LEADERSHIP CORNER
Good agents connect on trust level, Prudential CEO says

Interviewed by David Butts
Advertiser Staff Writer

Prudential Locations

• Title: CEO
• Company: Prudential Locations
• Age: 57
• High school: University High School
• College: University of Hawai'i
• Breakthrough job: Trading cars part-time in college

Personal profile

Q. What has the recent boom in real estate meant to sales agents' salaries?

A. We have one guy doing over a million dollars (commission in a year). The average partner here did $12.5 million in sales, which is the equivalent of maybe $200,000 plus (in commission). We have 24 partners.

Some of the partners did as much business as the typical small brokerage with eight people.

Five years ago it (one partner's annual sales) was probably closer to $7 million and a $100,000 or $125,000 (in commission) because commission rates were also different at that time.

Q. How has that much money flowing through here changed things?

A. Not a lot visually. You don't see lots of Mercedes running around. One of the reasons is they are really busy. The guy that did over a million is still driving his old van. He's working here late at night.

People that have been in the business always think they have to make their business while business is good. They are not out celebrating. They are out there working. You can walk into the office at 9 at night and you'll see sales agents moving back and forth. Six years ago, this used to be a morgue at 8:00.

Q. If interest rates go up a year from now and the stock market starts doing well, your business is going to shift. How can you prepare for that?

A. It won't shift overnight. The shift would probably take place more within the funds that have been used from the stock market moving into real estate. You'll find a shift going back there. But it doesn't change the 30-year-old from forming households. It doesn't change the baby boomer who is inheriting money from his parents and moving it into second homes.

If it were 9 percent interest rate, clearly it would slow down the market. I think anything up to 7.5 the market could sustain.

Q. It has to be a different dynamic managing a group of people where money is coming in and everything is strong to one where things are getting tighter.

A. When it gets tighter, they start listening to management. Right now, how do you talk to a guy who is having the best year of his career and say, 'You should really learn about this technology stuff.' Managers only earn their keep in bad times. In good times they are just participating in a party. I can blow up the balloons and pull out the streamers. Managers are really hired from the standpoint of dealing with things when they are not good. Good friends are made in bad times and good managers are made in bad times, not good times.

Q. Do you see a big influx of people?

A. There are a lot more people wanting to come into the business, any business that gets good. When the stock market was rolling, everybody wanted to be a stockbroker. We are running more training classes. And we are trying to get them up to speed faster.

Q. What would you say to someone who was thinking right now of becoming a real estate agent? Have they missed the boat?

A. No. I don't think so because a good real estate agent always does well. ... all the mediocre ones drop out when the market is bad.

Q. What qualities make for a good agent?

A. The first thing is they have to be able to connect with somebody on a trust level. I'm not talking about a fun, jovial guy. I'm talking about someone that people can sit down with and believe what they are saying.

Q. How are you handling the growth?

A. It is a different approach to growth this time around. I've been in the business for 35 years. We are growing in terms of the use of technology. If we went back 30 years, the growth would be 'Build another branch.' And now it is, 'How do we get it on the Net? What kind of speed can we get?' We have three people skiing now up in Whistler. They are still working because they are on the Internet. They are writing contracts off the Internet and sending them back.

Q. You have 160 agents on commission and 55 support staff on salary. How have those numbers changed with the recent real estate boom.

A: They have been relatively the same. But you have the shifting of jobs. We have more sales managers today. The face-to-face help of the agent, that's important. We have more tech people. We have less administrative-type people. People need more help to use the tools.

Q. What's the most difficult thing about managing tech people as opposed to sales people?

A. They are really two very, very different personalities, different skill sets. We have a few sales agents who speak a tech language and we have a few tech people that understand sales and they act as interpreters.

Taking on... Pleasing the clients in the information age

• The issue: How much information should agents make available to customers online?

• The solution: In May, Prudential Locations launched a Web site, BrokersMLS.com, the first in Hawai'i to include information on comparable properties recently sold.

"The process of buying today is sharing information with customers so the right decision can be made," Chee said.

"Customers want it. We give it to them. Other people who are not giving it to customers say, 'Whoa, wait a minute — this is terrible.'

"We have been doing this for years except we did it pencil and paper. They came into the office. We gave them the same information. Now we say if you are a customer, access the database, look it up. More than that, if there is a sale in your neighborhood we will send you an e-mail and tell you what it sold for.

"If you have a database like that, you would think it would be wonderful for your customer. If you don't have one, you say, 'You shouldn't do it. The other guy shouldn't do it.'

"I'm doing it 24/7 and they're not. My take on it is the customer rules the world."