronically.
For instance, if the high-res images you include are too large of files, the PDF package that you want to circulate may be too large to deliver to someone’s inbox.
Always pay attention to digital optimization to make listing information as easy to share online (including via social media!) as possible.