970.241.2909 - Bray Commercial Real Estate

Transcription

June 2007
Delta
Clifton
FUL
LY
LEA
SED
25 Stafford Lane
3227 I-70 Business Loop
Brad McCloud • 250-7988
Ed Slater • 250-0551
BROKERAGE • SALES • CONSULTING • MARKETING
LEASING • DEVELOPMENT • MANAGEMENT
970.241.2909
244 North 7th Street • Grand Junction, CO
braycommercial@brayandco.com
www.braycommercial.com
Cover photo courtesy of Jim Bennett
Bray Commercial Real Estate
contents
Commercial Properties
Contents / Broker Associates................. 2-C
Office Space for Sale or Lease.............. 3-C
Retail Space for Sale or Lease............... 4-C
Office, Warehouse & Industrial............ 5-C
Business & Investment.......................... 6-C
Land & Development Properties........... 7-C
Property Sector Cycles. ................... 8-C
Preparing Commercial Property. . 9-C
Bray Commerical Real Estate
has an extensive portfolio of retail shopping
centers, office buildings, warehouse and
industrial properties, vacant land, development
sites and apartment complexes.
Our team of professionals offer the highest
standards of excellence and we’re ready to help
your business dreams become reality.
Residential Properties
Featured Properties................................2-R
Contents / Bray Locations......................3-R
Broker Associates..........................4-R
Homes $500,000 and over....................6-R
Homes $300,000 to $499,999........... 10-R
Homes $200,000 to $299,999........... 13-R
Homes $199,999 and under.............. 17-R
Lots, Building Sites & Acreage............ 18-R
Grand Valley Area Map.................. 19-R
(970) 241-2909 • 1-800-695-0539
244 North 7th Street • Grand Junction, CO 81501
our team of knowledgeable & dedicated
commercial professionals
*Agents listed by Bray Commercial tenure.
Schaefer
Bray
Chairman
of the Board
Squirrell
CCIM
Office: 241-2909
Office: 241-2909
gregschaefer@brayandco.com
Cell: 260-0121
sid@brayandco.com
Dick
Les
Sam
Kelsey
Cell: 260-2007
Cell: 261-8056
Cell: 201-9444
Office: 241-2909
Katie
Ed
Jere
Brad
Direct: 263-2944
Cell: 250-0551
Cell: 778-1567
Cell: 250-7988
Thompson
dthompson@brayandco.com
Worrall
kworrall@brayandco.com
-C
Sid
Greg
W.R.
Smith
lcs@brayandco.com
Slater
edslater@brayandco.com
Suplizio
sam@brayandco.com
Woldruff
jerew@brayandco.com
Sharpe
ksharpe@brayandco.com
McCloud
brad@brayandco.com
office space
for sale or lease
City
2352 North 7th Street #B4
•1,400 SF Office Space
•Amidst the Medical Community
City
105 West Main Street
•2,177 sf - 1st Street Location
•Across from Two Rivers Center
City
123 North 7th Street
•1,049 sf Garden Level
•Merrill Lynch Building / Downtown
$1,200/mo Gross
$10/sf/yr Gross + Utilities
$10/sf/yr Gross
Jere Woldruff
778-1567
Greg Schaefer • 241-2909
Kelsey Sharpe • 241-2909
Sid Squirrell • 263-2947
City
321 Rood Avenue
City
1165 Bookcliff Avenue
City
359 Main Street
City
2808 North Avenue
•6,452 SF - 2nd Floor
•Could Be Divided - Many Options
•2,772 SF - Free Standing Office
•Good Visibility and Off Street Parking
•1,006 sf Office - Wells Fargo Bank
•Downtown Main Street
•7,652 sf Ground Level - Natural Light
•Elevator Access - Off Street Parking
$10/sf/yr Gross
$10/sf/yr NNN
$11/sf/yr Full Service
$12/sf/yr Gross
Jere Woldruff
778-1567
Jere Woldruff
778-1567
City
2232 North 7th Street #7
City
2470 Patterson #5
North
2779 Crossroads Boulevard
City
•Medical Community Area
• 701 SF Office Space
•1,963 SF Professional Office
•Expanding Patterson Rd. Bus. Dist.
•2,500 sf Shared Building
•Northern Business District
•3,739 SF Professional Medical Office
•Previously built-out and ready to go
$13/sf/yr NNN
$15/sf/yr NNN
$15/sf/yr Gross
$15/sf/yr NNN
City
North
2560 F Road
City
200 Grand Avenue
City
700 Belford Avenue
•371 SF Alpine Bank Office Suite
•2,387 SF Restaurant Space
•3,000 sf Newly Constructed
•Busy F Road Corridor
•1,691 SF 2nd Floor Bank Building Office
•Excellent Exposure & Access
•1,000 SF Premier office space available
•Located in the NEW Fidelity Building
$16-$18/sf
$18/sf/yr NNN
$18/sf Gross
$15.50/sf/yr NNN Negotiable
Sid Squirrell
263-2947
Sid Squirrell
263-2947
Sam Suplizio
201-9444
-C
Bray Commercial
Real Estate
retail space
transactions
for sale or lease
• May •
Leased Properties
3227 I-70 Bus. Loop, Peachtree S.C.
.............................. 25,000 SF Retail
356 Main
........................1,832 SF D.T. Retail
Sold Properties
2162 Highway 6&50
.................... 3.82 Acres Zoned I-1
New Commercial Listings For Lease:
565 25 Road, #103
........2,082 SF Office/Warehouse
569 32 Road, #13A & 16B
..................1,100 & 1,272 SF Retail
321 Rood Avenue
...................6,452 SF Office/Retail
...............................2,772 SF Office
3210 I-70 Bus Loop, Mesa Pointe
.....................................Retail Units
New Commercial Listings For Sale:
3228 F Road
...................4.27 Acres Zoned C-2
TBD Blichmann Avenue
.................... 1.72 Acres Zoned I-0
595 North Westgate
..........2,082 SF Office/Ware/Yard
Air Tech Court
........................... 3 Lots, Zoned I-0
Sale Pending:
1101 Kimball Avenue
6.55 Acres
........................................ Zoned I-2
3497 E Road
..........37,500 SF Multi-Use w/Res
119 West 3rd, Palisade
................................ 3,703 SF Retail
........4,686 SF Stand Alone Retail
229 East Aspen, Fruita
........................2,525 SF Bus. Opp.
2765 D Road
......................... 5 Acres Zoned I-1
1002 Pitkin Avenue
......... 696 SF, .14 Acre Zoned C-1
650 West Gunnison Avenue
492 30 Road
...................5.88 Acres Zoned B-1
569 S. Westgate #4
........2,088 SF Office/Warehouse
TBD South Westgate
.......................... Commercial Lots
1104 Pitkin Avenue
.............................. 11,219 SF Retail
North
817 Falcon Way
•5,721 sf Unique Building near Airport
•Zoned Special Use (PUD)
•1,428 SF Free Standing Building
•Six Offices, Work Area & Kitchen
$7,455/mo Base + TX
$249,900
Jere Woldruff
778-1567
Clifton
Fruita
455 Kokopelli Boulevard #C
•Office/Retail/Warehouse Units
•1,200-5,200 SF Units Available
•1,666 SF Retail or Office
•New Building - Great Location
Clifton
3225 I-70 Business Loop #8,9 & 10
•(1) 1,150 & (2) 1,443 SF Retail Units
•Peach Tree Shopping Center
$8 to $12/sf/yr NNN
$1,200/mo NNN
$9/SF NNN
Sam Suplizio • 201-9444
Katie Worrall • 263-2944
Sam Suplizio
201-9444
Jere Woldruff
778-1567
Clifton
569 32 Road #13A & 16B
North
2584 Patterson #C
City
620 Main Street
•1,100 & 1,272 SF Retail Space
•Coronado Plaza with City Market Anchor
•Excellent Office/Retail/Medical Space
•3,000 SF Vanilla Shell Condition
•1,700 SF Retail Space In Breezeway
• Just off of Downtown Main Street
$11-$13/sf/yr NNN
$13/sf/yr NNN
$12/sf/yr NNN
Sam Suplizio
201-9444
City
2465 Highway 6&50
Delta
25 Stafford Lane
City
573 West Crete Circle
•8,496 SF Retail/Office/Shop/Yard
•High Traffic & Visibility
-C
City
436 Independent Avenue
•1,500 – 1,800 SF NEW Retail Units
•NEW Retail Center anchored by Walmart
•20,360 SF New Construction
•New Generation, Multiple Units
$12/sf/yr Gross
$14/sf/yr NNN
$12/sf/yr NNN
Brad McCloud
250-7988
North
683 Horizon Drive #102
•1,200 sf Retail - Safeway Anchor
•Horizon Drive Business Corridor
Clifton
•New Retail Units – High Visibility
• 5,000 SF divisible to 1,250 SF
Palisade
392 West 3rd Street
•1,523 SF Retail Shop with Overhead Door
•Two Lots - Plenty of Parking
City
595 North Westgate Drive
•5,292 SF - .57 Acres – Zoned C-2
•Two Bldgs. – Graveled & fenced yard
$19.50/sf/yr NNN
$20 - $22/SF NNN
For Sale • $175,000
For Sale • $670,000
Katie Worrall
263-2944
Katie Worrall • 263-2944
Sid Squirrell
260-0121
office, warehouse
& industrial
for sale or lease
City
356 Main Street
•1,832 SF Downtown Retail
•Excellent Downtown Investment
City
527 Bogart Lane
•6,698 SF Condominium Across From Sam’s
•Prime Retail Location - Hwy 6&50 Frontage
City
2516 Broadway
• 3,176 SF Restaurant Bldg - Lease or Sale
• Formally Wendy’s - .65 Acres
For Sale • $429,000
For Sale • $850,000
For Sale • $895,000
Kelsey Sharpe
241-2909
Sid Squirrell
260-0121
City
592 North Commercial Drive
City
565 25 Road
Orchard Mesa
2770 Highway 50
•2,400 SF with Fenced Yard
•2 14’ Overhead Doors - Great Location
•2,082 SF Office/Warehouse
•Mall Area Access - 14’ OH Door
•1,200 SF Units Under Construction
•Adjacent to City Market
North
702 & 708 23 1/10 Road
•2,800-3,243 SF Personal Warehouses
•Store BIG toys or business overflow
$10/sf/yr NNN
$11/sf Gross + Utilities
$18.50/sf/yr NNN
For Sale • $210,000 - $305,655
Katie Worrall
263-2944
City
549 South 10th Street
North
687 Horizon Drive
City
562 West Crete Circle
West
1360 Highway 6&50
•Small Yard - Block Construction
•Pre-Leasing 1,200-3,600 SF Units
•Adjacent to Safeway on Horizon Drive
•18’ Eave Height w/large OH Doors
•2,400 SF Office/Shop - 7.25 AC.
•Highway 6&50 Front - Easy I-70 Access
For Sale • $599,000
$23/sf/yr NNN
For Sale • $674,900
For Sale • $1,105,000
Sam Suplizio
201-9444
Katie Worrall
263-2944
Dick Thompson • 260-2007
-C
commercial
warehouse
glossary office,
& industrial
Build-out
Refers to the interior construction of a tenant’s space
whether new construction or the reconfiguration of
existing space.
Certificate of occupancy
for sale or lease
Presented by city building department to landlord
or tenant completion of tenant improvements and
satisfactory inspections by city building department
inspectors
Northwest
2154 Highway 6&50
Commission
The fee paid to a real estate broker as procuring
cause and/or for his or her services rendered in a real
estate transaction. May be paid by either party in a
transaction; it is usually governed by a prior written
agreement.
•18,600 sf Office/Shop/Yard
•3.68 Acres Zoned I-1
Common Area Maintenance (CAM)
This is the amount of additional rent charged to the
tenant, in addition to the base rent, to maintain the
common areas of the property shared by the tenants
and from which all tenants benefit. Examples include:
snow removal, outdoor lighting, parking lot sweeping,
insurance, property taxes, etc. Most often, this does
not include any capital improvements that are made to
the property.
Covenants
Wording found in deeds that limits/restricts the use to
which a property may be put demising wall: The wall
which separates a tenant’s suite from another tenant’s
suite, or building common areas. In most cases, a
demising wall will be constructed from floor to either
the building roof deck or floor deck. The wall may also
be a fire rated wall (see “partition wall”).
City
•18,611 SF Office, Coolers & Freezer Space
•6+ Acres Zoned I-1, Fenced & Paved Yard
For Sale • $1,900,000
For Sale • $2,400,000
Les Smith
261-8056
Mack
1024 M 8/10 Road
City
609 Main Street
business &
investment
opportunities
Exclusive Agency
An agreement in which one broker has exclusive rights
to represent the owner or tenant. If another broker is
used, both the original and actual broker are entitled to
leasing commissions.
•Liquor Store – Country Jam Close
•Bus. & R.E. – 9 Miles to Next Services
Joint Tenancy
Ownership of real property by two or more individuals,
each of whom has an undivided interest with the right
of survivorship.
Lessee
An individual (i.e., tenant) to whom property is rented
under a lease.
Lessor
•Neighborhood Bar
•Business & Equipment Package
For Sale • $229,000
For Sale • $350,000
Mary Ann Severin • 250-9917
Dick Severin • 250-0697
Orchard Mesa
2769 B 1/2 Road
Rifle
142 East 4th Street
An individual (i.e. landlord) who rents property to a
tenant via a lease.
Letter of Intent
An informal, usually non-binding, agreement among
parties indicating their serious desire to move forward
with negotiations.
Listing
An employment contract between principal and agent
that authorizes the agent (such as a broker) to perform
services for the principal and his property.
Market Value
The expected price that a property should bring if
exposed for lease in the open market for a reasonable
period of time
Personal Property
Any property which is not real property. Examples
include furniture, clothing, and artwork.
Real Property
Land and any capital improvements (e.g., buildings)
erected on the property
Tenant Improvements
Work done on the interior of a space, can be paid for
by landlord, tenant, or some combination of both,
depending on the terms of the lease.
Collbran
103 Spring Street
•Motel Business Opportunity
•Grand Mesa Hunting & Fishing Area
• 3,196 SF Lube Center Bus. Opp.
• Pride Of Ownership Shows In All
• Neighborhood Cleaners & Laundromat
• 2,550 SF on .21 Acres
For Sale • $600,000
For Sale • $840,000
For Sale • $899,000
Jere Woldruff
778-1567
Les Smith
261-8056
City
2839 North Avenue
Craig
615 Riford Road
Collbran
Vega Lake Lodge
Trade fixtures
Certain fixtures installed at the premises which are
unique to tenant’s business, and which may generally
be removed by tenant at the end of the term of the
lease
Variance
Government authorization to use or develop a
property in a manner which is not permitted by the
applicable zoning regulations.
Zone
An area, delineated by a governmental authority, which
is authorized for and limited to specific uses.
•9,076 sf Restaurant (Leased)
•Excellent Investor Opportunity
-C
•Excellent Investment Opportunity
•48 Unit Apt. Complex - 97% Occupancy
•Cabins, Restaurant, RV Park & Retail
•34 +/- Acres on the Grand Mesa
For Sale • $1,700,000
For Sale • $1,975,000
For Sale • $2,000,000
Kelsey Sharpe •241-2909
Katie Worrall
263-2944
Jere Woldruff
778-1567
land &
development
properties
Northeast
2957 & 2959 North Avenue
•1 Acre Development Parcel
•North Avenue Location
Clifton
3201 F Road - Pad Sites
•Pad Buildable to 10,000 SF
•1.04 Acres, Easy Access, Zoned B-1
City
2938 North Avenue
•.27 Acre Pad Site
•North Avenue Frontage
City
735 White Avenue
•Downtown Bldg. Site for 7,800 SF
•4 lots - Zoned C-2
For Sale • $344,900
For Sale • $349,000
For Sale • $250,000
Les Smith
261-8056
Sam Suplizio
201-9444
Sid Squirrell
260-0121
Orchard Mesa
2770 Highway 50
Fruita
675 23 Road
City
TBD Blichmann Avenue
•Three 1 Acre Pad Sites
•City Market Close - Zoned C-1
•1.9 - 3.9 AC - Zoned C-2
•1.72 Acres Zoned I-O
•3 Commercial Lots - Some Highway Frontage •Foresight Business Park
For Sale • $586,560
For Sale • $650,000
$7/SF - $13/SF
For Sale • $375,000
Katie Worrall
263-2944
Katie Worrall
263-2944
Sam Suplizio
201-9444
Sam Suplizio
201-9444
North
825, 826 & 829 Air Tech Court
North
2751 Crossroads Boulevard
City
510 28 1/2 Road
City
3rd Street & Colorado Avenue
•1.48, 1.89 & 2.42 Acres – Zoned I-O
•Airport and I-70 proximity
•Airport Close, Interstate Access
•2.46 Acres, Zoned C-1
•3.61 Acres Land - Zoned C-1
•Development Potential Just Off North Avenue
•Prime Investment or Development
•11 City Lots - Downtown Grand Junction
$405,653 / $514,550 / $658,844
For Sale • $850,000
For Sale • $1,200,000
For Sale • $1,718,750
Sam Suplizio
201-9444
Kelsey Sharpe
241-2909
Les Smith
261-8056
Sam Suplizio
201-9444
City
2825 D Road
Clifton
3228 F Road
City
612 24 1/2 Road
Austin - Antelope Hills
170 DR Road
•10.52 Acres - Parkway Frontage
•Future Land Use Plan - Comm./Ind.
•4.27 Acres Zoned C-2
•Corner of F Road & 32 Road
•3.71 Acres - Zoned C-1
•Mesa Mall Close
•Homes, Orchard & Development
•200 AC Orchard - 2,175 Total Acres
For Sale • $1,718,750
For Sale • $1,299,000
For Sale • $2,424,000
For Sale • $19,000,000
Jere Woldruff • 778-1567
Mary Ann Severin • 250-9917
Sid Squirrell
263-2947
Sam Suplizio
201-9444
Dick Thompson
260-2007
-C
resource roster
online
Area Info
Fruita Chamber of Commerce
www.fruitachamber.org
Grand Junction Business Incubator
www.gjincubator.org
Grand Junction Chamber of Commerce
www.gjchamber.org
Mesa County
www.mesacounty.us
Mesa County Assessor
www.assessor.mesacounty.us
Town of Palisade
www.townofpalisade.org
Garfield County
www.garfield-county.com
Montrose County
www.co.montrose.co.us
Broker Sites
Ed Slater, Broker Associate
www.edslater.com
Sid Squirrell, CCIM
www.gjcommercial.com
Sam Suplizio, Broker Associate
www.supliziocommercial.com
Business
Business News
www.bizjournals.com
Western Colorado Business
www.westerncoloradobusiness.org
LoopNet
www.loopnet.com
Grand Junction Information
City of Grand Junction
www.gjcity.org
Downtown Grand Junction
www.downtowngj.com
Grand Junction Links
www.gjlinks.com
Visit Grand Junction
www.visitgrandjunction.com
Media
Daily Sentinel
www.gjsentinel.com
Free Press
www.gjfreepress.com
Helpful Sites to Visit & Use
Colorado Trip
www.cotrip.org
Discover Our Town
www.discoverourtown.com
Hometown Locator & Information
www.hometownlocator.com
Map Quest
www.mapquest.com
Microsoft Mapping
http://local.live.com
Sperling’s Best Places
www.bestplaces.net
Switchboard
www.switchboard.com
-C
Property Sector Cycles
The general outlook for the United
States golf industry in 2007 is one of
guarded optimism. The pace of new
course development continues to slow,
rounds played appear to be increasing
(albeit at a nominal rate), investment
capital is flowing to golf in response
to potentially higher returns relative to
other real estate sectors, and last but
not least, the Boomers are coming! The
Boomers are coming!
Without a doubt, the golf industry
is still dealing with the effects of the
building boom of the late 1990’s. In
total, from 1996 through 2000, 1,737
18-hole equivalents entered the market,
with the majority of these developments
targeting the high-end public course
market. The rapid increase in golf
supply, coupled with the 9/11 terrorist
attack and subsequent economic
downturn, had a significant impact on
the golf industry. Competition among the
existing and new courses became fierce,
resulting in fee discounting to maintain
market share with the resulting loss in
top-end revenue translating directly to
the bottom line, squeezing net operating
income margins.
Fortunately, new development has
slowed, in part because of market
awareness of the altered competitive
landscape. Additional contributing
factors are reduced capital availability
and a decline in golf and residential
development in light of high
construction costs relative to the value of
the course at completion. Bottom line,
the National Golf Foundation (NGF)
reported that course openings fell to
124.5 in 2005, with between 120 and
140 slated to open in 2006. Because
new course development is a lengthy
and challenging process, it is not likely
that the development spigot will be
turned on again in the near term.
With the supply side of the equation
seemingly coming back to neutral,
markets are beginning to digest the
additions to supply. NGF same store
rounds data, for the year to date through
August, are up 1 .4% over the same
period in 2005. Granted, this is not
robust growth. However, slow growth is
better than no growth, and is certainly
better than negative growth. Having said
that, operators indicate the reality that
while downward pressure on rounds
may be abating, rounds remain below
pre-2001 levels, and fee discounting is
still prevalent in most markets.
Golf, although not one of the four
major real estate food groups, has
become an attractive investment in
and of itself. Investment capital dollars
are flowing to golf, much as they have
flowed to other property types. Wall
St. firms such as Deutsche Bank and
Goldman Sachs have interests in golf
real estate portfolios. CNL
Although most banks shy away from
golf loans, the industry has a group of
specialized lenders dedicated to the
industry. Capmark (formerly GMAC),
GE Real Estate and Textron Financial
represent the primary debt providers
in golf, and all have golf-savvy lending
and underwriting teams in place. As
with golf cap rates, loan rates in golf
are generally higher than for other
property types. Golf loan parameters
have been generally stable, with interest
spreads ranging from 200 to 400 basis
points above LIBOR or treasuries, with
debt coverage ratios at 1 .25 to 1 .35x
EBITDA. Golf lenders are generally cash
flow lenders, meaning that cash flowing
properties without a story stand a better
chance of being funded. Lastly, if you
are looking for funding for the course
you are proposing to build on the family
farm - keep looking - such loans are
reserved only for those that don’t need
them.
Who’s that knocking on the door?
You guessed it - the Baby Boomers! The
78 million post-WWll Baby Boomers
are coming to retirement age, turning
60 years of age at the rate of 7,900
per day. The golf industry is salivating
over this emerging demographic that is
anticipated to have both the time and
the financial ability to play more golf.
NGF estimates that Boomers will play
75 to 100 million incremental rounds
annually by 2015.
Should the NGF estimates hold
true, the financial impacts on the golf
industry will be substantial. But before
the party gets started, a word of caution
is warranted. According to a Del
Webb survey, the Boomers, although
considered an active generation, will
be working later in life. Also, this
group will be pursuing many varied
interests upon retirement, and golf will
represent only one of the activities
available to them. Lastly, senior golfers
are notoriously fee-sensitive, and the
Boomer generation will undoubtedly
tighten their purse strings in light of fixed
income limitations upon retirement.
With these cautionary words in mind,
the question is not if the Boomers will
affect golf demand, they most certainly
will. The real question is the degree to
which demand will be augmented. To
that question, the answer is, only time
will tell.
In conclusion, the slowing of new
construction has been good news for
the golf industry. Markets are showing
signs of returning to equilibrium, and
rounds played appear to be increasing.
However, increased fee discounting
will continue to affect top end golf
revenue. Future risks to golf’s continued
improvement include (among others) a
downturn in the economy, increasing
fuel prices and terrorist events. An
occurrence of one or all of these risk
factors could potentially wipe out the
positive steps the golf industry has taken
over the past five years.
By: Integra Realty Resources Chicago, Cary A. Lannin
Preparing commercial property to sell for the highest possible price.
Commercial brokers are often
expected by seller clients to get the
highest possible price for their assets.
Some properties are diamonds, some are
dogs, but the objective is the same: “Sell
it for all it’s worth (plus 20 percent)!”
Getting top dollar for your property
isn’t a given, particularly if an owner
hasn’t prepared its property to sell at
the highest possible price. Often over
looked is the preparation of the asset for
sale before it goes to market. In selling
shopping centers, the context is multitenant retail buildings, but the concept
certainly applies to any commercial
income-producing property.
Once your property is on the
market the ideal is to sell it efficiently,
without undue complications, within
a reasonable period of time, for the
highest possible price that the asset will
justify. Achieving highest value is the
result of preparation, presentation and
implementation of a systematic and
thorough marketing program
•Recordkeeping.
Get your books and records in order.
Starting with poor records keeping
slows the process and turns off serious
investors. Accounting should include the
previous two to three years’ profit, loss
and operating statements. Preview your
accounting and if you can’t define and
explain accounting line items, reclassify
them so it makes sense to a buyer. Have
your books in a consistent format year to
year. Be prepared to explain your books
item by item.
Your management files should be
complete, including tenant rental
history, delinquency report and annual
reconciliation of operating expenses.
Failure to support actual expenses will
result in prospective buyers assuming
the worst and making deductions from
the offer price.
Get your tenant and management files
in order including complete lease files
for each tenant and an accurate rent
roll with accurate lease terms, rental
increases and options. If you don’t have
a tenant lease summary for each lease,
create one. It will save hours during the
due diligence process.
Get copies of past surveys,
environmental reports and title reports
and make them available electronically
on a moment’s notice.
•Know your tenants.
Know what their business is and their
general financial condition. In your
marketing material present their positive
aspects, conversely, be prepared to
acknowledge their weaknesses.
Photo courtesy of Jim Bennett
•Dealing with vacancies
and weaknesses.
A prospective buyer may be very
critical of your noncredit tenants and
use that against your value. Create a
tenant summary profile and sell your
tenants as stable and capable of paying
the rent. Tell your tenants in advance the
property is for sale so it won’t come as a
surprise to them and allay their anxiety
of new ownership.
•Dealing with vacancies
and weak tenants.
Weak tenants and vacancies’ are not
necessarily detriments if there is upside
to sell! The marketing material should
contain (and, validate) income potential
for the vacancies and re-tenanting weak
tenants. Show the buyer how they and
improve the investment or at the very
least make them confident they can
maintain the current economics.
•Prepare the property.
Significant deferred maintenance
items such as major structural, roof,
mechanical and parking lot, will hit the
purchase price square in the kisser. You
should decide if you want to fix deferred
maintenance items prior to sale. If you
haven’t maintained the property thus far,
be prepared to discount the purchase
price; however you should have bids in
hand for the proposed repairs so you are
prepared to negotiate with buyers.
•Disclosure.
Believe it or not, few things legitimize
a transaction more than a Seller who
discloses shortcomings early! Serious
buyers will discover your property’s
shortcomings so get the dirt on the table
early.
Doing so ensures you won’t waste
time with disillusioned buyers (also
keeps you out of court) and will win
trust with serious buyers.
•Due diligence process.
This process can be orderly or
chaotic. The seller’s goal is to keep
the due diligence process as short as
possible and not waste time going too
far down the road with a non-buyer. A
well-prepared seller should be able to
provide the bulk of the due diligence
material in a few days. The days of
copying material and mailing (or faxing)
are long gone. Thus, assume the task of
scanning all your books, records, leases,
surveys, environmental reports and any
other pertinent items to an electronic
file.
•Pricing.
No seller wants to leave money
on the table; however, there is a big.
difference between a legitimate asking
price and ridiculous. The old school
strategy of asking for the moon then
negotiating way down is foolish and
works against sellers. If you drop your
price by $1 million, a buyer will think
“I can negotiate it down $2 million.”
The harm in asking way more than a
property is worth is that the professional
buyers, the serious buyers who often
have timing issues, don’t have time
to play that game. They prefer to deal
with a reasonable seller and often
won’t even inquire about a property
that is obviously way overpriced. On
the other hand, how do you know you
aren’t leaving money on the table? If
your agent presents your property to the
worldwide market, the market won’t let
you leave ,money on the table! If the
property is properly priced, you should
get tens of inquiries and several offers
in the first 30 days. Nothing is more
powerful for a seller than to have more
than one competing offer and leverage
the competition and watch the value
move up.
•Perspective – Think Big!
The market for commercial property
is national if not global. For example,
last year in the United States, more than
10,000 properties sold in the category
above $5 million. Many purchased by
first-time investors often were completed
over state lines. This is an era of fluid
capital and lenders don’t think twice
about moving capital around the nation.
If you don’t promote your property on
a global scale, likely you will attract
a limited number of suitors for your
property and the value will likely be
compromised. At the time of sale,
owners of commercial real estate should
be rewarded for their hard work and
risk of ownership. So take a little time
to prepare that asset so it shows in the
best possible light and you will find its
highest worth on the open market.
This article authored by: Tom Dermody,
CCIM, Senior Investment Advisor, Sperry Van
Ness, Monument. Taken from the Colorado
Real Estate Journal , May 2nd 2007 issue.
-C

970.241.2909 - Bray Commercial Real Estate

Transcription

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