Buyers agent - commercial property

I've spoken to a few commercial property agents, and they actually all sound great, which is making it hard to pick one to engage. Fees vary quite a bit too. Ie lower acquisition price it's all around the same, but some scale on property value, some don't. So if someone (for example) purchased a $10m property the fee varies as much as $100k

Fee isn't everything, but are you best to engage a commercial agent from the state you are interested in buying into?

I don't really care on the state of purchase, more the fundamentals, but it appears that Sydney and Melbourne have lower yields than Perth and Brisbane.

Another issue I see is there is very limited stock at the moment and I'm sure some buyers agents have a long list of pre-approved clients.

I'd appreciate any views from those that have experience in using a buyer's agent, or thoughts on where we are in the commercial property cycle. I'm guessing we are at the peak.

 

Best to have a well connected buyers agent because understandably the relationship is personal, and what differentiates them is their research game, because ultimately, no one is buying local anymore.

Happy to introduce you to the ones that I use.

 

I used Scott at ReThink Investing. He sourced me a great property off market. Patience is the key of course in this market, they are very busy with a lot of clients and not enough properties. A follow up call/ email every 2 weeks to them prob doesn’t do any harm either. My advice is to be pre approved and good to go for when they send you a suitable property and you can ask a lot of your questions during the due diligence period. Would I use them again, yes. He is based in Sydney and the property is in SE Qld so purchased sight unseen (still haven’t seen it) but Scott organised agent to take photos and videos and building inspector took photos as well all during due diligence. Of course time will tell but they and the property ticked a lot of boxes.

 

The BA should hold a real-estate licence in the state where they are buying.

 

As a commercial agent I wouldn't bother with a commercial buyers agent but definitely get a mortgage broker that knows commercial property finance and a commercial property solicitor. Not the 'Jack of all Trades' solicitor/conveyancer down the road.

 

Shady, why wouldn’t you bother with a BA?

 

I wonder as well because I feel the due diligence conducted on a commercial property needs to be more in-depth and careful than a residential property. I feel there are many more moving parts involved.

 

Why?

 

It's mandated by the Property Stock Business Agents Act (NSW).

 

Yes, correct. Many agents I know are only too happy working with a BA.

 

Have you chosen one yet? I'm in a similar situation. I've got my deposit ready and looking for a BA to source a commercial property this year if possible. I've contacted Rethink Investing (which appear to be one of the top BAs in the commercial space) but they are not taking on new clients until next month and I haven't heard from them in two weeks so no doubt they are not short on business atm. Do you know of any good BAs that operate in QLD?

 

I suppose what you may have to weigh at your end is speed vs quality. There's a reason all comm BA are busy at the moment, commercial property investing has experienced its own mini boom so the demand has been huge.

 

Too busy to respond to enquiries but certainly not too busy to keep drumming up their BA businesses on every podcast under the sun like Mr Rethink lol. Quality is king so I'll take my time and probably try to find another party or two to target a property in the 1.5-2mil range.

 

Scott’s a good guy. But his stuff is mainly smaller stuff like strata sheds. Good yield , not much capital upside imo.

To me you may as well buy REITs or invest in syndicates and get the same yield without headaches and much more liquidity.

the big money in commercial is buying large land value properties and repositioning leases… this has an entry price of $4-5m and hence can consider JV this with others… u need a 35-40% deposit

industrial is going gangbusters and there is a lot of runway for rental growth ($100/m) and land values ($300/m) in Brisbane. If you can acquire a good land holding with a decent structure that generates income it’s a no brainer for me

 

You probably don't need to aim at $4m to $5m pa net rental .

Over $1m + pa rental properties and you get the large land holdings and large buildings.
Just avoid strata.

You are certainly right industrial has gone crazy .So far this year my industrial rentals have gone up $28k pm.

Its a great time for landlords

 

thanks for that, some food for thought there

 

Hi steve

can I ask what sort of building it is? Industrial etc?

 

Hi @Zdravko
If you are looking for an excellent buyers agent in QLD. Then I highly recommend Mish Daniel from Revolve Commercial. I have interviewed her a few times and she is a top operator.

Revolve Commercial | Commercial Buyers Agent | Brisbane & Gold Coast

 

It is strata industrial, warehouse.

 

thanks for the suggestion Andrew, I'll be sure to reach out