Another focus is on learning and training. I’m very big on that. We have different levels--emerging brokers training is for our first-year students and it’s an award-winning program. As a result, we have a retention rate of 72% to 75% and that’s even with the downturn. We also have mid-level learning, which is for our brokers who have anywhere from three to 20 years in the business. Just because you’ve been successful for the past 15 years doesn’t mean you are going to be successful going forward. The clients and the market have changed so it’s important all of our brokers stay on top of market trends. Also, with our office owners and managers we have a lot of player/coaches out there. We’ve invested a lot of time and effort training them. For instance, any given manager’s role involves planning, organizing, recruiting, directing, controlling and training. Those are the requisite skill sets in running an office. But not everybody is strong in all of them.

The bottom line is that we are getting our name out there and talking to folks. Also, we’re doing a lot with social media and social networking including Twitter and Linked-In. We need to be there now. One of the benefits is that our consumer interface on the residential side is very knowledgeable about the social networking component and, therefore, that skill sets has transferred over to us. Sharing information between divisions is one of the benefits of this organization--even the cross-selling of services between commercial and residential.

GlobeSt.com: You mentioned distress and we have a digital publication, Distress Assets Investor, which is devoted to this topic. How do you see the market playing out in the years to come?

Schmidt: It’s not like the RTC days in the early 1990s. That was a commercial downturn. You had a five-year oversupply of office space and a three-year supply of industrial space. This distress is really demand driven. We’re starting to see a slow, cautious optimism but with a very low interest rate from the Fed, banks are slowly writing down their distress on a quarter-by-quarter basis. It’s not the overload or the dumping on the marketplace that they did in the RTC days. It’s a slow burn, if you will.

GlobeSt.com: What about all of the CMBS debt that is coming due?

Schmidt: There were dire concerns a year ago and while nobody is widely optimistic now, the market is straightening out and we’re getting a correction. We’re finding bottom. The gap between buyers and sellers has closed. Now, again, with distressed assets, putting financing and capital into those types of properties versus core assets that are cash flowing is a very different game. In the case of the latter, the LTVs, risk premiums and adjustments are still there. Having said that, the opportunity to create real wealth is in that area with value-adds--buying those types of properties and upgrading them. So we’re seeing the recovery rates on distress a lot higher than we thought they would be. And it’s moving forward and doing better than we initially thought.

Year-over-year, the numbers are up on property and investment sales. We’re still seeing excess supply in office, industrial and retail. But in the fourth quarter of 2010 we reached the high-water mark and next year we will see a slowdown. The difference is that we are not overbuilt like we were before so the market can snap back. Therefore, there’s a real opportunity to buy and invest in commercial real estate.

GlobeSt.com: What asset classes are holding up the best?

Schmidt: Oddly enough, hotels have bounced back very quickly. I think that’s because they were so damaged and went down so far, so fast. Apartments are probably the healthiest investment sector of them all right now. Vacancies are in the mid- to high-6% or 7%. And some condo owners are converting these properties into apartments. Flex/industrial space is starting to come back as are retail strip centers. Student housing is also popular.

We’re even seeing downward pressure on cap rates in office and industrial properties in major markets. For well-occupied (95% or higher), cash flowing assets, there’s real competition. In fact, there’s so much capital looking for that product, it’s driving down the returns and increasing pricing. The opportunity will be in that value-add sector. That’s where the returns are.

In terms of the marketplaces right now, the Midwest is holding up comparatively well, largely because those states didn’t go way up during the bubble. You’re seeing a gradual turnaround in certain markets there, but you need to select wisely and look at the opportunity. Take a look at Detroit--there’s a sense of optimism. I’m not saying it’s a bed of roses there but compared to where it was, the market has made some major strides.

GlobeSt.com: What are your predictions for 2011 in terms of market conditions and also your focus?

Schmidt: I would look for a slow, gradual correction in the market. Vacant supply is starting to decrease and by the end of 2011, we should see positive absorption across all property sectors. We will mirror the overall macro-economic factors so we will follow real GDP and employment when all is said and done. In terms of CBC, our presence in primarily, secondary and tertiary markets lends itself very well to continued growth. We see a tremendous shift in the brokerage business. Having brokers who are part of a larger platform and yet have the flexibility and adaptability to change on a dime is paramount.