While there are so many benefits to investing in commercial real estate, making just one wrong call when you’re selling can instantly undo all the years of progress and work you put into the property. It’s important that you understand the risks in order the reap the rewards. Getting informed is definitely the right first step to take before you prepare to sell. Here are five of the most common mistakes made when selling commercial real estate and how you can avoid them.
1. Doing It Alone
Going for a private sale can be a tempting idea thanks to the allure of all the profits you’ll get when your buyer settles, and that feeling of control. The issue you’re overlooking, however, is that it’s never as simple as it seems and the sale is unlikely to be fast or easy; especially if you’re inexperienced. Hiring a commercial real estate agent is always worthwhile because their goal is to maximise your return on investment. Only a professional has the advanced market insights and experience needed to get reliable results and leave you, the owner, with minimal stresses.
2. Selling At The Wrong Time
Never sell a property based on a feeling if you’re not heavily informed on commercial real estate trends and the market for your area. Time and time again, property owners decide to sell because they need the money or are simply tired of managing the property. So they sell on a whim as fast as they can, only to find out a few months later the price was extremely undervalued or in the middle of a serious bear market. Unless you are in an emergency situation, do not rush a sale. Get informed first, or hire someone who is.
3. Minimal Advertising
It’s important that your commercial property is advertised on all the appropriate channels to target your desired market and attract the right buyer. Inexperienced sellers will either start this process on the right foot but fail in narrowing down and properly screening their prospective buyers, while others have no clue how or where to place their classifieds in the first place.
By not advertising enough, or not in the right places, you are doing yourself a huge disservice. You risk the process lasting even longer, and if you’re not targeting the right demographic, potentially selling at a loss.
4. Weak Negotiating
Effective negotiation is a technique that comes with practice. It is not an easy process. A lot of the time, those who take the DIY approach in selling their first property will get into it with confidence, only to realise in the final stages that they are not strong negotiators. Rather than calling a real estate professional who knows what they’re doing at the last minute, they’ll stick it out with their weak negotiation skills in a bid to save face. In reality, all this does is save your buyer money, at your expense.
5. Not Putting In An Effort With Inspections
While this may seem trivial, that couldn’t be further from the truth. A lot of time and effort goes into setting up a commercial property for inspections. Then there’s all the work that goes into organising the date and times, communications, and the event itself. This is oftentimes underestimated by those with demanding work schedules or big families to take care of and the quality and frequency of inspections suffer as a result.
The easiest way to avoid all of the above is to do your reading and hire a reliable commercial real estate agent to help you get the most out of your sale.