Do you own a gas station, a shopping center, a line of retail shops, or some office spaces or convenience stores? If so, are you thinking it’s time to sell your commercial property?
Or perhaps you’re considering leasing your commercial property to other businesses. In either case, you’ll probably want to work with a commercial broker. But aside from that, there are a few real estate selling principles that will streamline a lot of your real estate headaches.
1. Price Your Property Right
The price of a residential home is calculated based on the area’s comparable sales. In contrast, the appraisal process for commercial property is more complex. It involves dividing your company’s net operating income by the capitalization rate for the region. Valuing your property correctly will make it much more attractive to potential buyers.
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2. Browse the Web
Browsing commercial property real estate websites is a phenomenally beneficial use of your time and effort. Think of these real estate listing sites as digital marketplaces. These sites usually have continuously updated databases of active investors and sellers. Depending on which firm you choose, services offered may include competitive pricing structures, integrated platforms, and real-time analytics.
3. Consult with an Analyst
Chartered Financial Analysts (CFA) are professionals in the finance industry. They are experts concerning a number of economic issues, especially when it comes to investment choices.
There are four types of analyst: portfolio managers, fund managers, ratings analysts, and risk analysts.
Typically, they examine your company’s financial statements. They will also assess the strength of your management teams. In addition, they evaluate your financial situation in light of their research into market trends and economic conditions.
4. Build a Marketing Packet
A professional marketing packet gives buyers valuable data that will affect their purchasing decision. Building a high quality and distinctive packet will help you stand out from other sellers of commercial property in your area.
To build a commercial marketing packet that will help interested buyers make an informed decision, include the following:
Use an aerial photo of your commercial property to make it look attractive. Include data such as the cap rate, your asking price, and the property address. To determine the cap rate, divide your net operating income into the property’s price.
Additionally, include aerial photos from Google Earth. This will show prospective buyers where your listing sits in your local area. For example, such a photo will show if your commercial property is near a highway, schools, other retailers, and so on.
Include a large map that shows where the property is located within your city. Add a second map that’s more detailed to show local roadways, intersections, and nearby buildings.
Adding high quality photographs of your interior will make you look more professional. Additionally, it shows buyers exactly what they’re investing in. Look for unique selling points that make your property different from other nearby commercial properties.
Commercial property buyers are primarily focused on income. Therefore, include a full pro forma document detailing your projected net income over a specific period. Include cash flow analysis, financial ratios, and any other financial projections that will educate your buyers on your property value.
Although the packet promotes the property (not you), feel free to include a small biographic section about you and/or your firm. This shows potential buyers who they are dealing with and makes you more personable.
Buyers and clients are more careful about their investments than ever before. That’s why you need to collect and organize as much documentation on your business as possible. These documents will serve as verification for the claims that you make about your property.
Finally, consider offering to finance the new owner for a portion of the deal. This could allow you to manage the property for up to two years while collecting a recurring paycheck.