Today’s CRE Market: An Insider’s POV

To get the inside scoop on today’s commercial real estate (CRE) market, we sat down with Brad Kuskin, Managing Agent of Keller Williams Commercial Real Estate. In this Workplace Unplugged interview, Brad discusses how the CRE industry has changed over the past 15 years and shares key insights about buying and leasing real estate today.

Brad has been a licensed real estate broker since 2001 and has participated in over 300 acquisitions, mergers, and lease executions. With advanced degrees in Real Estate, Finance, and Computer Sciences, Brad began his career on Wall Street before moving into commercial real estate in 2004, drawn by the influx of capital into investment real estate markets. He found that commercial property markets allowed him to combine his expertise in finance and real estate, leading to success in a rapidly growing segment of the capital markets.

KW CRECO and Keller Williams’ Unique Position

KW CRECO is Keller Williams’ commercial arm in South Florida. Brad highlights the synergy between the residential and commercial sides of the Keller Williams network. As the largest real estate franchise in the nation, Keller Williams offers clients comprehensive real estate services that span both residential and commercial needs. This integrated approach allows clients to stay within the Keller Williams network for various property types, positioning the company as a premier agency in the sector.

Changes in the CRE Industry Over the Past Decade

Brad notes significant changes in the industry, particularly the increased reliance on technology. In the early 2000s, the market depended more on personal networks. As more people entered the commercial real estate markets, especially residential brokers, there was a tendency to treat commercial deals like residential ones. However, after the 2008/2009 crash, the industry returned to fundamentals, with a focus on diligent underwriting and financials. The market now favors accredited investors and experienced brokers who specialize in commercial real estate.

Technology has transformed the process of locating properties. While anyone can now search for properties online, experienced brokers add value by guiding complex transactions to completion. Commercial real estate involves numerous variables and is more complex than residential transactions, requiring professional expertise to navigate successfully.

The "Happiness Coefficient" and Intangible Value

Brad discusses the importance of intangible qualities—what he calls the "happiness coefficient"—in today’s market. Younger buyers and investors are increasingly valuing factors like sustainability, design, societal impact, walkability, and a sense of community. These variables are difficult to quantify but can command a premium in the market. Developers and investors are challenged to account for these intangibles, as people may be willing to pay more for properties that offer these "feel good" factors.

In office buildings, these happiness indicators are also relevant. There is a shift away from large open cubicle spaces toward environments with natural lighting, fresh air, outdoor break rooms, and other features that enhance well-being and productivity. The office environment now plays a significant role in business outcomes.

Flexible Working and Its Impact on Real Estate

Flexible working arrangements, such as hot desking, hoteling, and remote work, have changed how companies approach real estate. The location premium is not as significant as it once was. Companies are seeking more sustainable and affordable locations, often in suburban areas, rather than paying high rents for downtown offices. This trend has contributed to suburban sprawl in many metropolitan areas, including Southern Florida.

The Future of CRE: Technology and Market Transparency

Technology continues to reshape the CRE landscape, making market information more transparent and accessible. High-definition financial analysis and demographic studies are now readily available, leveling the playing field for investors. The market has become more like a commodity trading arena, with properties trading similarly across regions based on standardized metrics. The days of "pocket listings" and above-market returns for a select few are largely over, as listings now reach a global audience.

Advice for Newcomers to the Industry

Brad offers advice to those starting out in commercial real estate:

• ​Don’t underestimate others’ willingness to seek better deals or higher profits.
• ​Don’t count on a deal until it is closed; focus on client success rather than commissions.
• ​Building a reputation through referrals, word of mouth, and positive client reviews is the best marketing strategy.

For more industry insights, Brad’s featured posts can be found on KW CRECO, or he can be reached directly via email.