Thanks for returning for part III of our series.  On Monday we discussed The Finance Package and Wednesday The VTB Discussion.  Realtors need to appreciate that the buyers of commercial or likewise investment properties are doing so to make a profit; a business decision, and as such, it usually comes down to the numbers. Given this assumption there are several things realtors can do to maximize the value of the property they are listing and facilitate quality offers from qualified buyers.  Our final suggestion to the realtor selling commercial real estate: know your role in the process.

Your primary role in selling a commercial property is not to maximize the selling price for the vendor. Let me repeat this. Your primary role in selling a commercial property is not to maximize the selling price for the vendor. Your role in the process is to facilitate a business transaction between vendor and buyer where both parties are satisfied with the transaction.  This is not done by taking an adversarial position with the buyer or the buyer’s agent. You role as negotiator may be limited, because sophisticated vendors and buyers may be skilled in this area and it would not be unusual for a buyer to take his offer to the seller directly. The concept of leveraging a higher price through “multiple buyers” that may exist in a residential setting is less of a motivation in commercial deals, as buyers know that the cash flow and debt servicing is key. Overpaying for a property will make little sense to them and they will simply move on to the next property.

Your best strategy is to present all the information that is available, co-operate with the buyers in obtaining financing and work to insure that all the buyer conditions can be met. You will be pleasantly surprised with how easy commercial deals can be consummated.  The time you save will ultimately free you up to work on the next deal and your reputation as a facilitator of commercial deals will grow.

At Casb Management Group Inc., we help prepare lender packages. We have written articles on how to position clients for commercial financing, and are always happy to assist.

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