In a market where developers are falling over themselves to offer sweeteners to buyers, one builder is targeting brokers instead.
Toll Brothers City Living is encouraging brokers to keep bringing buyers to its Manhattan and Brooklyn projects by offering a new portfolio-wide commission incentive, David Von Spreckelsen, president of the firm, told The Real Deal.
The new structure would see brokers get an extra 0.5 percent commission for every additional buyer they bring to a Toll [TRDataCustom] building. They’d get 3 percent on the first deal, 3.5 percent on the second and 4 percent on the third. The split would be capped at 4 percent from then on.
“When you get to the price points that we’re talking about, you largely see buyers coming in with brokers,” Von Spreckelsen said. “That’s how you’re getting into buildings. With the plethora of new construction out there, sometimes it can be daunting for buyers to keep track of all of these buildings. They really rely on brokers to point things out for them.”
While such an incentive has been seen in individual buildings, it’s unusual for a developer to offer it on a portfolio-wide basis, sources said. That, they said, is further evidence that developers are finding it difficult to garner attention for their projects amid a high-end condo supply glut in Manhattan.
“I think it’s brilliant and more developers should do it,” said Frances Katzen of Douglas Elliman. “It’s a clever way to maintain the broker’s interest. Your client will go with what they want in the end — it’s not like you’re going to try to get them to buy there — but it keeps it on the radar.”
Toll Brothers is offering the incentive in projects including 100 Barrow Street, 121 East 22nd Street, 55 West 17th Street, 400 Park Avenue South, the Sutton, 1100 Park Avenue, 91 Leonard Street and Brooklyn’s Pierhouse. The developer previously cut prices at several of its buildings, including 400 PAS.
“We’re thinking that, if we open it up to more buildings, it will give them a better shot,” Von Spreckelsen said.
Toll isn’t the only developer trying to sell brokers on doing business at their buildings. At Claremont Group’s 101 Wall Street, the developer recently doled out $5,000 American Express gift cards to brokers whose clients sign contracts, according to previous reports.