Commercial Real Estate News / Property Management / The Ins and Outs of Preparing Commercial Property for Sale by Owner

The Ins and Outs of Preparing Commercial Property for Sale by Owner

Published: 02-17-22 Category: Property Management

Specializes in providing actionable insights into the commercial real estate space for investors, brokers, lessors, and lessees. He covers quarterly market data reports, investment strategies, how-to guides, and top-down perspectives on market movements.

Even if you decide to use an agent, getting a property ready for the market is a pretty big undertaking. It becomes even bigger if you decide to pursue an opportunity to have a commercial property for sale by owner. FSBO typically is used with residential real estate, but it’s just a mechanism that isn’t limited to only one type of real estate.

We prefer to always be completely honest and upfront about the state of commercial real estate, and so we will say that going the FSBO route isn’t for the faint at heart.

Instead of walking you through the obvious how-to steps, we wanted to cover some of the overlooked stuff that comes into play when you’re preparing a commercial property for sale on your own terms.

Start With Marketing in Mind

We’ve all seen listings that aren’t as well marketed as they could be. The photographs are out of focus, the description really isn’t targeted, and the contact information is out of date or not the best number to reach the seller. But good commercial property marketing is more than just photos and a few words on a listing. Here are a few considerations to keep in mind:

Think about the exact type of buyer you want. It seems a little odd to be specific, but visualizing the buyer makes it easier to market the property in the future.
Make it easy for them to contact you.
Don’t skip over the video. It’s so easy to upload good video, even smartphone video, that ignoring video seems silly.
Let the entire community know what you have to offer, even before the listing. Sometimes it’s much easier to get a buyer when the community knows you have something to offer. Don’t waste your network.

Good marketing is a system, not just a one-time event. After all, it’s highly unlikely that you’ll only settle for one property sale in your entire time within the CRE world. So the more that you build up your network and look for opportunities, the easier it will be to sell properties over time.

Prepping the Actual Property

Some of the best listings on the market shine not just because of the right price, but the right presentation. It’s always a good idea to imagine walking through the property as a buyer, not just as someone that’s held the property for a certain amount of time. Here are a few more particulars to keep in mind for preparing most commercial properties.

Tackle That To-Do List

Outstanding repair concerns create issues when it’s time to list the property, get people in to check it out, and get those same people to consider making an offer on the property. Property management can take up time as it is, but trying to handle everything at once is just a recipe for disaster.

Ask yourself the following questions:

What are the most urgent repair concerns, and how long will they really take?
Are there any quick repairs that would improve the overall look of the property?
What does the current landscaping do for the property? Are the entrances and exits properly maintained?

The little things mean a lot to buyers, and taking the time to handle the small details makes buyers feel more assured that the bigger details are handled. All of these tips are designed to address buyer comfort from the very beginning so that the chances of selling the property increase.

Get the Records Ready

Inspection reports are truly worth their weight in gold, and providing them makes sellers feel at ease. Another set of documents that are definitely always in season would have to be the full maintenance records on the property.

You don’t have to have every single receipt for every nail or screw that you purchased while tending to the property, but having details on major maintenance work is pretty important for a commercial property.

Showing the survey of the property will also make a difference. This is especially true for a property that includes quite a bit of land. Buyers want to know where the boundaries are as well as where any easements are for future reference.

Sure, some of this information is also readily available for their own due diligence, but FSBO is already difficult. Making the path smoother for buyers to get interested never hurts.

Presenting the financial fundamentals of the property is also a great way to pull in more buyers. The commercial property world is focused on income generation, so having those numbers for quick reference turns an average property into a much more interesting prospect in the eyes of buyers.

Make Showings Spectacular

Since location is essential within the CRE world, chances are good that the most interested buyers are going to want to see the property for themselves. Whether they make a visit or send their representatives, it’s always a good idea to plan for showings.

Walk through all common walkways around the property and ensure that everything is accessible. At this point, all of the lights should work, the water should remain hot right from the tap, and all permanent fixtures look great. While these points sound like common sense, the reality is that many sellers rush through getting the property ready, assuming that they have time after the showing to really dial in the work.

Be Extra Diligent Should You Decide to Go FSBO

When you add up all of the tasks required to showcase a property for sale, it becomes obvious why so many turn these tasks over to their agent or broker. The truth is that the FSBO method isn’t for everyone, and it’s perfectly okay to prefer letting the agent handle this stuff.

However, if you have a specific plan in mind to market the property, show it to buyers, and work out all of the negotiation necessary for a good deal, it can be rewarding.

Sometimes the FSBO route is just a way to confirm that we can handle certain tasks without bringing in the professionals. Whether you pursue FSBO or not, it never hurts to learn new strategies to make the most out of it.

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