When I first got into C.R.E., we were told to pick an asset class and focus strictly on that asset class. Typically, most companies frown upon it, and many forbid agents to conduct business outside of their chosen asset class. Understanding other markets was a lot harder back then because we did not have the tools that we currently have at our fingertips. When we chose an asset class, we cold called all the owners and tenants or walked/canvassed the communities we wanted to work in and build our business. With today’s technology, we can get access to owner/tenant information at the click of a button from our office (I do recommend you still cold call and walk the communities you want to work in) as well as most currently available properties and save hours of time. Even more importantly, analytics of the market and asset types are readily available, allowing you to understand multiple markets much more easily.

With this evolution in our business, agents can adapt their business and now proficiently take on more than one asset class, which opens the door for us to diversify. There are many benefits to diversification, not least of which is reducing risk to the agent’s business during an economic downturn or, in some cases, when the market has been so robust. The ability to reduce risk in our business, as in any business, is key to our long-term success. If you are working in one asset class and that class gets saturated by development, or is impacted by either outside debt or equity availability, or even unforeseen new government regulations, you can see a large impact on your income. I recently spoke to a C.R.E. agent in Manhattan, NY who is focused solely on multifamily. The city recently placed a new rent control measure that severely impacted the value of the properties and therefore her clients as well. Due to this, her deal flow has become almost non-existent, and now she is scrambling to find another way to generate income. Another example is an agent I once knew who focused on the Beverly Hills Triangle office market, and the market got down to a 2% vacancy rate. He was so specialized that a strong leasing market almost put him out of business.

The bottom line is that the market is dynamic and always changing, so you need to be prepared to adjust with the market. If you are with a company that requires you to focus on one asset class in a specific area, you might want to consider starting a new company that will give you the freedom to create a viable long-term plan. Likewise, if you specialize in any type of investment sale, you should learn how to do an office or retail lease as well.

If you think about it, there are few businesses that have not had to diversify in one way or another, so don’t allow a company to limit your future potential income. You got into this business because you are an entrepreneur that wants to create a lucrative business, so find the right opportunity that allows you to spread your wings and create the life you desire.