Selling Commercial Property Privately in 2023: Your Comprehensive Guide

Your Property Solutions Ultimate Guide to Selling Commercial Property Privately

Selling commercial property can be a complicated process that involves careful planning and smart decision-making. It often prompts owners to consider two primary options: engaging the services of a real estate agent or initiating the process of listing their property for sale. However, an alternative approach offers numerous advantages and greater control over the process: selling your commercial property privately.

Private sales, in which sellers communicate directly with potential buyers without using an estate agent, have gained popularity in recent years. This approach offers several advantages and allows you to customize the sale according to your specific needs and preferences. In this comprehensive guide, we will delve into the world of selling commercial property privately in 2023.

Different Ways to Sell Your Commercial Property

1. Selling as is where is:

One option is to sell your commercial property "as is where is," meaning the property is sold in its current condition without any repairs or renovations. This approach can be suitable if you're looking for a quick sale or if the property requires extensive seismic upgrades or deferred maintenance.

2. Sell by using a commercial real estate agent:

Engaging a commercial real estate agent is a traditional method of selling commercial property. Agents have experience and expertise in marketing properties, finding potential buyers, and negotiating deals. They can help you understand the commercial real estate industry's complexity and reach a broader range of prospective buyers.

3. Sell your commercial property directly to an investor:

Investors are often interested in acquiring commercial properties to generate income or for potential redevelopment opportunities. Selling to an investor can result in a faster transaction and may be particularly beneficial if you're looking for a hassle-free sale.

What are the benefits of Selling Commercial Property Privately?

Pros:

Cost savings: By eliminating the need for a real estate agent's commission, selling privately allows you to retain a larger portion of the sale proceeds.
Control and flexibility: Selling privately enables you to have full control over the sales process, including pricing, negotiations, and timelines. You can adapt the strategy according to your specific goals and preferences.
Direct communication: Engaging directly with potential buyers fosters better communication and eliminates the risk of misinterpretation or delays caused by intermediaries.
Faster transactions: Private sales often have shorter closing periods, as there are fewer parties involved, reducing the time required for negotiations and paperwork.

Cons:

Marketing and exposure: Without the assistance of a real estate broker, it may be more challenging to market your property effectively and reach a broad audience of potential buyers.
Limited networks: Private sellers may have a smaller network of potential buyers than established real estate brokers with extensive industry connections.
Expertise and negotiation skills: Selling privately requires a good understanding of the commercial real estate market, negotiation skills, and legal knowledge. Lack of experience in these areas could potentially affect the outcome of the sale.

How do I sell commercial property privately?

Now that you've learned about the benefits of selling your commercial property privately, let's look at the process.

Step 1: Research and Select a Reputable Buyer

The first step in selling your commercial property privately is to research and select a reputable buyer. Look for buyers who have a proven track record of purchasing commercial properties quickly and fairly. You can also seek references from other building owners or conduct a Google search to identify potential buyers.

Step 2: Provide Information About Your Property

You'll need to provide information about your property to potential buyers once you've identified them. This should include information regarding the property’s location, size, condition and any relevant financial information.

Step 3: Schedule an Inspection and Receive an Offer

After providing information about your property, you'll need to schedule an inspection with the buyer. This will allow them to evaluate the property's value and make you an offer. Once you receive an offer, it’s up to you to decide whether to accept and proceed, counter offer or reject the offer.

Step 4: Review and Accept the Offer

If you accept the offer, you have to review and sign a sale & purchase agreement. The S&P is a legally binding contract that stipulates everything about the transaction.

Step 5: Close the Sale and Transfer Ownership

The final step in selling your commercial property privately is settling the sale and transferring ownership. This will involve signing the necessary legal documents and receiving the funds to complete the sale.

Key Points to Know When Selling Commercial Property Privately

Importance of selecting a reputable buyer

When selling your commercial property privately, it's important to select a reputable buyer who has the financial resources to purchase your property. You can research potential buyers by references.

Understanding the value of the property

To determine the value of your commercial property, you can hire a valuer or research recent sales of similar properties in your area. It can also help to establish a fair asking price and negotiate with potential purchasers if you know how much your commercial property is worth.

Knowing the market conditions and trends

It's important to stay up-to-date with the market conditions and trends that can impact the sale of your commercial property. Conversely, if there is a glut of commercial properties on the market, you may need to adjust your asking price or marketing strategy.

Preparing for negotiations

Negotiating with potential buyers is a key part of the selling process, and it's important to be prepared. Knowing your bottom line and being willing to walk away from a deal that doesn't meet your needs is crucial in avoiding underselling your asset. Being willing to listen to the buyer's concerns and negotiate in good faith to achieve a mutually beneficial agreement.

Understanding the legal and financial aspects of the sale

Selling a commercial property involves a range of legal and financial factors, and it is vital to understand these aspects of the transaction. You may need to consult with a to prepare legal paperwork such as the sale & purchase agreement.

Why sell your commercial property to a private buyer?

Selling your commercial property to a private buyer offers several advantages:

Streamlined process: Selling privately reduces the number of parties involved, simplifying the transaction and reducing the potential for complications.
Efficient negotiations: Direct negotiations with a private buyer can lead to faster decision-making and more efficient discussions, allowing you to reach mutually beneficial agreements swiftly.
Personalized attention: Working directly with a private buyer allows for personalized attention and a deeper understanding of their needs and objectives. This can help tailor the sales process to align with their requirements.
Flexibility in deal structures: Selling to a private buyer can offer more flexibility in structuring the deal, including potential creative financing options or seller financing arrangements.

Selling commercial property privately can be advantageous for property owners looking for more control, cost savings, and faster transactions. While there are potential challenges and considerations involved, understanding the benefits and following the necessary steps can help you navigate the private sale process successfully.

If you are ready to sell your commercial property privately, WE CAN HELP. Give us a call and let Your Property Solutions help you sell your commercial property quickly and easily.

Billy

Your Property Solutions