Philly Market Leaders On How The Role Of Broker Is Changing

Cautious capital markets are keeping CRE transactions in greater Philadelphia from moving at the speed some players would like, but brokerage firms are still finding ways to stay relevant.

Providing strong advice and connecting clients to the right vendors are becoming increasingly important ways for brokers to create value for clients, brokerage leaders said during Bisnow’s Philadelphia State of the Market event last month. They also discussed training the next generation of brokers and ways to use artificial intelligence.

“The way in which a lot of us are seeing the role evolve is as advisers,” Newmark Philadelphia Market Leader Lauren Gilchrist said. 

“Broker has certain connotations to certain types of clients, and I don't think we ultimately want to be in the business of brokering people. I think we want to be in the business of dispensing really, really good information and advice.”

She said it is important to add value for clients even when they aren’t buying, selling or relocating.

Owners may not be looking to put their property on the market, but Gilchrist said her team can still provide advice on topics like replanting. An office tenant might be planning to stay put, but real estate firms like Newmark can help them optimize their existing space.

Connecting clients with the right vendors is a big part of that, said Ken Wellar, founding partner of multifamily investment sales brokerage GREA.

“It's about knowing not only your team but also the vendors outside in the market who could actually deliver the best product,” he said.

“Who should I talk to about a tax appeal? Who should I go to as an architect? Who should I talk to about getting calls on this new construction deal?”

As brokerage leaders look to hire and train talent, the shifting dynamics of CRE sectors have led to imbalances between which sectors young brokerage professionals pursue.  

“Everybody is either going into multifamily or industrial,” Colliers Executive Managing Director Brian Hilger said. “Finding an office broker in their 20s right now is almost impossible.”

But Hilger encouraged up-and-comers in the field to consider office and retail, sectors he predicted are due for a comeback.

Providing young brokers with proper training is another challenge, as their midlevel superiors spend less time in the office postpandemic and aren’t eager to take on the task.

“I won't mention anybody in this room, but they don't want to take on new people,” Hilger said.

AI is also making waves in the brokerage world, but leaders had varied opinions on the technology. Hilger said he doesn’t use it, but many of his reports do.

“Where I think it’s a little dangerous is the younger people who understand it a little more might depend on it a little more,” he said.

Cresa Northeast Managing Principal Tony Juliano said he is “terrified” of the technology but has found it is useful from a productivity standpoint.

The brokerage won a 50K SF deal after one of his workers used AI to quickly analyze the request for proposal documents and turn around a bid before the competition.

“I just hope it doesn’t make us dumb,” Juliano said.