With the evolution of Perth’s commercial real estate landscape and an increase in private and SMSF investors eyeing commercial assets, the demand for commercial property buyer’s agents is rising. These professionals, skilled in sales and asset acquisition, can provide crucial insights and support in navigating the highly competitive and complex market.
Let’s delve into the reasons for the growing popularity of commercial property buyer’s agents in Perth.
Why Perth’s Market is Buzzing About Commercial Property Buyers Agents
It’s no secret that Perth’s commercial real estate investment scene is vibrant, drawing attention from a broad spectrum of investors. Assets soaring in popularity include industrial warehouses, childcare assets, medical/consulting, fast food, service stations and to an extent retail and office spaces.
In June 2023 the Financial Review reported industrial rents were up on average 24.9 per cent over the past 12 months. Research conducted by CBRE also showed Perth has one of the lowest industrial vacancy rates in Australia at 0.4 per cent. Both factors have created a perfect storm for investors wanting to claim their slice of the pie.
Given the keen competition, limited commercial investment properties available and a decrease in new builds post COVID, having a seasoned professional at your side could be appealing.
The advantages of partnering with a commercial property buyers agent
Expertise on Tap
Commercial property buyer’s agents live and breathe property purchasing. They bring a wealth of knowledge about commercial real estate property investing and management, industry trends, and insights that the average investor may overlook. Commercial investing can be more complex than residential and having experience and expertise on your side may prove invaluable when it comes to thorough diligence and deal structure, and settlement.
Time Saving
Searching for the ideal property in a soaring market, particularly in hot sectors, can be time-consuming. Buyer’s agents can expedite this process by doing the legwork, ensuring investors are presented with properties that meet their criteria.
Access to Off-Market Deals:
Some of the best commercial building property deals never make it to public listings. Well-connected buyer’s agents often have networks with commercial property managers and sales and leasing agents, granting them access to exclusive off-market opportunities.
Due Diligence
No two commercial properties are identical. A buyer’s agent can assist with comprehensive due diligence on both the property and its tenant.
For example, if a commercial property is tenanted, a buyer’s agent should assess whether the current rental rate aligns with the market standard for similar assets, whether there is opportunity to improve and how this may impact the sale price. They may evaluate arrangements like a lease-back proposal if the seller’s business occupies the property, ensuring the lease terms are standard and legally vetted. They can also identify tenant-owned items pre-sale to prevent future ownership disputes.
And we’re really only scratching the surface here. The thorough due diligence a buyer’s agent can provide can significantly save buyers both time and money in the long run.
Negotiation
Having an objective third party negotiate on your behalf can offer notable advantages, especially in a hot market where investors aim to ride the wave. A buyer’s agent can tailor advice to current market conditions, altering negotiation strategies between rising and declining markets. They can help secure the property on terms favourable to you, aligning with your overall investment strategy.
Deal completion
Negotiating up to a contract is one thing. Reaching a successful settlement post-negotiation can be a whole other story. Numerous potential hurdles could include due diligence findings, financing issues, incomplete documentation and unresolved property maintenance.
Last-minute course corrections, especially in high-pressure, high-stakes situations involving multiple parties, require adept handling. Having experienced assistance from a commercial property buyers agent on your side could significantly ease navigation through these challenges towards a satisfactory settlement.
This all sounds great, so what are the risks?
The rising demand for commercial property buyer’s agents in Perth has expanded available service offerings. However, many are from interstate agencies. The risk here is that they may lack the deep local market understanding that active, local commercial property management firms possess.
A local agent’s ability to conduct real-time, in-person inspections is invaluable. They can identify issues often missed or impossible to identify in online adverts or Google searches.
For example in a strata complex, they could assess the condition of common areas not shown in listings. They could also gauge the impact of neighbouring tenants. Perhaps there is a mechanic using all the car bays or a food manufacturer with an odour that wafts through the property all day. They can also play an important role in assessing the general property condition. Verifying if the issues noted during building inspections have been addressed satisfactorily before settlement
These kinds of insights are difficult to obtain without boots on the ground.
Is a commercial property buyers agent right for you?
If you’re keen on delving into commercial or industrial property investment and management, feel free to reach out. While Perth Commercial Property doesn’t currently offer buyer’s agent services, we do provide pre-purchase inspections to buyers looking to appoint a dependable commercial property management agent for newly acquired assets.