What is to be expected when using a commercial real estate broker?
For starters , there are a few types of commercial real estate brokers as defined as to what they do or specialize in and whether they are with a big firm or a regional or boutique firm or they work for themselves. Let’s start with the specific primary types of commercial real estate brokers and the types of properties commercial brokers may represent from a landlord or seller.
- Special Purpose
- Office buildings, office condos, office properties
- Industrial: Flex space, office warehouse space, bulk warehouse
- Retail property
Commercial Real Estate Agents
A commercial real estate agent is different from a commercial real estate broker sometimes called “CRE brokers” Agents will work for brokerage firms and will not work off on their own within their own company, these professionals are sponsored and work under a firm.
Does the Shotgun approach work?
A shotgun approach is used by a company or individual who chooses to call multiple commercial real estate brokers at once. Typically, the way the conversation goes is there is an expectation that the commercial real estate solution will come from several CRE brokers versus one. There are some inherent issues with this approach, the first being any professional commercial real estate agent or broker who is good at what they do will not compete against 4 others at the same time. An exclusive agreement is the standard for the professional who gets results, it should provide you as the consumer an out if you are not happy with the results, as well as an cancellation clause for the broker representing you, so you are not stuck.
Issue #2: Let’s say 4 commercial real estate agents send you 10 properties with no agreements in place they represent you exclusively. What happens? You get 10 commercial real estate solutions from each broker and 8-9 of them are the same property, the dilemma is – who gets to follow thru with you on the property? So inherently there is no protection whatsoever for the commercial real estate professional who pays for tools and commits their time and effort to send you properties to view. You should not have to pay any fees and if there is an issue with the landlord or seller not paying a commission , it should be communicated to the client pro-actively. Keep in mind, a commercial property lease or purchase is not just a search, it is much more than that. The typical lease or purchase takes a minimum of 15 steps to get completed. Finding a property is only the first step.