Even through the national shutdown, sectors of the
commercial real estate market continue to hold their own. Commercial Realtors confirm
that office buildings, retail spaces, restaurants, warehouses, commercial
spaces, and factories will stay in high demand for both lease and sale, as the fundamentals
of the economy are strong. If you want to buy or lease commercial property for
your business, it’s wise to find a real estate agent who specializes in
different types of commercial properties. Commercial real estate brokers earn income
through commissions earned and paid by the firm representing the property owner,
so the cost of hiring a broker to help is often zero. These trained professionals can enhance the
result of your real estate search in the following ways.
They know the market inside-out
Every agent might represent a seller or buyer, although
there are a few noteworthy differences. A commercial agent is more likely to
have undergone widespread training and earned a financial or a related degree
in college. These individuals often have long-term industry experience. They
know a variety of negotiation strategies and business math concepts applicable to
This expertise enables commercial estate agents to answer
confusing questions about things like capitalization rates, payoff schedules, internal
rates of return and gross rent multipliers. If you’re interested in expanding
or purchasing a business or commercial investment, you would probably need
statistics that prove the viability of a real estate investment. Commercial agents
know how to accurately calculate every figure that will help you determine if a
certain property will truly meet your needs.
Let’s say you might ask a real estate agent for a hotel’s
cap rate. You could use these figures to estimate how long it will take for you
to make a profit on your investment. A commercial real estate specialist will determine
and divide the establishment’s annual net earnings by its overall value or
purchase price. If a $900,000 asset generates $85,000 after total expenses, it
has a capitalization rate of 9.44 percent.
They are Connected
Commercial agents mainly concentrate on networking with
people in the upscale business community. They know officials, local bankers as
well as individuals who own several buildings. Their connections facilitate
smooth transactions and expand buying options. For example, they can identify commercial
buildings and properties that haven’t been listed for sale or rent but remain
available for leasing or purchase. Agents might also assist you with zoning issues,
financing or regulatory compliance.
Access to More Listings
Anyone can find a residential property as they mostly appear
in multiple-listing service results where you could find details about homes. On
the other hand, Commercial and business-oriented buildings are scattered across
many separate databases. Agents need to subscribe to these services and pay fees
to view the information. If you are searching for a commercial building for sale,
then there is a possibility that the best ones are “invisible” from your sight.
A real estate agent could help you in finding the best commercial space for
sale through research and relationships.
It saves money
People usually think “who needs an agent; I could do it myself” – this is where they are wrong. Hiring an agent will not only get you the best commercial space; it will also get you the best deal possible. Let’s say you buy a commercial property of $800,000 on your own, but after assessing its market value and the cost of renovations, you realized that the property shouldn’t have been higher than $700,000. You realized your mistake, and it only cost you $100,000! A real estate agent may charge you a small fee for making sure that you will not make such an expensive mistake, or if they are included in the deal, it may cost you nothing.
Moreover, commercial real estate brokers have the
expertise to negotiate the best deal on every aspect of a real estate transaction.
It is also worth noting that other than the price per square foot, the cost of possession
entails numerous factors, such as operating expenses, improvement costs, the
quality of construction and building/space amenities, among others. A commercial
real estate broker will carefully consider these factors before finalizing your
sale or lease agreement.