It’s inevitable that when I work with clients new to commercial real estate, they’re confused about agents, realtors, and brokers. Most people know a residential real estate agent––there are many. Although we all take the same courses and test to get our license, things are different in commercial real estate. Let me explain and clear up the confusion.
1. Agents, realtors, and brokers are salespersons who help people buy, sell, and lease property. In common practice, if you work in residential real estate, you are known as an agent or realtor. (Technically, realtor is not a title. If someone is using REALTOR©, that means they are part of the National Association of REALTORS©, a copyrighted professional membership, or specific to commercial, MNCAR, the Minnesota Commercial Association of REALTORS®.)
2. Salespersons on the commercial side are known as brokers, as in brokering deals. If someone working at a brokerage is new or only has a sales license, they’ll be known as an associate broker or commercial real estate broker. Their license must be held by an actual licensed broker. Many commercial real estate brokers continue their training and become licensed brokers because it allows for more control. They can work for themselves and hire others to work with them, but it also adds a lot of responsibility.
3. Historically, commercial real estate brokers had a four-year college degree (although it’s not required) plus their sales license. That degree trend seems to be changing more and more.
4. Brokers and agents can do residential and commercial transactions. Today, we see residential agents doing a handful of deals in the commercial space. Most brokers don’t spend time doing residential deals. They ONLY work on commercial deals.
5. If you are thinking about getting into commercial real estate or becoming a broker, it’s best to connect with a broker who is an expert. It’s critical on the commercial side to understand both the current market and projection of years ahead. Commercial deals are usually larger, with longer terms, more costly, and often far more complicated and creative than residential deals. You want to go with someone who has the vast experience, knowledge, and skills to understand the many complexities.
Jeff Salzbrun is the owner/broker of Commercial Equities Group (CEG). As a veteran-owned real estate brokerage, CEG has been involved in thousands of sale and lease transactions, ranging from single offices to 250,000+ square foot buildings. At CEG, we get your deal done. We know space, and we know the CRE business.
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