World history is filled with international conflicts, so today’s political climate, with its wars in Ukraine and the Middle East and trade fallout from new tariff policies, is hardly an outlier. But it poses significant obstacles to cross-border business in sectors like commercial real estate, where globalization in recent decades has stimulated growth. Nevertheless, some brokers are managing to close international transactions despite these headwinds. Several shared their strategies:
Avoiding Sensitive Topics And Manifesting Neutrality
Clients from other countries may have strong opinions about international issues. Rather than risking offense by stating a different opinion, wise brokers avoid political discussions or steer them in a different direction. Trent Frankum, SIOR, managing director of TFA Commercial Realty in Makati City, Philippines, and his colleagues employ several techniques when conversations with clients edge into politically sensitive territory: They redirect topics toward business, industry trends, or shared interests; acknowledge comments but refrain from agreeing or disagreeing with them; and use “appropriate humor or light commentary to change the tone and guide conversations back to safe ground.”
Frankum’s team also manifests neutrality by avoiding associations with organizations that could be perceived as partisan and expressions of political opinions in the public realm, which includes social media. The logic behind this approach is sound. As Frankum notes, “business relationships are rarely strengthened by political alignment, but they can be damaged quickly by perceived disagreement.”
Taking Advantage Of Unusual Opportunities
Rather than despairing over the inertia that hampers cross-border business during times of turmoil, savvy brokers recognize that a stagnant market offers a different set of opportunities.
“As many seasoned professionals might say, you make the best deal in troubled times,” says Guillaume Turcas, an affiliate member of SIOR and the managing partner of Faro Capital Partners in Paris. “Less competition in the market allows quick moves to strike first and get attractive pricing on well-located assets.” In Europe, where the Russian invasion of Ukraine had a dampening effect on the real estate market, he is now seeing deployments of private equity from funds that are trying to gain an edge over institutions that are “still waiting for the sun to shine.”
Adrian Arriaga, SIOR, managing director of the Arriaga Group in McAllen, Texas, and his colleagues view times of economic turmoil as opportunities to negotiate favorable terms or recommend markets for consideration.
Business relationships are rarely strengthened by political alignment, but they can be damaged quickly by perceived disagreement.
And Baltazar Cantu, SIOR, industrial director at Colliers in Monterrey, Mexico, finds that although the tariff-related tensions between Mexico and the U.S. have posed challenges, wider global conflicts have accelerated opportunities for nearshoring in Mexico, especially in Monterrey, which benefits from a strategic location close to the U.S. and a highly integrated supply chain.
Cultivating And Leveraging Cross-Border Relationships
Brokers who recognize the potential of new and sometimes counterintuitive opportunities have an important hurdle to overcome: They must persuade their clients to act. Here’s where time and effort spent on cultivating long-term, cross-border relationships bear fruit. According to Anthony Bergeman, SIOR, executive vice president at Daum Commercial Real Estate in Costa Mesa, California, in times of market turmoil companies lean on the brokers they trust the most. And in his sector of expertise, trust is more important than ever: He specializes in ports and logistics in the Los Angeles area, and much of the container traffic comes from China and other countries in Asia, many of which have been affected by new tariff policies.
Frankum also emphasizes the importance of trust in cross-border business, noting that it is built on relationships. Such relationships do not emerge overnight, of course. They begin with an approach that he describes as “listening more, respecting cultural nuances, and finding common ground even when perspectives differ.” Cantu offers similar advice: “Building trust and adapting to cultural expectations helps overcome government-level tensions, allowing business relationships to flourish even when official politics are strained.”
As the old saying goes, practice makes perfect. Bergeman has encountered vastly different negotiation styles in his many transactions with Asian entities across a range of market cycles, and consequently, has a general idea of what he can expect. He reminds brokers that “the more experience you gain in intercultural negotiations, the more prepared you are."
Education is also important. Arriaga recommends that brokers who wish to pursue cross-border transactions attend and participate in binational trade events and stay informed on legal and economic developments. Frankum urges brokers to do their homework. As he stresses, “This isn’t just about knowing the numbers; it’s about understanding the context in which those numbers exist.”
Good starting points for research include books like Kiss, Bow, or Shake Hands or the Culture Shock! series, or the country comparison tool on the website of The Culture Factor Group. Also, articles in past issues of SIOR Report focus on specific aspects of cross-border business, such as negotiations or digital communications.
Cross-border partnerships can come in handy. “Find and cultivate good local partners in international locations,” Frankum advises. “These relationships are invaluable for navigating local complexities and building credibility.” Arriaga also suggests partnering with experienced real estate brokers who are binational and bicultural. He and Cantu observe that the SIOR network provides an ideal basis for exploring such partnerships.
Building trust and adapting to cultural expectations helps overcome government-level tensions, allowing business relationships to flourish even when official politics are strained.
Conclusion
Cross-border transactions require skill and finesse at any time, but they present even greater challenges during periods of heightened international tension. Brokers can succeed in these endeavors, however, if they pay special attention to diplomacy in their interactions and conversations with clients, demonstrate neutrality in public, draw on the trust they’ve cultivated over the years to generate interest in unusual opportunities, adopt an open-minded attitude toward other cultures and mindsets, and seek to educate themselves on the business practices in other countries. The time, patience, and positive outlook these steps involve serve as brokers’ allies in navigating the challenges.
“Political conflicts will always exist and run in cycles,” Arriaga reminds us. “Political landscapes may shift, but strong fundamentals and long-term relationships remain the key to successful international business. Trust, transparency, and constant communication will always be more valuable than politics.”
In short, when it comes to international transactions, brokers who follow tried-and-true strategies of their experienced colleagues will find that borders do not equal limits.
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