Joe Lopresti began working in the commercial real estate industry a little more than a decade ago. Now a vice president at the brokerage firm Jones Lang LaSalle in Melville, Lopresti got his start and worked his way up without benefit of family connections – an unusual feat in an industry dominated by regional families that have been active for multiple generations.
“It’s very rare for someone to enter the industry without connections,” said Michael Polimeni, who joined his family’s Garden City-based real estate development firm, Polimeni International, around the same time Lopresti got his start in the industry. “There are different levels of connections – not everyone is the son of the owner. It may be that they went to school with the owner’s son, or it may be a cousin of a cousin of a broker.”
But the growth of real estate programs at local colleges are opening up the industry to more newcomers every year, according to Mary Brower, an instructor in the Real Estate Institute at LIU Post in Brookville, who herself comes from a family of real estate brokers and appraisers.
“Since the colleges started offering courses, the industry has become more open to everybody,” she said. “In the 1970s and 1980s, it was more family-oriented; the coursework then was only offered through professional organizations.”
Several years ago, Hofstra University teamed up with the Long Island Real Estate Group, a philanthropic trade organization, to develop an internship program in which Hofstra students – typically undergraduate or graduate business or law students – learn about the industry by spending a day each with six companies in various real estate disciplines, ranging from brokerage and development companies to title insurance and law firms.
Typically, about 15 students go through the program at a time, said Fred Burke, executive director of the career center at the Hempstead university.
“About one or two of the 15 will have a family connection,” he said. “It’s mostly people who want to find out more about the industry. Most student’s think of real estate as selling houses; they don’t know about the various fields that commercial real estate entails and the job opportunities.”
But while the schools help usher more newcomers into the industry, it’s more difficult for young brokers to get through the early years without a little help from family or friends, Polimeni said.
Many positions pay commission only, and it takes new brokers time to build up a book of business.
“Senior brokers may throw new brokers a piece of the deal, such as showing clients a space,” Polimeni said. “But without a pre-existing relationship, it’s rare to find a broker that will take you under his wing.”
As Polimeni noted, the attrition rate in the first two to three years is high.
“A lot of brokers without ties to the industry need to get a job with a salary, which is true of any commission-driven industry,” he said. “It takes time to get a pipeline of clients rolling.”
It was a little more difficult to establish relationships without a family connection, Lopresti acknowledged.
“It’s a relationship business,” said Lopresti, whose first job was commission-only. “It’s sink or swim; if you work hard and establish strong relationships, you will do well eventually.”
He added, “If it was easy, everyone would do it.”
The commercial real estate advisory firm Newmark Grubb Knight Frank hires some associates out of college.
“New brokers have to really want it, because they won’t have to look far for reasons not to stay with it, especially with the way the market has been for the past few years,” said Daniel Gazzola, managing director for the advisory firm’s Melville office.
With the “huge turnover rate” of new associates, a company has to “be very careful about who they bring in, because they will be investing time in that person,” he said, noting his firm looks for candidates who can work with numbers and who possess sales skills and the ability to deal with rejection.
It’s easier for newcomers to break in at a brokerage firm; positions at commercial landlords and property managers are often salaried and typically go to experienced professionals, Gazzola said.
“They look to hire people who know all the players and the ins and outs of the industry,” he said. “Property managers and landlords are usually former brokers.”
Sometimes, brokers will get their start by selling residential real estate and then switch to commercial, Polimeni said.
“At small real estate offices, brokers can do both residential and commercial sales, but once you move to the upper echelons of commercial real estate, it’s a separate world,” Brower said, adding that once brokers get their foot in the door, learn the industry and make connections, they can move on to many different areas, such as working for a developer, appraiser or mortgage company.
When Polimeni hires someone, “nothing trumps having done a deal with that person,” he said. When he and Lopresti were cutting their teeth in the industry, they found themselves at the same table on several occasions. A few years ago, Polimeni appointed Lopresti the exclusive broker for one of his commercial properties.
“When you work on a deal with someone, you get a feel for the manner in which the broker conducts business,” Polimeni said, noting that he looks to hire brokers with experience representing both landlords and tenants.
“They have to understand the give and take and what’s important to the other side. Honesty is important, because it’s about building relationships for future deals.”
To help newcomers see a path to success, regional trade organizations have groups focused on helping new professionals build relationships. LIREG has its new generation group, while the Association for a Better Long Island has an associate group.
“Over the last six months or so, we have made more of an effort to engage younger professionals, and the associate group has grown to about 40 members,” said Scott Burman, principal of the Garden City development firm Engel Burman Group and chair of the associate board for ABLI.
The group meets monthly for networking events and seminars.