Buchanan: Why do we make selling real estate so hard?

Selling or buying property is often complicated by paperwork and rules. A broker should be able to cut through the complexities. (iStockphoto) © Provided by LA Daily News Selling or buying property is often complicated by paperwork and rules. A broker should be able to cut through the complexities. (iStockphoto)

My neighbor constantly reminds me my voice echoes with commercial real estate owners well above his pay grade.

It’s certainly not my intention, but I take any comments to my missives seriously and attempt to morph into a more meaningful messenger.

Regardless of the size of a commercial real estate portfolio — one multifamily property or global holdings of distribution boxes populated with Amazon-eque tenants — investments are simple! Why do we make them so hard?

You see, any investment of money seeks a return. Period. Sure. You’d like the return to be commensurate with the risk. But after all the fancy terms of capitalization rates, internal rates of return, replacement cost, source of capital, exit strategy, expense leakage, cash on cash, leverage, etc., it’s really about this. I shell out this much money and get this much back. Mic drop.

Commercial real estate brokerage is simple. Why do we make it so hard?

A real estate transaction – whether it’s a sale or lease – has two sides: the owner and occupant. Now, the occupant may seek to lease or own and the owner may want to sell or lease, but you get the idea. Inject our representation and you now understand what we do. We are matchmakers of sorts.

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An owner engages us to locate a tenant or buyer to fill her vacant building or an occupant awards us the opportunity to source a location for their use. The former assignment is known as a listing and the latter an occupant representation.

If you ask me what I do and I respond, “I sell commercial real estate.” You might wonder, “What the heck is commercial real estate?” Many of our clients are family-owned and operated manufacturing companies experiencing a transition – such as a move. This might offer a better idea of what fills our days.

Networking is simple. Why do we make it so hard?

The true value of a commercial real estate professional is the depth of their network. Need a roofer? We’ve got you covered. How about a legal professional to draw a new LLC? Hold my beer, I have several. How about someone to install new warehouse racking? Yep. Got just the gal.

But all of these examples are “downstream” of the deal. By that I mean, the need is after or “downstream” of the sale or lease. But what about “upstream”? What classes of professionals see a transaction before it takes flight? The answer harkens back to what we do.

Remember, many of our clients are family-owned and operated manufacturing companies experiencing a transition like a move. If we focus on those professional service providers who complement not compete with our efforts – a treasure trove emerges.

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Here’s an example: Let’s say a manufacturing concern experiences a record year but leases their building. During a periodic meeting with her accountant, they discuss revenue and leasing. If the CPA advises his client to buy a building, you get the idea.

Business is hard enough. Your commercial real adviser should make it easier for you.

Allen C. Buchanan, SIOR, is a principal with Lee & Associates Commercial Real Estate Services in Orange. He can be reached at abuchanan@lee-associates.com or 714.564.7104.

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