Commercial real estate brokerage is an industry in transformation
By : J. David Chapman/December 12, 2024
The commercial real estate (CRE) brokerage industry is undergoing significant change, driven by advancements in technology, evolving market demands and societal shifts. As the new year approaches, it’s worth considering the trends that will likely shape the future of CRE brokerage.
One prominent trend is the ongoing consolidation and collaboration within the industry. Smaller brokerage firms are increasingly merging with larger organizations to access the resources, advanced technologies and specialized expertise needed to stay competitive. Full-time analysts are becoming integral to brokerage operations, delivering client-centric solutions that integrate property technology (proptech). Tools like data analytics, virtual tours, predictive pricing models, market forecasting and AI-powered insights are revolutionizing how brokers evaluate and market properties. Firms that invest in these technologies can offer more precise, personalized client services, creating a competitive edge. However, these advanced solutions may be cost-prohibitive for smaller firms, further driving consolidation.
Another key shift is the growing demand for specialized expertise. The era of the generalist commercial broker is coming to an end, replaced by professionals who focus on niche markets such as life sciences, data centers and industrial logistics. Brokers specializing in these areas gain deep industry-specific knowledge and connections, positioning themselves as invaluable partners for clients operating in these fields. This trend poses unique challenges for smaller firms, especially in secondary markets, where access to such expertise is often limited.
At the same time, clients are seeking expanded advisory services. Rising property insurance costs, tighter lending conditions and changing economic factors are influencing transaction volumes and deal structures. Brokers are adapting by offering risk assessments, portfolio diversification strategies and alternative financing solutions to help clients navigate these challenges. Brokerages must build their capabilities in these areas to meet growing client expectations.
These shifts underscore the importance of adaptability, technological adoption and sector-focused strategies for brokers aiming to thrive in the evolving landscape. For commercial brokerages in secondary markets like Oklahoma City and Tulsa, these dynamics may drive increased collaboration—or even consolidation—with larger firms in major hubs such as Dallas, Chicago and Los Angeles. While I continue to believe the traditional brokerage services are vitally important in the commercial real estate sector, we will continue to see the Broker’s role evolve as their customers’ needs change.
David Chapman, Ph.D., is professor of finance & real estate at the University of Central Oklahoma (jchapman7@uco.edu).