Jugded on their results

It is hard to imagine the commercial property market without consultancies. Their names regularly feature in press statements when leasing deals or sales transactions are announced and new brands are introduced. Why is working with an agency so important for developers and investors? “For Segro, as a developer offering industrial space for lease, the most important advantage to be gained from cooperating with agencies is the possibility of reaching a broader group of potential tenants. Clients using agencies to look for warehouse or production space receive support not only in terms of choosing suitable locations and types of facility, but also when it comes to making precise and detailed specifications for the areas they would like to lease. This is an additional advantage for developers because it enables them to prepare offers tailored for a given tenant,” explains Magdalena Szulc, the director of Segro Central Europe. The pluses of leasing a facility are also crucial for other developers. “It is important that a developer’s product is marketed by the most effective agencies operating on both the global and local markets. Factors such as the client base, a professional approach to preliminary negotiations and client negotiations, as well as experience in a particular segment of the market, are also important,” adds Krzysztof Mucha, Biuro Inwestycji Kapitałowych’s leasing manager.

Ideal match
As Magdalena Szulc points out, agencies are helpful not only when it comes to leasing, but also as brokers in purchase and sale transactions. “We have also cooperated with consultancies in purchase transactions for new properties in Poland, one example of which was the acquisition of Segro Business Park Warsaw, Żerań – formerly Żerań Park II – in April 2013 and Segro Business Park Warsaw, Ożarów – formerly Ożarów Business Centre – in 2012,” explains the head of Segro. Knowledge of what consulting companies can provide, while taking into consideration the specifics of a given project, are the basic issues for an investor when it comes to choosing an agency. “Whether the cooperation with a consultancy pays off depends on the project and its attractiveness – and not only for potential tenants but also for the agency. The commercialisation of a facility requires contacts, skill and a consistent approach, which not every agent has. If you manage to agree on the mutual expectations, such cooperation can definitely benefit the developer in that it will not require employing any additional people to be responsible for the leasing process,” comments Marta Wybrańska, the senior leasing manager at Neinver Polska.

A crisis helping the agents
Contrary to the opinion that you should tighten your belt during an economic slowdown, investors are not cutting back on the companies that could help them fill up or sell their properties on attractive terms. “The benefits of long-term contracts with the renowned and financially stable partners that agencies can often introduce to clients, are often beyond worth. Limiting the costs earmarked for this purpose could result in the developer going out of business. Recovering its strength and position on the market could take a long time and cost more than would have been saved. Any drastic limitation of the costs earmarked for this purpose, particularly in difficult market conditions and in market segments where the competition is fierce, would be a mistake because this could be the only way of reaching a suitable client,” warns Krzysztof Mucha. So consultancies shouldn’t be short of work in the future. However, a growing number of people on the market are saying that the quality of such services has been declining. Some property sector players point to the sometimes poor factual preparation by agents, or their ignorance towards the expectations and requirements of clients, as well as the lack of an individual approach to specific projects. If this really is the case, then such consultancies will have to re-think and improve their activities as soon as they can. The competition is intensifying as more firms enter the scene to offer consulting services.

Agent appreciation
The strength of agencies is demonstrated by their ability to cooperate with developers and tenants and, consequently, by their contribution to the development of new projects. This is one of the reasons why the Eurobuild Awards includes three categories for consulting companies that operate in Poland: the Office Agency Team of the Year, the Retail Agency Team of the Year and the Warehouse Team Agency the Year, as well as one that recognises the best investment agency team in the CEE region. Agencies can also be entered for such categories as the Outstanding Business Award of the Year CEE and the Outstanding Non-Business Award of the Year CEE. Every year the Eurobuild Award committee chooses agency teams which, in their opinion, are the most deserving of such awards, judging them according to a variety of criteria. The competition jury, however, is mostly interested in the hard data: the number of contracts signed and the scale of the areas leased, as well as the volume of the transactions the company has acted as an agent in. Nevertheless, the experience of the jury members, who are all very familiar with the market and the quality of the services offered by consultancies, is not without importance – which is itself appreciated by the agencies themselves. “The Eurobuild Awards are very important andprestigious prizes for us, as they are recognisedand esteemed by real estate market specialists.What makes them even more significant is thefact that the winners are chosen by groups ofexperts that include developers, investors, bankers and consultants,” explains Monika Rajska-Wolińska, a managing partner of Colliers International. This consultancy was the winner ofthree categories last year: the Office Agency Team of the Year, the Retail Agency Team of the Year, and the Warehouse Agency Team of the Year. Tomasz Trzósło, the head of the Polish division of Jones Lang LaSalle, which last year was judged to have the best investment agency team in the CEE region, shares her opinion. “We appreciate the transparent structure of the voting process,” he says. Representatives of both companies admit that the competition is tough and you have to work hard in order to earn the respect of clients as well as other market players and observers. Two years ago Jones Lang LaSalle scooped up most of the prizes – and this certainly seems to have motivated the other agencies in the meantime. The jury’s decisions will be announced on December 5th at the Eurobuild Awards 2013 Gala.