Selling Your Commercial Real Estate: 4 Things You Need to Know
If you are considering selling commercial real estate there are various considerations and requirements to be aware of. Working with a team whose members have the knowledge, experience, and success record to sell your type of commercial property whether it be Retail, Industrial, Office, Medical, Land, or Multifamily is essential.
A well-thought-out strategy can enhance your bottom line by thousands of dollars while reaching your commercial real estate goals. The strategy is formulated while making a multitude of decisions in preparation of listing your commercial real estate: Should you pocket the proceeds or reinvest in something else in or out of a 1031 Exchange? Is your building held in an LLC that you may want to divest from before closing? How much should your property be priced at? What price can you expect it to close at and how long will it take? Is there a certain type of buyer that would be most likely interested in your property such as an Owner/User, or an Investor?
The best way for you to sell a commercial property depends on a number of variables, but there are some consistently important elements of a successful go-to-sale strategy
1. Surround Yourself with Experts
experienced Commercial Real Estate Broker can help you align your goals and
objectives with the experts needed to facilitate a successful sale. Some of
these experts may include a real estate attorney, CPA, 1031 Exchanger, Title
company, and of course your Commercial Real Estate Broker.
As you choose your Broker, find a Commercial Real Estate Broker who has the experience and resources necessary to sell your commercial property. Keep in mind that a Residential Agent primarily sells houses and their work vs. a Commercial Broker’s work are vastly different.
Arguably most important, ensure the Broker is listening to you and fully understand your needs. Are they asking relevant questions based on your objectives? Are they able to communicate with you effectively? If so, then they are likely a good fit.
2. Understand the Process
Once you’ve found a Commercial Real Estate Broker to fit your needs, they will begin the process. They will help you establish pricing for your property through a combination of various industry methods often including the Market approach, the Income Approach, and sometimes including valuation for redevelopment depending on your asset type and target buyer.
Brokerage firms stay informed with the current industry and economic trends, as well as any significant recent comparable sales. They will provide you with sale comparables which are used to establish list pricing as well as guidance to anticipate how long it will take to sell your property, and the expected ratio between the property listing price, and the sold price. They will walk you through the entire process so that you can anticipate what will happen.
Most importantly, having a trusted broker on your side will ensure you don’t mistakenly sell your property for less than what it’s worth.
Your broker will produce signage and marketing materials, advertise the property for you, screen inquiries, tour the property with prospects, lead the negotiation with a buyer, and essentially work on your behalf from listing to closing.
Once your property is ‘under contract’, which means there is a Purchase and Sale Agreement signed by both parties, the average amount of time it will take to close is 60 days. If the property is going to be redeveloped, the time it takes to close can be up to 1 year. Your broker will work to ensure all parties follow all necessary steps needed to close the transaction.
3. Implementing an Integrated Marketing and Sales Plan
Creating a multifaceted marketing strategy that includes commercial real estate listing services, social media marketing, content marketing, email marketing, video content, and Internet search engine optimization is essential to attract and convert buyers. Marketing tends to be an area that differs greatly from brokers and companies, and a highly optimized and proactive plan and approach can increase the visibility of the property to prospective buyers and reduce the time to sell.
In addition to traditional marketing strategies, seasoned brokers have an extensive contact list of potential buyers in which they can present your property directly to these individuals, thus increasing your property’s exposure.
4. Assuring a Smooth Closure
If the major steps are carried out correctly, things should progress smoothly. However, many unforeseen issues can and do come up in a typical commercial real estate transaction. Working with an experienced commercial real estate broker can be beneficial to a seller when they need to problem solve and overcome obstacles that may hinder the sale.
Why Commercial Real Estate NW?
Our vast experience in Buying, Selling, and Leasing commercial property becomes evident during the sales process. Sometimes selling is not the best decision, and our team can guide building owners through those variables of selling vs. leasing while holding our client’s best interest at heart.
We understand the nuances of various buyers and sellers and will help you make the best decision regarding offer responses, and buyer engagement.
Timing and Pricing are critical elements to manage. At Commercial Real Estate NW, we provide Broker Opinions of Value of your property as a courtesy and we also have a Project Manager closing tracking time sensitive steps along the way.
Most of all, at Commercial Real Estate NW, our clients' interests are held in the highest regard while maintaining client confidentiality. We are your Commercial Real Estate Resource for buying, selling, and leasing Commercial Property.