COMMERCIAL INVESTMENT SALES AND MARKETING
Specializing in Commercial Properties, Residential Investment Properties, and Business Opportunities
Choose a REALTOR®
At Ileri Commercial of Nitro Realty, we welcome the opportunity to meet with potential clients virtually, telephonically, or in-person (according to federal, state, local, and CDC COVID-19 guidelines) to discuss their commercial investment real estate and small business opportunity needs and wants.
We are licensed real estate and business opportunity brokerage professionals, REALTOR® practitioners, and fiduciary sales representatives during the brokerage transaction and protect the interests of our clients while treating all parties to the transaction fairly.*
On brokerage assignments, we personally coordinate and manage the entire real estate or business opportunity transaction process from initial start-up to assignment completion. We also focus our sales efforts on "performance and results" in order to obtain the best price and terms, in the shortest time possible, with the least amount of inconvenience to our clients.
As private business consultants, we also provide clients and customers with objective business information and market intelligence to support their strategic decision making process. We work with private individuals, small businesses, and various organizations. Ileri Commercial is a diversity-friendly enterprise serving the U.S. and international marketplace.
As a REALTOR® commercial practitioner and member of the National Association of REALTORS®, we have pledged to provide equal professional services to and not discriminate against any person or persons on the basis of race, color, religion, sex, handicap, familial status, national origin, sexual orientation, gender identity, socioeconomic status, or political affiliation. Nor do we use harassing speech, hate speech, epithets, or slurs based on race, color, religion, sex, handicap, familial status, national origin, sexual orientation, or gender identity. www.nar.realtor
*Brokerage and fiduciary client representation services are offered in affiliation with our sponsoring broker partner, Nitro Realty. Contact us or learn more about our client assessment.
Welcome to Ileri Commercial at Nitro Realty. Ileri Commercial is a locally based, globally connected "Main Street" private practice specializing in the sales, marketing, leasing, and acquisition of commercial income properties, residential income properties, and small business opportunities in the urban core/central city market. Our mission is to help our business clients and customers (private investors, stakeholders, small business owners, families, and entrepreneurs) achieve their personal and financial objectives.
We are business-oriented, nontraditional commercial-investment practitioner members of the National Association of REALTORS® (NAR), sales professional members of the National Association of Sales Professionals (NASP), and other trade associations. Our industry memberships demonstrate our commitment to industry best practice standards. We collaborate ethically and professionally with clients, customers, and all professionals involved in the brokerage transaction or consulting engagement.
Ileri Commercial is an independent sales organization (ISO) owned and operated by Ileri Ogunfiditimi. Our business opportunities and commercial-investment sales and marketing practice is sponsored by and affiliated with the Nitro Realty brokerage firm. Our sponsorship and business alliance with the Nitro Realty network provides us with the entrepreneurial freedom, comprehensive support, and management resources needed to help clients and customers achieve results.
Our professional sales practice is associated with Ileri Consulting™, an independent business consulting organization also owned and operated by Ileri Ogunfiditimi.
We focus on performance and results.™
ILERI OGUNFIDITIMI, REALTOR®, LREA, BC
Tel: +1-888-444-9964, Ext. 123
Ileri Ogunfiditimi¹ is a self-employed professional salesperson, business opportunities broker, commercial-investment broker, business appraiser, business consultant (BC), marketer, business developer, and lifestyle entrepreneur. He is Principal of Ileri Commercial at Nitro Realty and Ileri Consulting.
Ileri Commercial is an independent contracting multijurisdictional commercial-investment sales practice specializing in the sales and marketing of private residential investment properties, commercial investment properties, and business investment opportunities. Ileri Consulting is an independent contracting specialty consulting practice which provides business, financial, and market intelligence to domestic and international private investors, business executives, and owners of privately-held income-producing real estate and small businesses.
Ileri is a down-to-earth, unconventional individual practitioner with an opportunistic spirit and enterprising mindset. He is an independent thinker, passionate businessperson, ardent believer in and supporter of commerce, investing, wealth-building, and entrepreneurism.
Ileri offers Outsourced Sales Services (sales planning and development, personal selling, market penetration strategy, customer service support, cost containment, transaction management, risk management, sales representation, prospecting, asset disposition and acquisition, and many other sales functions) as an affiliated independent sales associate (ISA) at the Nitro Realty brokerage firm.
His private sales practice specializes in commercial and investment real estate brokerage, and business opportunities brokerage. Ileri has more than 18 years' of industry and small business experience.
Ileri is a REALTOR® and licensed real estate agent (LREA). He provides fiduciary client representation services under the U.S. legal fiduciary standard. His commercial-investment sales practice complies with the Maryland and District of Columbia Legal Code of Ethics, National Association of Sales Professionals' (NASP) Code of Ethics, and subscribes to the strict Code of Ethics and Standards of Professional Practice promulgated by the National Association of REALTORS® (NAR).
As a private BC and investment analyst, Ileri also complies with the Business Valuation Standards (BVS) of the Appraisal Foundation's Uniform Standards of Professional Appraisal Practice (USPAP), the BVS and Code of Ethical Principles of the International Valuation Standards Council (IVSC), the definitive appraisal guidelines of IRS Revenue Ruling 59-60, NAR Code of Ethics, the best practices of the Independent Consulting Industry, and definition of real estate counseling services developed by The Counselors of Real Estate (CRE) (formerly known as The American Society of Real Estate Counselors [ASREC]) of the National Association of REALTORS® (NAR).
His varied work experience includes commercial real estate ownership and property management, office and retail leasing, luxury residential apartment leasing, property sales and purchasing activities, loan origination and mortgage banking, Class A office development, general construction and building maintenance, carpentry, handyperson services, private security, transportation and delivery services, customer service, office administration, private consulting, entertainment journalism, artist and repertoire (A&R) music representation, and urban music promotion.
His past business management experience includes the ownership of an independent record label, music promotions company, investment property management firm, and an inventory liquidation business. Ileri is a self-directed, lifelong learner and has continued his educational pursuits.
He has earned several professional certifications; completed thousands of hours in adult and advanced continuing education; completed real estate studies at a career college; and studied at three accredited universities (including two HBCUs) earning 150 cumulative Semester Credit Hours (SCH) by successfully completing 50 college-level courses as a nontraditional university alumnus (e.g., the standard 4-year bachelor's degree program requires 120 SCH and completion of 40 college-level courses). Ileri is also a product of the District of Columbia Public Schools and graduated from Benjamin Banneker Academic High School.
His global business perspective, cross-cultural competency, collaborative network and strategic alliances, affiliation with the Nitro Realty Network, and good standing memberships with the worldwide networks of the National Association of REALTORS®, and other professional industry organizations, provides his private commercial investment sales and consulting practices with the global and business resources to help individual clients and customers succeed in achieving their personal and financial goals in the 21st Century business environment.
Ileri is a native Washingtonian of Nigerian and American descent who grew up being influenced by various African and Caribbean cultures. His multicultural life experiences have shaped him personally. And defines his global perspective and outlook. His interests include art, music and entertainment, boxing, MMA, fitness, biking, reading, traveling, spirituality, international business, and spending time with friends and family.
He holds two professional real estate salesperson licenses and is commissioned to provide brokerage services in the U.S. jurisdictions of the District of Columbia and Maryland. Ileri also has ownership interests in other "non-broker affiliated" independent business ventures, including Wazobia Media, IEO Capital, and Ileri University.
Nitro Realty is not affiliated with Ileri Consulting.
Adult Learning and Postsecondary Education Experience
(College Credit, CE Credit, and Non-Credit Studies)
* University of Maryland Global Campus (UMGC), Business Administration and Communications
* Howard University (HU), Business Administration and Marketing
* University of the District of Columbia (UDC), Electrical and Electronics Engineering
* Coldwell Banker Real Estate School (CBRES), Real Estate Principles and Practices (Pre-Licensing Coursework)
* Professional Development and Advanced Continuing Education (CE) Coursework: Personal Selling and Sales Management, Independent Consulting and Real Estate Counseling, Marketing and Personal Branding,
Commercial and Investment Real Estate Brokerage, Business Brokerage, Small Business Management
and Finance, Self-Employment Law and Taxes, Self-Employment and Entrepreneurship, Real Estate
Investments and Financial Analysis, Ethics, Fair Housing, Customer Service, Basic Business Appraisal,
Business Valuation, Personal Development and Success Programs, and other Adult/CE Training Programs.
Professional Societies and Memberships
* National Association of REALTORS® (NAR) - NAR Commercial/NAR Global
* Maryland Association of REALTORS® (MAR)
* Greater Capital Area Association of REALTORS® (GCAAR)
* District of Columbia Association of REALTORS® (DCAR)
* National Association of Sales Professionals (NASP)
* Institute for Mergers, Acquisitions, and Alliances (IMAA)
* National Association of Real Estate Advisors (NAREA)
* Bright MLS (Bright)
* REALTORS® Political Action Committee (RPAC), Member Advocate
* REALTOR® Party, Member Advocate
Professional Licensing Boards
* District of Columbia Real Estate Commission
* Maryland Real Estate Commission
Postsecondary Credentials and Qualifications
* District of Columbia Real Estate/(Business Opportunities) Salesperson License (since 2000)
* Maryland Real Estate/(Business Opportunities) Salesperson License - Commercial Designation (since 2000)
* District of Columbia Real Estate Pre-licensing Education Certification (CBRES)
* Professional Development Certifications (various Continuing Education (CE) programs)
* REALTOR® (qualified member of the National, State, and Local REALTOR® Associations)
* More Than 25 Years' of Work Related Skills, Abilities, and Experience
* Varied Academic and Vocational College Training and Experience
* Small Business Financial Success and Failure Experience
* Current Small Business Owner and Entrepreneur
* Previously Owned and Operated Four Different Businesses
* Mixed-Use (Residential/Commercial) Investment Property Ownership Experience
Please Note: It is customary in the commercial investment brokerage and business brokerage industries to refer to a licensed salesperson as a "broker" even though the practitioner may not hold a principal or sponsoring broker's license. "Broker" can mean a real estate licensee (including sponsoring brokers and sales associates) acting as an agent or in a legally recognized non-agency capacity. Business brokers are also called "intermediaries" or "business transfer agents." ¹Ileri pronounces his last name OH-goon-FEE-dee-TEE-mee.
Nitro Realty is our sponsoring broker and strategic business partner. Nitro Realty is a cutting edge, versatile, agent-centric, multijurisdictional, and multidisciplinary (residential/commercial) brokerage firm. It is forward thinking and provides modern technology, marketing solutions, administrative and management support, infrastructure resources, and expert guidance for their affiliated independent real estate practitioners to best help clients reach individual goals.
The firm is an organizational network of sales entrepreneurs as opposed to corporate sales employees. Its independent sales associates (ISAs) are private contractors in business for themselves, but not by themselves, and trained for today's complex marketplace and engaged in all areas of real estate brokerage.
Nitro Realty's ISAs are fiduciary service providers obligated to put your needs first. In an industry where most companies focus on the average agent, Nitro Realty is the company with the systems and tools designed for the productive real estate professional - enabling them to better serve the market, and ensuring a superior experience for you - the client.
Whether you wish to buy, sell, lease, or invest in real property, Nitro Realty offers Full Service Real Estate Solutions to assist you in achieving your goals for leasing, buying, or selling real estate. The Nitro Realty brokerage, management team, and its independent real estate associates have the in-depth experience and presence to assist you in obtaining your real estate needs or financial goals.
The firm is independently owned and operated by highly experienced real estate professionals who understand today's multifaceted marketplace and strategically continues to make real estate work for its represented clients. Nitro Realty serves America's Mid-Atlantic and South Atlantic Regions and is licensed in 7 jurisdictions: Washington DC, Maryland, Virginia, Pennsylvania, West Virginia, North Carolina, and South Carolina.
The Nitro Realty brokerage firm is a REALTOR® member of the National Association of REALTORS® and subscribes to its Code of Ethics and Standards of Professional Practice. Nitro Realty is also a member of the regional Multiple Listing System (MLS) and cooperates and collaborates with residential and commercial practitioners in the brokerage business community. The firm is dedicated to providing competent, professional-level service and real estate solutions that fit your needs in the following areas:
Seller / Landlord Representation
Residential Sales and Leasing
Investment and Distressed Sales
Commercial Sales and Leasing
Buyer / Tenant Representation
First Time Home Buyers
Residential and Commercial Tenants
New Construction Buyers
Bank Owned / Fixer Uppers / Government Sales
Investors / Business Owners / Landlords
Land / Lots
OUR BRAND PHILOSOPHY
Ileri Commercial is a business opportunities and commercial-investment sales practice which operates within the Nitro Realty brokerage house. Our professional practice is structured as a "business-within-a-business" and utilizes the resources and sponsorship provided by Nitro Realty to achieve results for our clients and customers.
Nitro Realty is an organizational network of independent contractor sales entrepreneurs rather than an organizational hierarchy of direct sales or corporate sales employees. This unique entrepreneurial culture differentiates our relationship with Nitro Realty from the traditional corporate commercial real estate culture and business brokerage organization by giving us the freedom and flexibility to not only own and operate a small business within the firm, but also serve consumers in our own special way.
Our business and sales philosophies are consumer-centric and built on a Professional Independent Consulting and Personal Customer Services platform. Both of which have been incorporated into the traditional transaction-based brokerage (i.e., working "on spec" or "on speculation" or "venture") business model.
The resulting benefit is that individuals and small business executives can receive objective, confidential, and unbiased consulting-based services to support their decision making process without feeling pressured to sell, lease, or purchase a business or real property.
The Ileri Commercial business approach is consultative, individualized, and creates a mutual win-win for clients, customers, and its strategic business partners (The Win-Win Philosophy). As a qualified REALTOR® member of the NAR Network, and good standing member in other trade associations, Ileri Commercial is guided by professional business ethics and standards of conduct further differentiating us from ordinary practitioners.
Our adherence to professional and ethical standards (in addition to the legal fiduciary duties) demonstrates our commitment to treating clients, customers, consumers, and other industry professionals honestly and equitably in business transactions.
At Ileri Commercial, we also implement confidentiality policies according to the professional standards established by NAR and industry business ethics to protect clients' and customers' privacy rights. We practice discretion and do not disclose sensitive proprietary data, trade secrets, and information on our clients and customers without permission.
We believe in creating additional value by staying focused on helping clients and customers achieve their strategic goals by first identifying their specific objectives, needs or problems before attempting to provide custom-tailored solutions.
And finally, we are proud to be entrepreneurial commercial brokers engaged in professional sales and marketing. Many people have an aversion to selling, viewing it as a necessary evil - or at best, an unfortunate task. Much of this distaste comes from a misunderstanding of what selling is.
Selling (especially "professional selling") is not talking customers into purchasing things they don't want, professional selling is offering customers solutions to problems they face and making it easy for them to acquire these solutions.
In the business world, sales and marketing are critical elements of business success. Sales, in particular, is a unique profession when compared to many traditional technical professions in that it is an entrepreneurial or "business" vocation.
Sales is a common denominator of every business and a driver of business growth and the free-enterprise system. And so, is a central part of business development. This is one of many reasons why professional salespeople are an indispensable asset to the world economy.
Salespeople are business professionals engaged in commerce and direct (personal) selling. Their commercial activities not only contribute directly to the top line (sales revenue) of the Profit and Loss financial statement, but are also responsible for the distribution of ideas, goods, and services in the marketplace.
Without sales and salespeople, businesses and consumers would be adversely impacted. Businesses would have no profits, and therefore, no business. And consumers would have limited or no access to the goods and services required for day-to-day living.
Therefore, as professional salespeople, our job is to not only perform the technical aspects of the transaction or assignment (client and administrative work), but to also develop positive business results for our clients while simultaneously delivering solutions to meet market demand or customer needs.
Our contemporary, customer-focused sales and marketing training has prepared us with in-depth interpersonal sales communication skills, sales management abilities, product and market knowledge, strategic business and marketing planning skills, and sales promotion techniques.
This knowledge base has enabled us to become business development specialists and revenue producers (rainmakers) for our respective stakeholders. Like many of our clients and customers, we are self-employed entrepreneurs operating in a globally competitive business environment that is in constant flux.
So we know firsthand the challenges faced by most entrepreneurs, small business owners, investors, and company executives. Our varied roles as independent sales and marketing professionals, and commercial-investment practitioners place us in direct contact with the real estate and business opportunities marketplace.
As active market participants, we are able to obtain frontline marketplace intelligence and feedback for the benefit of our clients. So we are perfectly positioned to help our clients and customers achieve their targeted personal and financial goals. For a confidential conversation to discuss your wants and needs, please contact us today.
FACT #1: NOT all real estate agents are REALTORS® and NOT all REALTORS® are real estate agents. The REALTOR® term doesn't mean "residential real estate agent" or "real estate agent."
The REALTOR® term is a trademark owned by the National Association of REALTORS® (NAR) and protected by federal law. The REALTOR® designation represents a real estate professional who is a member of NAR and subscribes to its strict Code of Ethics and Standards of Practice.
Out of the more than 2 million actively licensed real estate practitioners in the U.S., only about half are REALTORS® or members of the National Association of REALTORS® (NAR). The NAR is the world's largest business trade association.
Its membership is composed of residential and commercial brokers, salespeople, property managers, appraisers, counselors (i.e., consultants and advisors), international real estate professionals, and others engaged in all aspects of the real estate industry in the United States and throughout the world.
Commercial specialists make up about 10% of all NAR members.
FACT #2: Only REALTORS® subscribe and are obligated to abide by a strict national and global Code of Ethics and Standards of Practice.
The REALTORS® Code of Ethics and Standards of Practice is revised annually to reflect the latest issues in real estate law and professional practice. The REALTORS® Code of Ethics was the precursor to U.S. state licensing laws which govern the entire real estate brokerage industry.
Additionally, because the REALTORS® Code of Ethics and Standards of Practice goes above the fiduciary standards required by law (similar to attorneys, CPAs, physicians, and other professional practitioners), the REALTOR® designation represents a competent real estate agent or business professional who aspires to a higher moral standard of professional real estate and business conduct; driven by uprightness, honesty, sincerity, and integrity.
REALTORS® can be sanctioned for violation of the Code of Ethics. (Watch this video to learn more about the REALTORS® Code of Ethics).
FACT #3: Most REALTORS® are (academic) college educated.*
Academic education of REALTORS®:
Some undergraduate school: 30%
Bachelor's degree: 30%
Graduate degree and above: 13%
Associate degree: 13%
Some graduate school: 6%
High school diploma: 8%
*In addition to their academic education, most REALTORS® have completed some form of specialized professional or vocational education or training at a career college.
FACT #4: Though affiliated with a brokerage firm, 86% of REALTORS® are Self-Employed "1099" Independent Contractors (ICs) or private practice sales professionals with a majority operating their professional business practice as a proprietorship (a one-owner or spousal shop) while a few other REALTOR® professionals run their small business as partnerships, limited liability companies, or corporations.
Only 5% of REALTORS® are actually direct employees of the brokerage or corporate firm while 9% of REALTORS® have other types of work relationships with the brokerage or corporate firm.
When REALTORS® are real estate agents, state licensing laws, in addition to federal laws and the broker's business model, ultimately determine the broker and salesperson work relationship.
In the industry, there are one of three possible types of relationships which can exist: employee (common-law employee), common-law independent contractor, or statutory independent contractor.
Source: 2018 NATIONAL ASSOCIATION OF REALTORS®' Member Profile, NAR Media Resources
Note: Direct sellers (e.g., independent direct salespeople or business owners, selling consultants, sales representatives, distributors, and network marketers) are also considered to be statutory independent contractors. There are many similarities between the direct sales business model and real estate brokerage business model. The Direct Selling Association (DSA) defines direct selling as "a business model that provides entrepreneurial opportunities to individuals as independent contractors to market and/or sell products and services, typically outside of a fixed retail establishment, through one-to-one selling, in-home product demonstrations or online. Compensation is ultimately based on sales and may be earned based on personal sales and/or the sales of others in their sales team."
Regardless of the type of independent contracting relationship established between the broker and salesperson, there is no such thing as a "1099 Employee." It is a mythological creature. Statutory and common-law independent contractors are self-employed workers who are not classified as employees for tax and other legal purposes.
However, there is a "W-2 independent contractor" hybrid classification called statutory employee. Statutory employees (e.g., traveling or city salespeople, life insurance salespeople, certain agent or commission drivers, and certain home workers) are independent contractors that are treated as direct employees by their employers.
Statutory employees are not self-employed. They are "self-employed" only for tax reporting purposes. Please visit Wikipedia or the IRS website on this topic by going here.
In contrast, service providers who are 1099 ICs are self-employed. They are either a sole proprietor or co-owner of a business.
Sole proprietors and other self-employed individuals (such as partners and some limited liability company members) are not employees of their own business, the client's business, or the hiring firm's business. They are simply small business owners and operators of a commercial enterprise (i.e., principals or "their own boss").
Therefore, unincorporated independent contractor (IC) real estate salespeople are also bona fide owners of a proprietorship or partnership within their affiliated brokerage firms. Under this arrangement, the brokerage house is the IC salesperson's strategic business partner, peer, internal client, and sponsor rather than their direct employer.
Inversely, IC real estate salespeople or associates are also internal clients of the brokerage firm. This unique business relationship is in contrast to the historical and traditional management perspective involving a boss and subordinate or employer (master) and employee (servant).
WHAT IS (COMMON-LAW) INDEPENDENT CONTRACTING?
Independent contracting is a business venture and way of doing business. It is a personal or business service to an individual or firm provided by another individual or firm for pay under contract.
The services provided may be legal, medical, architectural, in real estate, design, construction, accounting/auditing, engineering, advertising, public relations, writing/editing, sales, or any other area.
The independent contractor must be free to offer services on the open market, not just to one person or firm. And the independent contractor must not be controlled in the manner in which the work is accomplished.
If an independent contractor fails to be differentiated from an employee, irrespective of the contractual relationship, the IC will lose his/her status and benefits as an independent contractor. In such a case, the client or prime contracting firm may well be described as the ICs employer and subjected to the employment labor and tax laws - including federal and state financial penalties for worker misclassification.
However, in the real estate brokerage industry, the statutory independent contractor (non-employee) classification does provide brokerage firms with some degree of control over how the work is accomplished without the elimination of the independent contractor's self-employment status and without imposed penalties (see Real Estate Worker's Classification Chart below).
The statutory non-employee classification only applies to real estate agents and direct sellers.
LEGAL BUSINESS OWNERSHIP STRUCTURE OPTIONS
It is important to note that self-employed individuals (i.e., 1099 ICs) can own and legally structure a single-person business (solo practice) or group (team) practice either as a sole proprietorship, partnership, limited liability company, or corporation. The default legal business structure for an unincorporated (single- or multi-person) business enterprise is sole proprietorship.
The sole proprietorship structure is the easiest business organization to establish and refers to the number of owners in the enterprise and not to the size or scale of the business. A sole proprietorship is simply one of the four legal forms of business organization with it being no less significant than the other business structures.
Each type of business organization offers unique benefits and is usually chosen based on the goals and objectives of the business owner(s). It is often presumed that a sole proprietorship is always a one-person operation (i.e., individual or sole practitioner firm). But this is not always the case.
For example, a one-ownership business can have one employee, a few employees, several hundred, or thousands of employees qualifying it to be considered a multi-person firm. Therefore, the one-owner business can be a small-size, mid-size, or large-size venture.
There are no legal restrictions on the number of employees and/or non-employees that a sole proprietor (owner) can either employ or contract with, respectively. Of all the business forms, the sole proprietorship gives the owner the strongest control over their business since they have no partners to consult with on decisions or board of directors to satisfy.
The sole proprietor may have employees with varying degrees of accountability, but the ultimate decision-making responsibility rests with the owner. When a business is organized as a sole proprietorship, which by the way is the oldest form of business organization, the nonemployee-owner of the business is operating as a "natural and mortal person" having complete decision making authority and total (unshared) ownership of the business' assets and liabilities.
If the business is organized as a corporation, the incorporated business becomes an "artificial legal and immortal person" having decision making authority, ownership of the firm's assets, and responsibility over the firm's liabilities. As an artificial person, a corporation can sue, be sued, hold title to, lease, and sell property.
It can enter into contract agreements with individuals, other corporations, partnerships, government bodies, and perform many of the same activities as a natural person. So essentially, the corporation becomes the proprietor's stand-in ("corporate shield") and the proprietor becomes an employee-owner of the corporation or "corporate citizen."
When a proprietor becomes an employee-owner of the corporation, the proprietor is "corporate-employed" and no longer considered to be self-employed nor required to comply with the Self-Employment Laws and Tax Regulations.
Conversely, corporate-employed owners are subject and required to comply with the Labor and Employment Laws and Tax Regulations. The Labor and Employment Laws only become applicable to self-employed business owners when they choose to hire direct employees or become an employee of their own corporation.
Partnerships (general and limited) are formed when two or more sole proprietors decide to work together as a team or group. Limited liability companies can be either single-member, partnership member, or incorporated enterprises. For further information on this topic, please consult appropriate business advisors and additional resources.
BROKERAGE FIRM BUSINESS MODELS
IC real estate agents purchase (via revenue sharing arrangements or fee splits, and payment of other broker assessed fees) the right to come under the brand logo of the company they affiliate with (i.e., hang their license) and to use the brokerage or hiring firm's resources.
Consequently, the broker-salesperson IC relationship is more analogous to the prime contractor-subcontractor or franchisor-franchisee (entrepreneurial) model than to the traditional, hierarchical employer-employee (command-and-control) model. In other words, the broker-salesperson IC relationship is a strategic business alliance interdependent on one another's success.
The prime contractor-subcontractor/franchisor-franchisee model is used throughout the business world and across various industries including, but not limited to, personal grooming, construction and development, sales and direct selling, entertainment, and financial services. The real estate services industry is no exception.
In real estate brokerage, there are two popularly used contracting business models that tend to run parallel to the statutory and common-law independent contractor work arrangements: Agent-Centric Model and Broker-Centric Model. Agent-centric firms promote an entrepreneurial business culture and operate according to the common-law independent contractor practice standards. (See Real Estate Worker's Classification Chart below).
Broker-centric firms, on the other hand, promote a traditional (command-and-control) work culture and operate according to the employee or statutory independent contractor practice standards. Direct sellers and real estate agents are classified as statutory independent contractors at the federal level.
It is important to note, however, that state laws ultimately determine the broker-salesperson relationship and can supersede the federal laws. If a salesperson is a statutory independent contractor for federal tax purposes but a common-law independent contractor for state tax purposes, the broker must adhere to the standards applicable to the most restrictive of the two types of relationships.
In most instances, the most restrictive are those standards applicable to the common-law independent contractor. (Here is a Worker Classification Chart comparing the different work relationships and practice standards existent in the real estate brokerage industry).
Because the broker and IC salesperson are forming a strategic relationship based on a business-within-a-business concept, the work arrangement does not strictly adhere to the traditional corporate employment hierarchy model.
Although brokerage firms play a supervisory or sponsorial role, real estate agents are starting a small independent personal/professional services business (typically a solo or partnership sales practice in their legal name(s) or personal brand) when they affiliate with a brokerage firm as a standard 1099 independent contractor sales professional or entrepreneur.
Another name for the type of business being started by an IC agent is small office/home office (SOHO) or home-based business (HBB). Therefore, IC sales agents are in business for themselves, but not by themselves. This is true regardless of the type of IC relationship the salesperson has with the brokerage firm since there is no such thing as a "1099 Employee."
However, as previously mentioned, there are significant operational differences between the agent-centric and broker-centric business models, and 1099 IC versus W-2 IC classifications. IC sales agents operating under the agent-centric model are typically private practitioners where there are no corporate job titles, seniority system, and bureaucratization. There is also not a "bottom," corporate ladder to climb, or corporate interference.
Many REALTOR® sales professionals (especially residential practitioners) are affiliated with agent-centric firms and operate autonomously. In contrast, IC sales agents operating under the broker-centric model are typically corporate practitioners having traditional job titles and whose work environment involves a company seniority system, and bureaucratic company structure.
In some cases, corporate practitioners are direct employees of the firm instead of standard independent contractors. Corporate practitioners may or may not be REALTORS® or members of the National Association of REALTORS®, or any of NAR's affiliated organizations (e.g., CCIM, SIOR, CRE, and CPM).
Brokerage firms are not obligated to join the NAR or its affiliates. Many commercial firms and practitioners operate on the broker-centric platform.
THE BUSINESS/ENTREPRENEURIAL MINDSET AND WORKER MISCLASSIFICATION
Top level salespeople in all industries, whether company-employed or self-employed, REALTOR® or non-REALTOR®, statutory or common-law IC, think and act like the owners of their careers or a business.
It is more than just a technical orientation. Psychologically, they have adopted a Serious Business Attitude (SBA) rather than a Marginal Business Attitude (MBA); developed a "business owner" mentality versus an "employee" mentality; they have moved from paycheck to profit thinking.
Unfortunately, there are some real estate agents, teams, and real estate offices that have not made the mental shift and overlook the "business-within-a-business" and entrepreneurial framework of real estate brokerage as well as the unique work relationships used in the real estate and professional sales industries.
And instead, encourage the misconception that 1099 independent contractor salespeople or independent sales associates (ISAs) are direct employees or sales personnel of the house or team. These misconceptions have led to a recent wave of litigation (see NAR's white paper) within the real estate industry regarding the Independent Contractor versus Direct Employee worker classifications.
It is possible that some brokerage firms may mistakenly confuse the idea of 1099 independent contractors with the "W-2 independent contractor" (statutory employee) classification since there are allied industries (e.g., corporate sales and insurance) that use independent contractors that are also treated as employees.
Nevertheless, there are people and organizations such as ClassAction.com who continuously challenge companies that are negligent in the use of independent contractors in the business and real estate arenas. With many calling for a crackdown on improper worker classification because they believe that employers classify workers as independent contractors simply to avoid existing requirements of state and federal labor law and employment benefits (i.e. overtime pay, vacation and sick leave, employer Social Security contributions, workers compensation requirements, health insurance employer mandate, etc.).
Additionally, there are several federal and state agencies that audit businesses for misclassifying employees. There are also employment attorneys who specialize in real estate agent misclassification.
The NAR strongly supports the continued right of brokers to choose whether to classify agents as employees or independent contractors. NAR also supports actions at the state level to strengthen the rights of brokers to make these determinations and will resist any efforts at the federal level to weaken those rights.
The links above and following links have been provided for further study on this subject. Click here for more information or please visit NAR's website on this topic by going here. Also see NAR's Independent Contractor FAQ. Also see NASE's Difference between Independent Contractor and Employee video.
INMAN News has also published the following article on this topic as well: "Real Estate Independent Contractor Lawsuits Explained."
In summary, the real estate services industry is fascinating and offers several unique career opportunities to work either in corporate or private practice. Real estate offices, teams, and principal brokers have three basic choices when building their field sales force: 100% company-employed (direct) salespeople, an independent (outsourced) affiliated sales force, or a combination of these two.
IC real estate sales agents or ISAs are not traditional in-house employees of the company or real estate team regardless of the type of contracting relationship - i.e, statutory or common-law.
Real estate ISAs are self-employed service professionals and business owners (entrepreneurs) who should be treated as peers strategically partnered with the real estate office or team to achieve a mutually desired objective: distribute new product and service solutions, provide customer service, and generate revenue and profit in order to satisfy individual goals, and meet the company's or team's sales channel needs.
Industry practitioners are strongly encouraged to read the book developed by NAR's Legal Team, Real Estate Brokerage Essentials®: Navigating Legal Risks and Managing a Successful Brokerage, Fourth Edition for more clarification on the different worker classifications within the real estate brokerage profession. The manual is regarded to be the most comprehensive tool to run a brokerage business efficiently and minimize risk for legal liability. Highly recommended.
CLIENT NEEDS ASSESSMENT
We utilize a two-step consultative approach when serving clients and customers. Our first step involves a Client Needs Assessment which is a "No-Charge Diagnostic Service" and an opportunity for a personal and confidential exploratory one-on-one conversation.
You should anticipate that our initial meeting will be approximately 45 minutes to 1 hour. In some cases, discovery sessions will be completed in 30 minutes or less.
The purpose of our meeting will be to identify your current need, issue or concerns, determine whether we can be of help, gather pertinent information, and get acquainted. Upon mutual agreement, we will advance the relationship to the second step involving the project estimate or proposal presentation and service agreement stage. After project proposal and/or contract acceptance, we will initiate work on your assignment or project.
Final professional service fees are determined after the initial assessment and evaluation of your project assignment and scope of work. Our fees are based on the complexity and financial risk level of the assignment. And are established for client approval before work is begun.
For Private Consulting Assignments: In order to provide you with more flexibility in obtaining customized solutions, variable advisory and consulting project fee arrangements are offered and charged on a non-contingent fee basis (e.g., flat fee, hourly, per diem (daily), milestone, or progress payments).
In some cases, consulting assignments may also require a non-refundable engagement fee deposit or start-up payment to begin the engagement with subsequent payments due at the middle and/or end of the consulting assignment. Client representation services are not provided on consulting engagements.
For Brokerage Assignments: Brokerage assignments are provided on a per-task contract basis. In compliance with the National Association of REALTORS®' Code of Ethics and Standards of Professional Practice, Standard of Practice 12-1, brokerage service commission fee arrangements are offered on a contingency fee basis (services are not "free") and charged after delivery of services and attainment of results in the sale, lease, purchase, or exchange of real property and sale or purchase of business opportunities.
Contingency fee arrangements makes it easier for clients to obtain professional brokerage sales or leasing services without having to pay hourly, up-front engagement, daily, and/or intermediate fees (progress and milestone payments) during the brokerage assignment. Essentially, clients are able to fund their sales or leasing project with the anticipated proceeds of a successful transaction closing.
There are some instances when clients can be charged for the sales and marketing expenses, but this depends on the requirements of the specific case. Otherwise, we cover or "finance" the project's sales effort (e.g., tools and materials, signage, marketing, labor, administrative, business resources, research, and other direct costs).
By financing and managing the brokerage assignment, we are able to reduce our client's time and mitigate their financial costs in the sale, lease, or purchase of a business opportunity or real estate. Clients do not have to pay out-of-pocket project expenses nor professional service fees unless the client has a successful brokerage transaction.
Additionally, you will never be under any obligation to enter into a service agreement at the initial meeting or at any time during the project assessment period. As private practitioners selling personalized services and solutions and investment assets, we adhere to professional contemporary selling standards and business ethics.
We do not engage in conventional, outdated, unethical, high-pressure, pushy, manipulative, deceptive, or illegal sales or business practices. We have adopted the motto: "Sales is service, and service is sales."
If we think we can help you in any way, we will tell you and ask for a little more time to learn more about your case or scope of work. On the other hand, if there does not seem to be a need for our services or it becomes apparent that our services are not the best solution for your wants or needs, we will tell you and recommend another service provider, if appropriate.
We strive to work with each of our clients and customers to understand the challenges at hand, determine the goals of the engagement and develop strategies and tactics to meet and exceed the defined objectives while at the same time operating in a relaxed and non-threatening business environment. We respect and value the abilities and perceptions of our customers and client-partners.
To get started, contact us today. We look forward to meeting with you.
Please Note: Brokerage commissions and transaction costs, consulting fees, and other service fees may be tax deductible. Please consult your business tax professional.
We focus on performance and results.™
ILERI COMMERCIAL AND NITRO REALTY
Ileri Ogunfiditimi, REALTOR®, LREA, BC
Principal/Independent Commercial-Investment Salesperson
Tel: +1-888-444-9964, Ext. 123
Private Business Hours (EST): Monday-Friday, 9am-4pm; Weekends: Limited Availability; Holidays: Closed.
Virtual, Telephonic, and In-Person Meetings Available (in compliance with federal, state, local, and CDC COVID-19 Guidelines). Appointments Only.
Document Drop-Off/Shipping Center (Washington, DC)
The UPS Store
455 Massachusetts Avenue NW, PMB# 232
Washington, DC 20001, USA
(Mailing center is a Designated Essential Business and remains open. Please click on hyperlink for hours of operation).
Matt Staup, REALTOR®, LREA
Administrative Manager and Marketing Services Associate
Tel: +1-888-444-9964, Ext. 299
Main Office/Branch Office Business Hours (EST): Monday-Friday, 9am-5pm; Weekends and Holidays: Closed
Bethesda Headquarters Office
Ileri Commercial/Nitro Realty
10411 Motor City Drive
Bethesda, MD 20817, USA
Serving Clients Since 2000. Local Expert. Global Connections. Thank you for doing business with us.