Tom Miller, CCIM
Troublesome Business Expansions or Relocations and What to Do Instead
The most common disruption to a smooth transaction stems from a lack of communication from the client.
Simply put, if your real estate professional doesn’t know what you really want, and when, where and why you want it, then at best there will be wasted time and effort and at worse the transaction will be one in which you wish you never started. Frank, truthful communication with your agent is paramount to laying the foundation for a successful, smooth transaction.
Bad timing is next on my list for creating a troublesome deal.
Too early is bad enough, but too late really hurts. Starting the process too early means that when it’s time to really get your property search going, its already ‘old news.’ That translates to a lack of energy from the landlord side and possibly not the best pricing. Projects are only new and fresh once, so don’t waste that momentum by cooking your dinner too early. Being too late is costly in terms of limiting your options had you started at the right time. Then you are relegated to dealing with what can work now, rather than all the options that were available earlier. So when should you start? The exact time varies considerably based on the specific tenant. If at all possible, it’s best to consult with your real estate professional roughly a year in advance of your lease termination, and longer if you have significant infrastructure within your facility. Doing so gives your agent time to guide you about perfect timing for your scenario. Above all, use your agent as a free, professional consulting resource. You should expect excellent advice from these professionals as you would you attorney, CPA or other industry expert.
Engaging more than one real estate professional sets the stage for trouble.
This bad move stems from the misguided notion that if one agent is good, two must be better. But it won’t take long for each agent to realize that he or she is one of a few working the same deal – and then everyone gives up. When this occurs, no one cares to engage on any terms since they already have wasted time and effort. Instead, pick the best agent you can find and run with him. If need be, you can change agents at a later date, but do it by telling your agent first.
Calling off real estate signs is risky.
We explore this topic extensively in our post, “The Hidden Trouble with the Landlord’s Real Estate Agent,” but here’s the short version. When you call off the real estate sign, you are contacting the agent who has been hired to represent the landlord. If he’s representing the landlord, then it is the landlord’s interests that he is protecting – not yours. Communication with an agent representing the other side is best handled by your agent. They know what to say, what not to say and they do it daily, so they are well versed in industry nuances.
Here’s the bottom line to launching a smooth and ultimately successful transaction. Choose an experienced agent with a long list of successes to his name. Talk to him early in the game. This way, you get the benefit of his expertise before things start happening. Let him review your plans and expectations, and be prepared for some degree of adjustment based on your agent’s own experiences. If you meet with a potential agent and this is not the case, you have either created an absolutely perfect plan all by yourself or you need to meet with a better agent.
Read more about finding the right agent with these posts:
What’s the Best Way to Pick a Commercial Real Estate Agent in a New State?
Looking for the Right Commercial Property? Here’s How to Find the Right Agent First.