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Choosing the Best Commercial Real Estate Agent for Your Needs in Portland, OR
Portland is teeming with commercial properties. From retail spaces in beautiful historic buildings such as The Pacific Building to large warehouses and industrial spaces in areas like Northwest Industrial, there's an abundance of property for commercial real estate agents to buy, sell, and lease in the city.
Working with a licensed real estate agent is the best way to make sure that your interests are protected if you're looking to buy, sell, or lease property in Portland. An agent knows the ins and outs of the market, and most have extensive experience in negotiating. Regardless of your plans, an agent's experience can help you save money and time.
Below, we discuss what services you can expect to receive from an agent in all types of transactions, what to look for in a commercial real estate agent, and how to find the right agent to suit your needs.
Services Offered by Commercial Real Estate Agents
A real estate agent acts as your representative, regardless of what end of the transaction you're on. With expert negotiating skills, an agent makes sure you get the best available price or earn top dollar for the property you're buying, selling, or leasing. They have access to the most up-to-date market analyses and listings and can ensure you're getting a fair deal.
Selling Commercial Property
When you work with a commercial real estate agent to sell your property, you can expect them to take a comprehensive and strategic approach to selling. Before getting ready to list your property for sale, they will likely meet with you at the property to conduct a thorough walk-through and provide you with an estimate of what they think it will sell for. During this walk-through, they may also offer you advice on repairs to be made and different ways you can stage the property to ensure it's appealing to potential buyers. In addition to making these recommendations, most agents keep lists of preferred vendors who can be trusted to complete repair work, cleaning, or staging quickly and for a reasonable price.
Once they've seen the property, your agent will typically take time to compare your property to other similar properties in your area to see what they sold for and how long they sat on the market before selling. They also consider the potential for buyers to generate income based on the location and size of your space. They'll use this information to strategically price your property. If you're working with a good broker, they'll price your space attractively to entice buyers, but they won't sacrifice profit.
After pricing and listing your property, your commercial real estate agent handles all aspects of the sales process. This includes advertising it, showing it to prospective buyers, negotiating the price, and finalizing the sale. Of course, you'll have the final say in all negotiations. The agent collects their commission from you once the sale is closed and funds have been transferred to you from the buyer.
Buying Commercial Property
If you're in the market to purchase commercial property, either for retail space, warehouse space, or industrial purposes, a commercial real estate agent can help you with every step of the process. Your agent has access to the most comprehensive list of available spaces and can expertly search for a property that checks all of your boxes.
Once several properties that match your wish list have been found, your agent will arrange viewing times that suit your schedule and come along to show you the property. Commercial real estate agents are dedicated to helping buyers find a property they'll love and should take time to let you explore all the features of each property you see. While you may find something that works for you after just a few property tours, your agent will be dedicated to showing you as many as you need to find a place that best suits your business needs.
When you're ready to make an offer on a property, your agent can advise you on where to start and what your maximum offer should be. They help you come up with this number by analyzing recently sold, comparable properties, as well as by looking at income potential, current market fluctuations, and market predictions. After making this determination, your agent will put in the offer and handle the negotiating process on your behalf.
After an offer has been accepted by the seller, your agent continues to help you through the process of finalizing the sale. This includes signing final contracts, transferring funds, and collecting the keys. In most cases, the agent's commission comes out of the sale proceeds, which means that working with an agent to buy property won't normally cost you anything.
Leasing Commercial Property
Commercial real estate agents sometimes also act as leasing agents and property managers. If you're not in the business of buying property, you may want to look at renting a space for your business. Finding a real estate agent who also specializes in leasing is the best way to find a property that suits your needs at a rate that works with your budget.
The services a leasing agent can provide are comparable with what you'd experience when buying a property. They offer you complete representation as they search properties, schedule tours, and negotiate lease terms on your behalf. When searching for the right property for your business, a leasing agent will generally take into consideration the nearby points of interest and any surrounding competitors to ensure you choose a space that will help you increase your income.
How to Find a Good Commercial Real Estate Agent
Finding a real estate agent that you can work with is a more elaborate process than just searching online for someone in your area. It's important to make sure that the agent you choose has experience buying, selling, or leasing commercial properties in your area and in your industry. It's also essential to take time to look into who they are and how they typically conduct business.
Look into Their Background
A commercial real estate agent's licensing and educational background is of the utmost importance. While residential agents and commercial agents both require a license, it's expected that they have a broad knowledge of marketing, financing, and business. In fact, many real estate firms require their commercial agents to possess a college education in one of these disciplines.
In addition to education, a commercial agent should have a deep understanding of professional terminology and market analytics. They should understand topics such as capitalization rates, gross rent multipliers, and internal return rates. If you're buying a commercial property, make sure they can also provide you with important information about net operating incomes.
Take time to have a discussion with any agent you're considering working with. You can ask some of the following questions to get a better idea of their background:
- How long have you been licensed?
- What other credentials do you have?
- Have you always worked in commercial real estate. or did you previously buy and sell residential properties?
- What neighborhoods are you most familiar with in the Portland area?
- Do you specialize in specific industries or types of commercial properties?
- Have you ever worked with businesses like mine before?
In addition to asking questions and getting to know your commercial real estate agent, it's always a good idea to search online for reviews and testimonials from clients who've worked with them in the past.
Find Out Who They Have on Their Team
Most real estate agents have assistants who help them with legal paperwork, listing searches, and other tasks. If you're able to, take a few minutes to meet their right-hand person and find out what parts of the transaction they may be assisting with. Sometimes, agents' assistants are responsible for processing legal contracts and other documents, so it's important to know that the entire team you're working with is competent.
Ask What Types of Properties They Buy, Sell, and Lease
While you may think a commercial real estate broker can take on buying, selling, and leasing any type of property, there can be vast differences between leasing retail, office, and industrial spaces. This is particularly true when it comes to determining income potential based on size and location. While a retail property with high foot or drive-by traffic is likely to be valued higher, industrial space is worth more in an area that's not located near residential neighborhoods or busy office buildings.
Leasing agents should also understand that transactions differ vastly in disparate industries and building types. Full-service leases, which are common in office space rentals, include all taxes, utilities, and maintenance, while net leases require tenants to cover some or all of those additional costs on top of their rent. It's important that your agent understands the differences in these types of leases and is able to identify which is best for you and your business.
Find Out How They Access Market Data and What Analytics Tools They Use
While you may not have a working knowledge of the best real estate analytical tools yourself, it can still be helpful to ask a commercial real estate agent about their process. This gives you insight into how they will determine your best asking/purchase/lease price, and it offers you the opportunity to see how passionate they are about their job.
Make Sure They're Only Representing One Side of the Transaction and Have Your Best Interests at Heart
While it's not technically against the law in Oregon for a real estate agent to represent both the buyer and seller in a real estate transaction, it can get messy. It's difficult for a person to represent your best interests when they're also acting on behalf of the person you're negotiating with. In the event that you enter into a bidding war, your agent may no longer be able to represent your lawful interests, and, as per the state's regulations, you may need to discontinue working with that agent.
It's also important to make sure that your agent is working with your lawful interests at the forefront of their mind at all times. If you don't feel the agent you're considering will represent you in the way you want to be represented, consider interviewing other agents until you find someone you can trust and work well with.
Ask How They Keep Up-to-Date on Changes in Their Industry
The real estate market changes daily, and it's not uncommon for regulations and real estate procedures to change on a regular basis, too. It's important that your agent acts in compliance with all local, state, and federal laws and that they're abreast of any recent or upcoming changes to those laws.
When you meet with a commercial real estate agent, take time to ask them how they maintain a high level of knowledge regarding what's happening in their industry. Make sure they mention things such as regulations and laws, but also make sure that they are regularly following fluctuations in the market, major real estate developments in your area, and changes in the commercial landscape throughout Portland.