This post originally appeared on tBL member Allen C. Buchanan's blog Location Advice and is republished with permission. Find out how to syndicate your content with theBrokerList.
When marketing your property insist that the broker incorporate best practices when touring prospective tenants through your commercial real estate. Here some reasons why!
The commercial building that you own has sprung a leak – AKA the faithful occupant has decided to vacate and leave you with an empty building.
Frankly, this is not occurring much these days as ninety eight of every one hundred industrial buildings are occupied in Southern California.
However, certain circumstances cause a vacancy – the business outgrows the building, is acquired, goes broke, or realizes that the building is now too big for their operation.
If you are fortunate enough to receive some notice from the occupant that a vacancy is imminent, good for you! Now, let’s use that time wisely in securing a tenant or buyer for your fallow commercial real estate.
Generally, you will engage a commercial real estate professional to market your vacancy. His services will include preparing professional collateral such as brochures website, and postcards. He will install an available sign. Your vacancy will be published in all of the multiple listing services. She will broadcast the availability through conventional means such as newspaper ads, mailers, cold calling, and broker open houses. If your commercial broker is really creative, a virtual video tour of the property will be produced and social media marketed.
Great! Now you just sit back and wait for your broker to call you with a multitude of offers, right? Very rarely, unfortunately. The one thing that will quell an active, well priced, highly sought after size ranged building is the showing protocol. In other words, how will active occupants and their commercial real estate representatives tour your property?
If the property is vacant, you have a couple of options. Option one is that your broker can install a lockbox on your building and allow a free flow of tours. Option two is that your broker is required to be present at all showings.
But, what if the building is occupied during the marketing process? You also have a couple of ways to accommodate interested parties. You can require your broker to guide the tours or you can allow interested parties to walk through un-escorted.
So vacant or occupied, should you require your broker to be present during showings? I could wax forever on the pros and cons of each approach but I believe you should insist that your broker guide the tours of the property for these three reasons.
Limit the occupant disruption. If your building will be occupied during the marketing, a great deal of occupant disruption can be avoided by requiring that the tours be guided. Remember, the occupant has paid you rent for a period of time. Parading folks through the space un-bridled without proper notice and consideration is worth avoiding.
Control the flow of information. If the tours are guided, the tour guide (your commercial real estate broker) can insure that all parties have a proper brochure, understand your motivation – whether you want to lease or sell the building, and can make sure that all of the potential occupant’s questions are answered and that a course of follow up is established.
Qualifying. If your representative is present during the tours, she gets a first hand feel for the occupant’s interest, use, financial capability, competition, and a general “gut feel” for the viability of your space.
Additionally, there is no way to control the access of a lock-boxed vacant building. Your broker may provide the code to a fellow broker, assuming that the fellow broker will guide his client through. In reality, the fellow broker might simply give his client the lockbox code and you have lost control of the access.