Commercial real estate property purchases are getting more complicated as time goes by. These transactions can be tricky and they require a thorough analysis. In this case study, I’ll uncover some details about how I handled one such transaction.
Please note that Westwood Net Lease Advisors is always working as a Commercial Real Estate Buyer’s Agent, so our coverage is that from a buyer’s agent perspective.
Before We Start: Why Use A Buyer’s Agent?
Seasoned real estate investors will quickly jump at answering this question with “Why would you NOT use a Buyer’s agent?”
Moving from one commercial property onto another using a 1031 Exchange can be quite complicated. This is why experienced investors always get a buyer’s agent on board. That way, you the buyer, get a professional that you don’t pay for. This is because buyer’s agents are sharing the commission with the seller’s agent, who is paid by the seller.
Buyer’s agents will work on getting a shortlist of properties to choose from. They will do all the legwork around discovering all the property details needed during the negotiation process. And they will do the negotiation with the seller’s agent. Buyer’s agents do all the work for you, and, it’s all free of charge for you because as we already mentioned, buyer’s agents are in fact splitting the transaction fee with the seller’s agent.
This is why seasoned real estate investors answer this Why question with “Why would you NOT use a buyer’s agent?”. They know that all this 1031 Exchange is a lot of work that’s best handled by a professional.
Now that we have the obvious question addressed, let’s move on to explain how one real estate investor benefitted from Westwood in the Buyer’s Agent role.
The client contacted Westwood by filling in the free online application form available on our website. Soon afterward, I, Jason Simon, called back the client and arranged a meeting.
The client explained that he was interested in buying a Double Net Lease (NN) property.
Delivery of Property Options
I looked at various available properties until I found some attractive properties which met the client’s needs. I presented him a list of similar NN lease properties, but the client insisted on a specific space leased by a retail healthcare company.
The client was immediately intrigued by the NN structure of the property which covers landlord responsibilities of roof and structure maintenance as well as the lease term of over 10 years. The building and lot size were also interesting to the client and after discussing the details and any additional concerns, we started negotiating a deal.
Negotiation and Closing
I succeeded in the price negotiation. The deal was closed on $7,343,000 at a CAP rate of 7,2%.
The client was happy with the negotiated price and the property specifications and thanked the Westwood team for its professionality. The deal also included a clause for a solid annual lease increase.
How Do You Get Started?
Perhaps this case study helped you understand how our team can assist you if you are interested in buying your commercial real estate property. We can help you find an appealing deal, and guide you throughout the entire process (including initial contact, property details, specifications, and closure process).
Please do not hesitate to complete our online application form.
We are eager to help new clients and to advise you on commercial real estate transactions and current market opportunities.Tags: Buyer's Agent, cap rate, commercial real estate, commercial real estate investing, Commercial Real Estate Investment, commercial real estate transaction, commercial tenant, double net lease, Seller's Agent