The Ultimate Buyer's Checklist

Buying commercial real estate can be a long lengthy process if you've never done it before. 

It's one thing to buy a residential property but it's a whole other world to do deals in commercial real estate. If someone ever tells you that residential and commercial deals are the same... don't listen to them. They are anything but similar. 

If you're new and just getting into investing into commercial real estate or need a refresher, you want to make sure all the boxes get check off and everything is done right. 

Having this simple checklist can be the difference of whether you make it or break it.

1.Compare Commercial Properties in the Area - You can easily review multiple properties, pricing, and what your target property looks like with a commercial broker. Somethings you should also look for and consider:

-Does this area support the rent you need to make a deal work?

-Is there a lot of competition for rent in the area? Will you be able to set your property apart?

-Is there a high vacancy rate in the area you want to purchase?

-If you find that the area can't support the rent you need to make the deal work, is there something about the property that can set you apart that will allow you to achieve better rates?

2.Educate yourself on terms and processes - Brushing up on some knowledge as to how commercial real estate works will better help you as a buyer. Knowing some of the terminology and process will make everything go smoother and you will be able to keep up with what's actually going on while purchasing a property. 

3.Do the math - Running numbers will help you understand as an investor as to how much everything will cost to keep the lights on and how much you will need to charge for rent. Your numbers should allow you to see how much income you will be making and how much will go back into running the property. 

4.Build a network - building a network will only help you in the long run. Who's in your network truly shows your net worth.  Consultants to consider adding to your network:

-Mentor/Advisor

-General Contractor

-Commercial Real Estate Broker

-Commercial Real Estate Attorney

-Property Manager

-Architect 

-Engineer

-Surveyors 

If you are starting with a commercial broker, they should be able to help add some of the rest of the consultants to your network for you. 

5.Figure out financing - first and foremost research and interview with multiple lends at multiple banks. You want to find the right deal with the right terms for you. If something feels off about an offer, don't take the offer, get back to interviewing. 

Once choosing a lender, you will want to meet multiple times to go over the purchasing process and make sure that your lending partners are truly interested in lending to you. You will also want to build a relationship with you lender because they will be vouching for you with your loan committee.

6. Compile all of your paperwork - Making sure that you have all your documentation ready for the sale will help move the sale along quicker. You commercial broker will help you with a list of necessary documents you will need. Make sure that you are keeping all documents in one specific place where you can easily find and that you have a couple of copies so that if something is misplaced you have a back up. 

Now that you’ve read through the checklist, and you’re feeling a bit... overwhelmed. Know that commercial real estate takes a ton of work and effort. 

If you are wanting to get started with this journey but thinking you’re going to need some help. Why not let me help you with this process. 

501.993.1973 | cassie@cassiewells.com | Cassiewells.com