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Choosing the Best Commercial Real Estate Agent for Your Needs in New York City
Whether you're buying or selling commercial property in New York City, the right commercial real estate agent can use their skills and network to find the ideal place. There are a wide variety of commercial spaces in New York City, from boutiques and restaurants in Soho and the West Village to warehouses in Brooklyn and Queens. NYC has five ever-evolving boroughs, and the best commercial real estate agent is someone who has a firm grasp on your needs and expectations and is familiar with a particular property's location.
You might have questions about the exact role of a commercial real estate agent. Do they have an existing network of potential buyers or access to listings that fit your location and size criteria? What are the differences between a residential and a commercial real estate agent? Are they able to assist with property renovations and inspections?
Below you will find an in-depth look at what a commercial real estate agent does, the benefits of using one, and how to find a commercial real estate agent for your project in New York City.
What Is Commercial Real Estate?
There are four types of real estate: residential, industrial, land, and commercial. Residential real estate is the most consumer-facing and deals with the construction of new homes, as well as the buying and selling of existing properties. Industrial real estate handles buildings and warehouses designed for manufacturing and follows very specific zoning, construction, and transaction protocols.
Commercial real estate covers everything from apartment buildings to shopping malls to office space for Fortune 500 companies. It can be broken down into four categories:
- Housing
- Hotels
- Retail
- Offices
All real estate agents help with the process of buying, selling, or leasing a property. But in commercial real estate, these deals are often more complex, and the value of the properties is usually much higher. They also take a significant amount of time to complete.
Commercial real estate agents are used to these types of deals and are equipped with the interpersonal skills to handle them. You will also find that the best commercial real estate agents can often tap into their existing network to find potential buyers as well as available properties.
Reasons for Hiring a Commercial Real Estate Agent
With commercial real estate, there are often many moving parts, and they all need to be addressed to ensure that a deal is reached. Arriving at an agreed price, signing all the necessary paperwork, closing escrow, and transferring ownership can take several months. Because of the long process, it's important to have insight into market trends and what kind of investments other businesses are making so you can strategize a good time to buy or sell.
The best commercial real estate agents can also assist by offering skills and services that lead to a deal both sides can agree upon. While certain responsibilities exist whether you're buying, selling, or leasing a property, a commercial real estate agent can also assist with necessary tasks that aid the process for all parties involved.
Assistance with renovations and staging can help prepare your property for quick showings to interested parties. In-depth knowledge of the market can help to generate better offers. And knowledge of zoning regulations and contracts can help to save you time and stress.
Selling Commercial Property
An effective commercial real estate agent can help you price your property based on current market trends. They likely also have a network of other agents, brokers, investors, and prospective clients for your property. Having these relationships allows the agent to go directly to potential tenants, which can help expedite a deal.
Other factors go into successfully selling a commercial property. These include identifying and undertaking any renovations that are needed and staging the property with furniture and design accents to visualize the potential of the space. A commercial real estate agent may help with both of these.
The location of the property you are trying to sell factors into the sale price and the ROI for the space. New developments, especially those with consumer-facing properties such as Hudson Yards in Manhattan or Sunset Park in Brooklyn, offer increased foot traffic and other incentives that could make your property more appealing. A commercial real estate agent can help you craft a narrative around your property that makes it more attractive to investors.
Buying Commercial Property
Whenever you buy a commercial property, having a good commercial real estate agent is invaluable. You might have your eyes set on a modern office in the heart of Midtown Manhattan, or maybe you prefer an industrial loft space in Williamsburg. In order to purchase one of these properties, you need to know what's on the market and have relationships with the people who are selling these spaces.
Commercial real estate agents have detailed information on available properties and can present you with listings tailored to your needs. In addition, they can negotiate a fair price with the seller. They are also on top of hidden costs or potential renovations needed to maintain the property.
Checking that electrical and HVAC systems are functional and providing environmental research about the carbon footprint and ways to minimize energy use are additional responsibilities that a commercial real estate agent may take on. They also deal with property inspections and have in-depth knowledge regarding zoning and permit laws.
Leasing Commercial Property
Sometimes, you want to lease commercial property for a special project or because you're not looking to invest in a long-term property. Because commercial property is often valued quite high, you need to have insight into which properties are available for lease. A good commercial real estate agent knows what's on the market and can provide insight into other tenants nearby. They may also be able to negotiate a lower rent in your lease agreement.
Trendy Soho and the revitalized Financial District are often filled with unique commercial properties for lease. Commercial real estate agents can get you access to these spaces and help make the entire process less tedious.
Benefits of Using a Commercial Real Estate Agent in the Five Boroughs
The buying, selling, and leasing of commercial property is a complex process. A good commercial real estate agent will help you:
- Connect directly with reliable tenants
- Find commercial properties that meet your search requirements
- Gain insight into market trends to help you determine a selling or bidding price
- Understand and adhere to zoning regulations, permit requirements, and other operational logistics
- Stage properties for viewings, conduct renovations, and organize property inspections
- Facilitate final paperwork and financial transactions
Your Guide to Hiring a Commercial Real Estate Agent
New York City has a diverse property landscape, and every agent brings a different value to the table. When choosing a commercial real estate agent, consider these topics.
What Type of Commercial Property Are You Looking For?
A commercial real estate agent who has a portfolio of potential hotel spaces in Brooklyn might not have the same access in Manhattan. If you're looking for office space, it's important to consider that in New York City, these properties fall into the three different classifications. Class A spaces feature high-end finished amenities and a top-end price that often requires the right introduction to put in an offer.
Class B properties are generally one or two decades older and have had previous tenants. A commercial agent who specializes in these types of properties might not be interested in finding you a Class C property geared toward functionality because real estate agents work on commission. It's important to discuss your goals early on so that you are only presented with properties that are of interest to you and that the commercial real estate agent is excited to show.
Ask Questions
You will be dealing with your commercial real estate agent on a regular basis until the property is sold, bought, or leased and officially off the market. Set up your search for success by having a better picture of your agent's network, portfolio, and previous deals. Ask them to provide you with market-based demographics and financial analysis to get a sense of their knowledge and understanding of the project.
Interpersonal skills are key because your commercial real estate agent will be negotiating on your behalf. Make sure you feel comfortable with the person you are giving that responsibility to.
Focus on Location
As previously mentioned, New York City is one of the world's megacities, with a population of over 22 million people in the metro area. It has every neighborhood, style of architecture, and office space layout that you can imagine, located in landmark buildings and repurposed spaces. Having a comprehensive knowledge of the entire area and access to the best properties of each is challenging.
Different portions of the city are loosely based around a specific industry, which can affect the foot traffic that passes by and also the travel time between locations. Are you looking for retail space on the Upper East Side? Connect with commercial real estate agents with offices or relationships in that area. Looking for a startup office in a repurposed space in Red Hook? Make sure your agent is familiar with the area and the zoning and permit regulations.
If you're selling a property, let the commercial real estate agent help shape a story that includes the area and why it's special, along with any other unique selling points such as design, style, or previous tenants.
What Are Your Objectives?
The right time to buy or sell a property is heavily dependent on the market. If your goal is to turn the maximum profit, then you should work with an agent who can determine the right time to list a space for sale or to put in an offer.
If you're buying a property with the hope of future returns, then you should choose a commercial real estate agent who is familiar with the area where you're looking to purchase and its local tenants and landlords. Using this information can help you to estimate future increases in property value.
Also, consider whether you're looking for space to grow. It's well-known that the amount of space you get in Manhattan for the price asked is very low. If you think your company or business might need more space in the coming years, consider working with a commercial real estate agent to find a space you can evolve into over time.
Do you have a consumer-facing business? Examine the market and see if it makes sense to have a large space to reach targeted foot traffic. Or perhaps it makes more sense to find a commercial real estate agent who works in Park Slope because your business is focused on creating a larger online presence. Different areas of the city reach different groups of people, and working with a specialized commercial real estate agent can help you identify the area that's the best fit for you.
Hiring the Best Commercial Real Estate Agents in New York City
The right commercial real estate agent can be the key to finding your next commercial space or selling a property you already own. Their network, previous relationships with landlords and tenants, and understanding of evolving market trends make them a valuable resource during this complex process.