As the demand for commercial properties grows, an increasing number of sellers aren’t listing them on traditional directories such as the MLS or CLS, say veteran investors. Instead, they’re opting for listing them with independent brokerages, inclined to keep those fast-moving properties exclusive to their own sites and in hopes of earning commission on both ends of the transaction.
“There’s such demand for multi-residential units these days that these properties practically sell themselves,” says investor Paul Kandakos, witnessing an increase in the number of sellers opting for private listings. “It’s always been a tactic, but it’s becoming more prevalent because these properties are in such high demand.”
It means that investors relying solely on their Real estate agents to connect them to investment opportunities in the commercial sector may be missing out on valuable opportunities, says Kandakos.
“Typically you would look on the MLS or CLS to find these commercial properties, but what you’re not aware of is that a bunch of independent brokerages are listing these as well," he tells CREW online. "So these are properties that investors aren’t even aware are on the market.”
There are, in fact, entire agencies set up to list “confidential” real estate for sale, popular fixture for sectors such as hospitality where even the hint of a building being put on the market could hurt business and worry existing tenants.
So what are the investor benefits to private listings?
As an investor selling a commercial property, you skip paying commission to both a selling and buying agent.
That makes it easier to negotiate a reduced rate with the one real estate agent handling both ends of the deal. Still, other sellers prefer to list on their own sites, do a bit of advertising and keep the commission to themselves, knowing the property will sell without a prolonged listing. For an investor looking to buy a commercial property, Kandakos notes that knowing is half the battle. Looking beyond conventional listing sites will give savvy investors the competitive edge, he says.
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