With commercial real estate, sellers do not have control over every variable. Any factors that sellers can control, they should take steps to not make more complicated than necessary.
Forbes explores several common commercial real estate blunders sellers make. Learn from others’ mistakes rather than make and learn from your own.
Ill-managed financial records
How well do you manage your commercial property’s tax records? Your attention to detail regarding your property’s finances could either make or break a deal with a lender. Specifically, look over all expenses for classification accuracy, and depreciate capital expenses and any property upgrades your tenants make. You are better off not attempting any tricks on your taxes to reduce your taxable income.
Not sharing tenant defaults
Tenants who fall behind on rent and building code failures may not be your fault or something you want to share. No matter who bears the blame, share all defaults with potential buyers. Depending on how deeply interested buyers research your property, they may uncover these issues on their own. If they do, they may wonder why you were not upfront about everything.
Inaccurate property pricing
You must price your commercial property at its current value, not the price you wish it were worth. True, you have several factors to consider when developing a fair price, such as market and property type, but you do not want to make interested parties immediately skip your property when they see your asking price. Price the property in a way that starts a conversation and invites questions from buyers.
Give yourself every advantage when selling commercial property. Double-check that you do not make the above mistakes.
