Serious Sellers vs. Time Wasters
Before we can represent the seller officially, we, as brokers, have to make sure that we are on the same page and everything is in place. We, with the sellers, need to have our expectations aligned if this is going to be a successful representation.
If the seller’s expectations are too high for the property’s market area, or are unreasonable, it’s a red flag. Don’t even bother working with that seller, just walk away. You will save yourself a lot of time and frustration.
Let’s go into detail what we need from our sellers for a successful transaction and representation. If a seller is not going to cooperate with you, there is no point in moving forward. I mentioned how to differentiate yourself as an Off Market commercial broker for this niche market in my previous article. But now, we also look for certain features in sellers to determine whether he/she is the right seller to work with. This is a two way street and the seller also has to play his part to make it happen.
Ask your seller to provide you due diligence documents to present his property to a potential buyer. If for any reason the seller hesitates to provide them, then he is not a serious seller. Any serious seller should know that he has to provide this information. You, as a broker, can’t sell a multi million dollar property without a due diligence package. This is why it is so important to align expectations. If the seller is serious, then expect these documents:
Seller To Provide:
- A narrative relating to the property
- YTD actual financials (If property in operation)
- At least last year’s actual financials, if applicable
- Projected P&L of the fiscal year
- Detailed Rent Rolls, if applicable (Not applicable to hotels or vacant properties)
- At least a 5 year financial pro-forma (If past financials are not available)
- Site plan, building layout, plus building specifications (Whatever available)
- Parcel map of the property, if applicable & location/address
- Copy of the basic lease agreement utilized with tenants (This is an unfilled version, not each tenant’s lease agreement)
- Occupancy numbers for non-hotel property types
- STR Report for hotels
- Asking price of the property
It is OK if the seller does not have all of these documents right away. As a broker, you just need to know that he/she is willing to provide them. You don’t want to spend a lot of time on a deal that goes no where, especially if it is an Off Market deal. It is the nature of an Off Market deal to work with a small and select group of buyers. Without an adequate information package, you are shooting yourself in the foot by presenting an unfinished product. This is bad for your own reputation, of course, if you want those buyers to work with you in the future.
We focus and specialize in Off Market commercial real estate in Chicago and nationwide. We are experts in filling the void of multi-national and local real estate brokerage companies for Off Market commercial real estate. If you would like to sell your property without listing it, discover how Creative Commercial Brokers can help you reach your real estate goals in Chicagoland and nationwide.
As commercial real estate brokers in Chicago, we have built solid relationships with many qualified buyers looking for well performing assets nationwide.
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