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When I was on floor time the other day, some guy called and said he was interested in buying a multi-family property. I told him the first thing to do was get in contact with a lender, he said he had. So, I told him, sure I can help you find a property, no problem. Then he told me he already has a property in mind. COOL!
Today I met with him and it turns out the property is a $4.8 million apartment complex!!!!
He is interviewing a few Realtors to find his buying agent, and still working on getting the financing. He is worried about using me because I work primarily in residential, rather than commercial properties.
Any ideas how to convince him that I can handle it?
Actually I think in that situation, I would do a referral to a very experienced agent who is familiar with apartment complexes and get a nice referral fee. That way the buyer gets proper advice and representation from someone with experience, and you still get a nice referral fee. That would show the buyer that you truly have his best interests in mind.
I totally agree with Wendy. In some states, now, you actually have to be licensed in commercial in order to represent a client. A referral in this situation would be a win-win situation for everybody involved, including the buyer.
It's referral time. Maybe you can ask the agent you refer it to if you can tag along to learn a few things.
This is great advice. Ask your broker to recommend the best commercial agent in your franchise. Ask for a 25% referral fee and get it signed prior to giving out the name of the client.
Also, inform your client exactly what you're doing. Let him know up front that you want to provide the very best service and the best way to do that is to have a person in your office that specializes in multi units work with you, with that agent in the lead.
Here in AZ we call it "shadowing". Which means that you follow along on everything the agent does so you can learn. But remember that you are only a shadow. You do not get involved except when the other agents asks you something. It can be a great learning experience, and a paid one at that.
Also keep in mind that most people are not familiar with financing on Multi-family properties. In addition, if you decide to work with them PLEASE make sure they are working with a lender that has experience with MF. I have done a few of the deals and you need serious cash to buy. There are many, many documents the lender will need to review during your due dilligence period. Rent Rolls, Insurance Info, Zoning,Vacancy rates, utilities, on and on. The small ones take a couple of months to do but the larger properties will be under contract for months.
My first one was small and I was not well versed on it. My client was new to this type of property as well. Lucky for me we have an unbelievable commercial agent in our office who was more than willing to help answer any questions I had. If not for him I would have reffered it out.
I will say that they are fun deals to do, it's all a numbers game. No worries about carpet/paint colors, floorplan, and so on.
Since he already spoke with you and knows you don't have that experience why not team up with someone that does and help him together. He will get the service he deserves and you can learn a thing or two. Offer a 50/50 split with someone that specializes in commercial and you can let the buyer know he will have two people helping him, which is better than one. Of course you have to follow that up with great service!
When I was on floor time the other day, some guy called and said he was interested in buying a multi-family property. I told him the first thing to do was get in contact with a lender, he said he had. So, I told him, sure I can help you find a property, no problem. Then he told me he already has a property in mind. COOL!
Today I met with him and it turns out the property is a $4.8 million apartment complex!!!!
He is interviewing a few Realtors to find his buying agent, and still working on getting the financing. He is worried about using me because I work primarily in residential, rather than commercial properties.
Any ideas how to convince him that I can handle it?
Partner with an experienced commercial agent. Half a commission on a 4.8 million transaction is better than none.
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