The Broker for Commercial Real Estate: Myths and Reality
Posted by admin | Real Estate | Posted on September 14th, 2009
The professional brokerage services in the commercial real estate in canada have become relatively recently. Therefore, so far most people to question «What is the broker for commercial real estate?» Simply pozhmut shoulders. and even those who have already sdaval or rented premises with the help of agencies often do not have a clear understanding of the benefits of treatment with professionals do not know what can and should demand it. In this paper, we would like to razvenchat most common myths associated with the broker for commercial real estate.
Myth number 1: The more impressions, the better Commercial real estate broker?
There is widespread view that the broker must regularly show customers as many options for accommodation, and the more he does, the better the quality of his work. In fact, everything is accurate to the contrary. A specialist in Brokerage says that to find a place that meets all the requirements of the customer, it is very difficult. It is therefore too frequent views are likely to indicate that the broker inattentively listening to the customer and invites him options «random». Because such a broker-«guide» losers as the owner of land or a potential buyer, because they spend their valuable time without any result.
This pros listened carefully to your wishes, will explore all available on the market offers and choose the one that is the one that really suits you. Typically, to achieve the result it needed a maximum of 3-4 run.
Myth number 2: Professionals working in large agencies
Most people believe that the name loud and «scale» Commercial real estate agent are the guarantee of experience and professionalism of brokers. However, it is not always the case. First, imenitye company with a long history and so have no shortage of willing them to work, therefore, offer brokers a fairly low percentage of commission agency. At the same time, smaller companies, by contrast, are interested in attracting qualified staff and are ready to provide them with more favorable financial conditions. Secondly, the major agencies are working with their brokers (exclusive) targeted the company. That is, they do not need to perform the full range of work (searching the premises, negotiate with the owner, the conclusion of a treaty, etc.), their challenge – to find a buyer or lessee for the finished space. In the same small companies where its facilities are not a lot of brokers make the deal «zero». Accordingly, they are inherently requires a deeper market knowledge and understanding of customer needs.
Myth number 3: The private broker deal advantageous
How many people would not burn at the service of so-called «private brokers», still find someone who advise you to refer to what someone Ivan Ivanychu because it has a «cheap». Save you the truth, not at the cost of services as well as their own and tranquility, but one that you certainly will not be prevented. So for what is, in fact, «overpay» client, referring to the agency?
First, any self-respecting agency has a code of ethics, which clearly stated rules of conduct broker with a client. For example, according to the code, the broker has no right to give you incorrect information, he is obliged to protect your interests and provide you with all information on the transactions. Violation of these rules officer could lead to a very unpleasant consequences for him, up to and including dismissal.
Secondly, the agency all brokers are under the direct control of management. That is, if the broker makes a wrong step, it is always correct, will help the Council and, if necessary, transfer the customer to another specialist.
In the third, all the documents through the agency, must be checked by legal department, which simply did not miss a treaty, if it in any way harm the interests of the client.
At the same time, the private broker – his own boss. He chooses what information and voice as silence, which contract clauses to draw your attention, and what – to turn a blind eye. If later you have a claim to the quality of his work to bring him to justice will be very difficult, especially since most of these «mediators» never registered.
In other words, use the services of private brokers – the same as changing currency outside exchanger: the best rate, but no guarantees.
Myth number 4: Better to apply directly to several agencies
It would seem that logic is simple: the more agencies involved in the sale of your object, the faster will be the result. But it can talk only to people uncomfortable with the technology of the brokerage firms. There are quite a narrow range of print and online editions, in which the agency placed on their sites. Accordingly, if you go in, say, five agencies, the risk to see five different ads on your site in the same media. Not only that, this in itself gives questionable advertising, so more likely is that each agency will try a little «glossed» characteristics of the object, and as a result of the five ads will give contradictory information.
In fact, just one mention in a single edition, and the subject invariably enters the Realtor database. Most brokers use the same database, so eventually have the same information. In other words, referring to one agency, you are not at all does not diminish their chances of quickly and sell objects, and the main thing – you save it (the facility) reputation.
Another negative working with several agencies – not with one of nih.vy can not conclude an exclusive contract. But only an exclusive contract with the company, the broker will give you the most advantageous plan for moving your site and the best conditions of the transaction.
Myth number 5: Just look at base facilities – and is ready to deal
«Agencies huge database, so the broker is not working on specific criteria quickly find a suitable place …» Unfortunately, such statements have to hear quite often. But if everything was so simple, the deal would be for one day, but brokers do not have to go out of office. There is a logical question: why is this not happening?
Ironically, this sounds trite, but each case is individual, and in addition to the basic requirements for space, a lot of suggestions, «popup» already in the works. Someone is, you need a certain thickness of the walls and ceiling height, someone – large display cases without denying their trees, someone – the possibility of redevelopment … Yes, and the owner often has its own vision of the potential lessee: some are unwilling to «sit» state structures, others do not want the office was a large flow of visitors, still categorically against auditing firms … from the broker requires maximum patience and perseverance to find a solution that satisfies both sides. Is not enough just to work with the foundation: you have to go to watch, personally meet with the owners, always check the validity of the information, etc. That is why the «secondary» transaction usually takes two weeks to two months.
Myth number 6: Target broker – only to find a buyer
Many believe that when a potential buyer nods his head approvingly and said that it is suitable premises, the broker ends. However, in reality, at the end only the first stage – search – and begins the most difficult – to bring a deal before signing the contract. It would seem that this special? Did the seller and the buyer (owner and tenant) are not able to agree? But the reality is that of a very positive mood on both sides in 70% of cases prior to signing the deal just does not come!
Most disagreements arise when it comes to the payment schedule. Many sellers prefer not officially identify the real value of the site and receive a portion of cash through offshore companies or foreign banks. At the same time, not all buyers (especially integrity in such matters are foreign companies) are ready to go.
Another reason why the parties can not reach a common denominator – the desire of the owner of the premises set in the contract of any special conditions. For example, the landlord can set high fines for smoking in the office, taking over the territory of a business center pets … If at first glance, such claims can not raise specific complaints, it being documented, they are often greeted with a fundamental rejection of the tenant.
Thus, there is little to find a buyer. Craftsmanship broker is the ability to circumvent the acute angles, find the necessary compromises to bring the deal before signing the contract and help his client to conclude it in the most favorable terms.
Myth number 7: Broker gets huge money «for nothing?
And finally: Many believe that life is a broker – a paradise in which money is literally falling from the sky. In fact, it is not. This is hard work, and the result is until the last moment not in a position to predict one. The broker can work for months over the same transaction, and on the day of signing a treaty She sorvetsya. Or show room once, and it would thus «ideal» option. The customer can articulate demands, and perhaps did not know what the wants and reject good offers, one after another. This stress job that requires high concentration and absolute dedication. And again: we should not forget that the broker receives a commission only for results, so his income is directly proportional to the effort.
Information provided by «United Realty Group» (consulting, brokerage services, leases, buying and selling commercial real estate, legal support transactions). http://www.pro-bargainhunter.com