There’s a not-so-secret sauce to success, and it’s straightforward: It all starts with the people. If you have the right people working for you, good things happen for the clients you work for. NAI Elliott and our brokerage clients have experienced the benefits of that truth, particularly in 2021.
NAI Elliott experienced unprecedented growth in our brokerage business in 2021. That’s more than a little counter-intuitive, given some of the pandemic’s perceived effects on commercial real estate. But the addition of the right people to our brokerage team—along with a resolute focus on relationships over transactions, and a willingness to balance focus with responsiveness—formed a foundation for this success.
An evolution into brokerage
As background, NAI Elliott started as a property management company in the retail sector in the early 1980s. As clients came to rely on us for their property management needs, the conversation naturally evolved to assisting with leasing. More specifically, the “big” firms in town would sour on projects when they dwindled to a vacancy here or a 1,500-square-foot space there. Seeing an opportunity, the NAI Elliott founders allocated a team member to focus exclusively on leasing—and thus our brokerage department was born.
Brokerage hits an inflection point
That brokerage business experienced a transformational moment in January 2021 when George Macoubray and Nick Stanton, two top area brokers we had collaborated with for decades, joined us as a “partner team,” focused on retail leasing. It was a coup to bring in a team that has such sustained success in the market, a tremendous client list and existing relationships with our company that run deep.
What happened next was key. Being well-known standouts within the industry, the new team’s arrival generated a lot of attention in the market, from brokers and prospective clients alike. The result was twofold. First, additional brokers joined our firm; we’ve doubled our team size. And second, our incumbent brokers saw their business grow as clients recognized how we had strengthened our expertise and capabilities. It was classic synergy: These two factors combined to produce explosive growth.
And as we continue to grow the brokerage, our focus will remain on enhancing relationships with our clients and the entire brokerage community, as well as having incoming and incumbent brokers collaborating across brokerage disciplines.
The most important takeaway? Our commitment to integrity, relationships and collaboration has brought the right people to NAI Elliott, reinforcing what has made the company and our clients successful for 40 years.
Putting numbers on the changes
Those baseline values may be intangible, but the resulting success is easily measured. Our brokerage experienced an extraordinary 229% increase in total transaction value from 2020 to 2021. We eclipsed $250 million across leasing, sales and consulting.
A sampling of changes to our transaction profile:
• The number of lease transactions more than doubled, increasing 110%
• Investment sales transaction value more than tripled, increasing 368%
• Business sourced from existing clients increased from 28% of company revenue to 56%
• Landlord representation decreased from 49% of company revenue to 36%
While we’ve never been focused on investment sales (although we’re absolutely capable), we were an active participant in the well-publicized trend of investors placing vast amounts of on-hand equity. We completed more than $140 million in sales transactions—approximately 60% of that representing buyers, on transactions from Alaska to Washington, from retail to office.
Looking behind the numbers
A look behind all these numbers reveals some notable conclusions. For one, the combination of new arrivals, paired with stellar years by several of our longtime leasing agents, drove a huge increase in transaction volume: We averaged 1.2 completed transactions every business day of the year.
It’s also a reminder that relationships are key to our business, and the huge increase in volume from existing clients reflects the degree of trust they have that we can work together to fulfill their needs, bolstered by the early indications of a post-pandemic surge in transactions.
And finally: Based on our property management roots, landlord representation has always been a natural foundation of our brokerage business. But the increase in tenant and buyer representation reflects our deliberate effort to balance our brokerage focus with the tenant-friendly environment we’re in post-pandemic.
What’s still the same
While change that leads to success is wonderful, it doesn’t mean we’ve radically altered our business, people, market reach or client base. Many elements of our brokerage work remain constant. For example, revenue generated by retail properties changed less than 2% year over year, and revenue by sub-market did not vary by more than 2% across the entire Portland/Vancouver MSA. And we maintained balance in our market diversity; beyond retail, the remaining half of our work is evenly distributed across other property types, including industrial, office, medical and multifamily.
The even distribution of our work across the sub-markets of the larger Portland metropolitan area reflects our desire to remain generalists in appropriate areas of our company, not becoming too focused on a particular market and remaining ready to assist clients anywhere in the region.
It’s the people
Let me reiterate: If you have the right people, good things happen. As our brokerage department doubled in size, choosing the right people was how we enhanced our breadth and depth of experience and expertise, while reinforcing our core approach to doing business. That has resulted in an even greater capability to meet client needs and achieve success, through and after a turbulent time.