The Great Divide: The Market Has Moved. Have You?

The Great Divide: The Market Has Moved. Have You?

Buyers are demanding lower prices, sellers are holding on to yesterday's valuations, and brokers are caught in the middle. Here's why the current market may be one of the best opportunities of your career.

Something has changed in commercial real estate over the past 30 days.

Buyers have had enough.

After more than four years of higher borrowing costs and stubborn seller expectations, buyers are becoming increasingly adamant that property pricing needs to reflect today's capital markets.

We're hearing more stories of financing falling apart, significant price reduction demands during escrow, and transactions dying because buyers simply walk away.

Frankly, the buyers are right.

The Great Divide

I've spent three decades in commercial real estate, and one thing has remained remarkably consistent through every market cycle.

When the market is moving up, sellers adjust their expectations faster than buyers. When the market is moving down, buyers adjust faster than sellers.

Today, we're experiencing the latter.

Many sellers remain anchored to 2020 and 2021 valuations, while buyers are underwriting properties based on today's borrowing costs and required returns.

The disconnect has kept transaction volume on the sidelines, but it also presents an enormous opportunity for brokers who understand how to navigate it.

Tough Markets Create Great Brokers

I'm hearing more people talk about leaving the business because times are tough.

I think that's a mistake.

Some of the best opportunities to build a successful, lasting career come during difficult markets. These are the times when brokers develop the discipline, relationships, and expertise that will sustain them for decades.

I learned an important lesson during the Great Financial Crisis.

In 2009 and 2010, seemingly everyone was chasing bank-owned REO properties. Brokers abandoned their specialties, and investors raised enormous amounts of capital anticipating a wave of distressed property sales.

Much of that anticipated opportunity never materialized.

I called a meeting with our team and told them, "F%k what everyone says about the market. We make the market."*

We doubled down on best-in-class single-tenant retail properties, the asset class we knew better than anyone else.

The decision proved prescient. Demand increased, cap rates compressed, and values rose significantly.

The lesson?

Don't chase the crowd. Know your market, know your product, and execute better than your competition.

Why DealGround Matters More Than Ever

In difficult markets, brokers need to work smarter, prospect more consistently, and uncover opportunities their competitors are missing.

That's precisely why we built DealGround.

With powerful property research, ownership information, a massive historical library of offering memorandums, and prospecting tools, DealGround helps brokers identify opportunities, reach decision-makers, and bring more deals to the table.

And the economics are compelling.

If DealGround helps you uncover and close just one additional transaction, your return on the annual subscription could easily be 50 to 100 times your investment, or considerably more.

In a market where every deal requires more research, better data, and greater persistence, why would you willingly put yourself at a competitive disadvantage to save a few hundred dollars?

I believe DealGround should be open in the browser of every serious CRE broker, every day.

The market doesn't owe any of us a living. But it continues to offer tremendous opportunities to those willing to do the work.

The question is whether you're equipped to find them.

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Happy hunting. LFG!
The DealGround Team