How to Tour a Commercial Property - Three Truths to Remember to Not Expose Yourself
Whether you are in the market to purchase a property or lease a space, touring potential sites is an important step in the process. If you say the wrong thing you could lose your negotiating power.
Every real estate transaction involves touring properties to determine if it meets your criteria as well as to inspect the overall condition.
Brokers may tour five, ten or more properties with their client before a viable site is found. Tours could be with only you and your broker, but oftentimes the listing broker or property owner will be present. They may open the building and wait for you to finish your tour, but many will actually escort you through the property describing its amenities.
Property tours can seem straightforward and most are, but be cautious not to say too much thereby exposing your position. Below are three truths for an effective tour and successful transaction:
Truth #1 - Have a broker to represent you.
I am assuming you have an experienced and reputable commercial broker representing you. If not, you need one for several reasons. Ask other business associates who they use, do some research and interview a couple brokers to find one you are comfortable with.
Your broker represents your best interests and only yours. Be open and honest when explaining your needs, budget and timing.
He will probably provide you with a list of several potential sites to weed through. Review and research each site, drive-by the property if needed and narrow the list to less than a handful of viable locations. Your broker will then arrange for a tour.
Truth #2 - Keep quiet during the tour.
If the listing broker or property owner is present you need to keep quiet and let your broker do the talking. Even telling her your name or handing her a business card can shift the negotiating power from you to them.
Be sure not to make any statements about the property where the other parties could hear no matter how trivial as this could create a negative balance of power. Make note of your findings and discuss with your broker when you are alone.
Brokers and property owners negotiate transactions everyday and know what to listen for and how to read a situation.
Truth #3 - Take notes.
It may be helpful to create a spreadsheet for yourself listing your needs in order to compare easily to other properties you tour. Pictures are good to help you remember your findings.
Touring potential sites is one step in the purchase or lease process. These three truths gives you a guide on how to tour a property the right way and start off towards a successful negotiation.
Remember to let your broker do his job by asking the right questions and negotiation the deal. You should never contact the listing broker or property owner directly to ensure yourself a smooth transaction with favorable terms.