53 questions to ask before hiring a commercial real estate practicioner

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If you’ve never hired an agent to market your commercial real estate property the process can be daunting and many folks don’t know where to start.

There are tons of commercial practitioners, most are great and some….not so much.

How do you find the right person to help you sell your property?

After spending over 11 years in the commercial real estate business, I’ve had a chance to hire and refer business to over 37 brokers outside of the Knoxville, TN market for clients.

I’ve compiled the following checklist and interview questions to help you find the right agent for your project with minimal fuss.

Step one – private investigator

  • Ask your friends that have recently sold property if they have any recommendations.
    • Friends that are in these fields are great resources: accountants, appraisers, architects, real estate attorneys, commercial bankers, general contractors*, developers*, real estate investors* and economic development officials.
      • *these folks could be potential buyers but I would highly recommend hiring a broker and putting your property on the market so you can get the highest dollar.
  • Search LoopNet for similar properties to find brokers that are active in your market
    • Search criteria
      • Sale or Lease
      • Geography: By county (or larger geography depending on property type)
      • Building size: +/- 30% range of your property
  • Things to consider:
    • What brokers are listing the most property by similar property type and size range?
    • How many properties do they have listed?
    • Do their listings have good photos and complete information?
      • Does it look like they are still taking photos with a flip phone? – awful photos are completely unacceptable.
    • Do you think the properties are being marketed professionally?
  • Trust but verify – take your top picks and do a little sleuthing:
    • Google the agent’s name
    • This should bring up these websites:
    • Things to consider:
      • Is the agents profile complete?
      • Are they a Realtor?
      • Are they licensed?
      • Are they active members of a professional organization(s)? – CCIM, SIOR, ICSC, etc.
      • Do they communicate well online? – a lot of communicating happens via email and text.
      • Are you friends with any of their friends? – call your friends and ask what they think about the agent.
      • Does it appear that they are doing this part time or full time?

Step two – communication challenge

  • Test how they respond to inquiries:
    • Call or send a request for information on one of their listings via LoopNet or local commercial multiple listing service and see how quickly they respond. The agent should get back to you by the close of business or within 24 hours, max.
  • Setting up the interview:
    • Assuming all agents responded promptly, ask the agent to set the appointment.
      • This is another opportunity to see how well and timely the agent communicates.
    • Things to consider:
      • Did the agent send a pre-listing package?
      • Did they do a good job learning more about your project? (aka pre-qualifying)
      • Was the scheduling process clear and easy?
      • Did the agent show up on time?
      • Do they appear professional?
        • Notice their car, shoes and dress.
      • Did they come prepared?

Step three – the interview

  • Getting to know the agent:
    • How did you get started?
    • How many years have you been in the real estate business?
    • What were you doing before going in to commercial real estate?
    • What do you do for fun?
    • How are you involved in our community? (Church, volunteer, sports, etc.)
    • How do you network with: other brokers, developers, investors, chamber staff, economic developers, elected officials, planning commission, etc.
    • What professional organizations do you belong to?
    • Do you have a product and/or geographic specialty?
    • What percentage of your deals are commercial?
    • What is the average number of projects you have listed?
    • What is the average number of buyer rep projects you typically work at any given time?
    • What trade magazines or emails do you subscribe to?
    • Do you attend any national trade shows?
    • What continuing education classes have you recently completed?
    • How would your colleagues describe you?
    • How would you clients describe you?
    • Who were your two worst customers/projects? Why?
    • What did you like the most about your last transaction? Least?
    • When you think of salesperson, what words come to mind?
  • Marketing:
    • Could I see marketing material for a similar project?
    • Do you pay for upgraded listings?
    • What websites would you use to advertise my property?
    • Would you have professional photos taken of my property? Aerials? Video?
    • How would you market this property?
    • Do you share fees with other brokers?
    • What databases do you use to find and keep track of leasing and sales transactions?
    • What databases do you use to find occupiers and buyers?
    • Are you a paying member of Costar?
  • Communication:
    • How would you keep me up to date?
    • How often?
    • Who would be my primary point of contact?
    • What do you do when we haven’t had much interest in this project?
  • Process:
    • Describe the process for selling my property?
    • How do you organize the process of taking this project through to closing?
    • How do you manage your projects on a daily basis?
    • How many projects are you currently working on?
    • How long would the exclusive agreement be?
    • How do you get paid?
    • What would the commission be for my property?
      • How is this calculated?
    • When do you get paid?
  • My property:
    • Why are you interested in this project?
    • Why are you qualified to help me with this project?
    • Have you worked on a project like this before?
    • What’s good about my property? Challenges?
    • If you were the buyer, what would you want changed about my property?
    • What do you think this projects needs to be successful?
    • How does my property stack up against the competition?
    • How should we price the property?
      • What price range do you believe my property would sell for?
    • What is the percentage difference between asking price and a done deal in the market?
    • How long will it take to sell my property?
    • What do I need to do to get my property to sell for the highest amount in the least amount of time?
    • What vendors would you recommend to fix/enhance: __________?
  • Wrapping up the meeting:
    • After all these questions are you still interested in working with us?
    • What’s the next step?

All of my checklists are a work in progress. I would appreciate any feedback in the comments below.

If you’d like to learn more about interviewing here are some great resources:

How to Get Your Commercial Property on the Market Quicker

If you’re thinking about selling your commercial property be prepared to get asked for a lot of information about your property. If you want to get your property sold quicker, time to get organized.

Here is a quick checklist to get you started:

  • Most recent property tax assessments and tax bills
  • Most recent title policy insuring the property
  • Insurance policies with summary of insurance coverage,insurance inspector risk assessment report & premiums
  • Survey (ALTA preferred)
  • As-Built Plans and specifications for property (electrical, mechanical, structural)
  • Site plan
  • Copies of all recent appraisals, engineering reports, environmental reports
  • Cut sheets for furniture, fixtures and equipment (FFE) conveying with property
  • Warranties for real property improvements, FFE and personal property conveying with property
  • Certificates of occupancy
  • Written summary of all pending or threatened litigation, insurance claims, legal violations
  • Reports or studies to bring property in compliance with ADA
  • Schedule of special assessment districts and amounts
  • Schedule of impact fees paid or owing
  • All maintenance records for property
  • Any encroachments onto the Property, or from the Property onto other lands?
  • Are there any encumbrances on the Property that will not be cleared at Closing?
    Easements? Covenants Running with the Land?  Liens or other financial servitude’s?Leases?
  • All Leases, including any addendum’s, riders or subleases.
  • Rent roll
  • Profit & Loss Statement (keep five years back minimum)
  • Balance Sheet
  • Payroll register
  • Utility bills (keep at least two years minimum)
  • Fire protection system inspection reports
  • Tax returns

Further Reading: “The Checklist Manifesto: How to Get Things Right” by Atul Gawande

If you want a quick overview of The Checklist Manifesto, check out Derek Siver’s notes.

What am I missing? Feel free to add suggestions in the comments below.