The availability of commercial property in California is declining. In Orange County, industrial space vacancy is 1.3%, and only 2.4% of the property is available for sale. Office space vacancies are at 2%, and there is no data on retail space.
Seeking property to use for your Orange County business requires working with a trustworthy, experienced commercial real estate broker. You need someone who is a good listener, can understand your needs, and is willing to answer all your questions.
The key to hiring a commercial real estate broker is asking the right questions. The eight questions below will help you decide if a broker is the proper person to help you find commercial property for your business.
1. What Areas Are You Familiar With?
You need a real estate broker with in-depth knowledge of the local markets when seeking commercial property. This allows them to advise you on the best location for your needs.
Whether selling or buying property, you want the professional handling your real estate transaction to understand what kind of clientele frequents the area, whether it is a good location for retail traffic or has easy accessibility for manufacturing and shipping.
2. What Is Your Experience in This Field?
Just like you wouldn’t go to a heart surgeon for a problem with your foot, you don’t want a real estate broker with plenty of residential experience but none with commercial property. Ask about past clients, office sizes, industries they handle, and anything else pertinent to your search.
Another factor is the broker’s number of closed deals, not the number of years in business. A broker may have been in the industry for 20 years but only working part-time with very few closed deals. Another broker may have been only in the business for five years but spent it putting in extra hours and closing hundreds of sales.
Ask about their credentials, including education, licensing, and any other qualifications they have. In California, to become a real estate broker, the applicant must pass a written examination, have at least two years of full-time licensed experience or the equivalent, or have a four-year degree in real estate.
3. What Hurdles Have You Encountered?
Commercial real estate brokers have likely encountered a few challenges when dealing with clients. This can be anything from meeting specific needs, excessive demands, tough negotiations, etc.
You can also ask about what problems they see with the current market. As real estate trends go up and down, so does your power as a buyer or seller.
Your broker can provide data and analysis to help you understand what direction prices are moving. This allows you to decide whether it is better to buy or sell now or whether it may be more financially beneficial to wait a few weeks or months.
4. Do They Offer the Services You Need?
Real Estate companies offer a variety of services. You want to ensure the real estate broker you hire provides the service you need. Specialized areas include:
- Buying and selling commercial property
- Buying and selling residential property
- Commercial property leasing
- Commercial property management
- Residential property management
- Investment consulting
If you are interested in real estate investing, seek a broker familiar with the particulars of the industry you will focus on. Some real estate brokers concentrate on a specific type of commercial property. This may be an industrial, warehouse, retail, or a building that houses all new offices.
When interviewing a broker, if they sound unsure about the service you require, find a commercial real estate agent comfortable meeting your needs.
5. Are You Familiar With Tenant Improvement Allowances?
If you are interested in leasing, rather than purchasing, commercial property, find out if your commercial real estate broker has experience obtaining improvement allowances during lease negotiations.
If you are interested in leasing property, find out if your commercial real estate broker has experience obtaining improvement allowances. This is important if you are anticipating a buildout in your office space.
A Tenant Improvement Allowance (TIA) helps new tenants with the build-out of their new lease space. Build-outs are improvements the new tenant makes to the area, making it usable for their business.
The cost of a TIA is generally built into the base rent. Make sure you and your broker have a solid understanding of the necessary improvements and their estimated cost.
6. What Will Your Services Cost Me?
Generally, broker compensation is funneled through the property or landlord. There are exceptions where a broker may charge for a project, like reviewing a lease. If you have any concerns about whether you will be paying fees, find out before you have the broker begin work.
Make sure you understand whether the buyer or seller pays the broker’s fees. Verify whether the broker will be acting on behalf of the buyer or seller.
In some instances, the broker may work on behalf of the seller. Their role is to get the best sale price for the property.
A buyer’s agent works on behalf of the buyer. Their goal is to look out for the buyer’s best interests, negotiating the best purchase price.
Whether buying or selling, ensure you understand what role the real estate broker plays and how involved they will be in finalizing the deal.
Commercial brokers only receive payment once the deal is complete. Dealing with a financially stable company means the broker is less likely to rush proceedings or negotiations to close the deal quickly.
7. Have You Ever Worked With a Company in My Industry?
Each company and industry has specific needs. Finding a broker that can draw on experience in the same industry allows them to pull from that experience.
If the broker has never worked with a company of your type, are they capable of adapting and learning about your specific needs? A broker’s enthusiasm for helping you find the perfect property can supersede the need for prior experience.
8. Why Did You Decide to Sell Commercial Real Estate?
Why a person is selling commercial real estate provides insight into how they will likely perform their job. Someone who feels stuck in their position because they couldn’t find anything better will not put forth anything beyond the minimum effort.
Someone with compassion for helping others, who enjoys their position and has a strong desire to help people find the perfect commercial property, will approach their work enthusiastically. They are the broker that will go the extra mile to find you the ideal location.
Finding the Best Commercial Real Estate Broker
When looking for the best commercial real estate broker, select one who listens and desires to fulfill your needs. They need to understand commercial leases and the market. You will narrow down the field and make the correct choice by asking the right questions.
Get started selling or buying commercial property by contacting Commercial Orange County. We are a full-service commercial real estate broker.
Browse our selection of commercial property for sale or lease, then call (877) 775-9625 to find the perfect commercial property for your business.