Books About How to Sell Commercial Real Estate

The last four months I have been taking courses in accounting, marketing, finance, and management theory. All apply directly to what I can apply when selling commercial-investment real estate. However, finding a good book written by a practitioner about my line of work is rare to come by. I will share with you a rare gem of a book I found in my broker's office that satiates a long insatiable appetite, if you will write me a short note about your own search for such literature.

Motivation

What motivates a commercial broker? 1) They need loyalty and a promise that his or her time is going to be compensated for. 2) A driver which usually resides within a good broker and is closely tied to needs and incentives. 3) You will get more good work out of a broker if you are willing to offer an equal incentive for the amount of work that needs to be put into the task.

If you are a buyer or seller, in order to facilitate a successful exchange you will also have to be motivated. Ask yourself this question, "am I motivated, do I have a need, the drive and an incentive?" If the market value of your property is not motivating, are there other alternatives that would motivate you? If not then it may be a good reason not to sell until your motivation level increases.

Focus for 2010

It's now 2010 and I've developed a new marketing system which can be tailored to each individual property. I'm trying it on the properties I already have listed and am optomistic that the results will exceed expectations.

Advertising in the classifieds is very expensive and does not generate the right kinds of calls for a property. Defining the needs a particular property fills to derive a target market provides a good basis for developing a marketing system.

I've decided that I will continue to work with buyers in 2010, but must focus more attention on providing sophisticated marketing services for sellers in order to attract more listings. One reason is because all too often buyers don't pay, and I don't know many professionals who provide complicated services requiring high levels of skill without being hired do so. So in essence getting hired through listings will be my mainstay for 2010. I will focus on making sure that I will be paid for my services.

I appreciate any feedback from readers.

Tax Appeal Results

I appealed the taxes on properties that I manage as well as properties that I have an ownership interest in. The most successful appeal reduced the annual tax bill to the owners by over $30,000.

In this case the property is a vacant undeveloped land and the city requires the owner to dedicate 40 feet of ground to the city for a new proposed parkway. It was just a matter of stating the facts so the assessor can value the property accordingly.

The appeal for my residence was not quite so successful however. It was the most likely and perhaps the best supported appeal, but no reduction was granted. Denied.

All in all we faired well and I have since noticed a number of properties where the taxes were not appealed and wished I had been aware of them before to offer some assistance.

Median House Price in GJ

Out of curiosity I took a look at all stick built houses that sold in the City of Grand Junction from February 1st through July 13th this year and figured the median price per square foot, and it is....$131/sf. So if your house is 1,750 square feet then a median price for this type of house would be $229,250.

In the past three months the highest priced house per square foot sold for $175/sf, and it was under 1,500 sf.

Commercial Real Estate Stats 06/2009

According to the local Multiple Listing Service (MLS) the following statistics indicate the number of commercial properties sold in June this year as compaired to June last year decreased 45%, the price per square foot decreased 14% and the price per acre for land decreased 9%.

June 2009

• 5 improved properties sold. 3 retail/office 2 industrial
• Median price: $140 per sq. ft.

• 1 unimproved (land) property sold
• $294,030 per acre

June 2008

• 9 improved properties sold. 6 retail/office 3 industrial
• Median price: $163 per sq. ft.

• 2 inimproved properties sold
• Median price: $323,774

I'll continue to work on perfecting the analysis to make this monthly update as accurate as possible. If there is other data you would like to see reported please leave a comment and I'll send you a gift certificate (if you leave me a way to contact you).

Note: Mesa County has only updated their property sales through mid-April, if I can figure out a way to fill-in the data missing that is sold and leased outside of the MLS system, I'll include that in my monthly update.

Consumer Price Index (CPI)

Have you ever been eating at home or a friends house when the cook exclaims, "guess the secret ingredient?"  I heard a story about a Mormon missionary serving in France who thought it would be funny to add a special ingredient in his scrambled eggs for new missionaries.  One disliked the fact that the secret ingredient was cow brains enough to permanently dissuade him from continuing the joke.

A clause in your lease that includes an escalation based upon the CPI index, is a bit like that secret ingredient if you don't know it's there.

I recommend reading the article called How to Use the Consumer Price Index for Escalation published by the Bureau of Labor and Statistics (BLS).  You'll then be as smart or more than likely smarter than the Landlord on how it's used while avoiding costly oversights or miscalculations.