Contacting Buyers Agents to Sell My Prop Off Market

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Contacting Buyers Agents to Sell My Prop Off Market

Mike Nas
Member since 2020 · 7 posts · 0 votes

Dear BP family, I am looking for some advice in selling my MF property.

I am a multifamily investor in Southern California. I have 16 unit property I am considering perhaps selling and wanted to explore the option of selling it off market. I am not looking to find a listing broker at this time. My plan is to contact some brokers who recently bought/sold similar buildings in my area to ask them if they have a buyer who perhaps missed out or passed on the comparable property. 

For example "Hello Mr/Ms., I saw you recently [bought/sold] the property on X street. I own a similar building id consider selling and wanted to know if you have any clients who passed or missed out on the property that was sold and looking for something similar?"

There are not many of them so its not a lot of work, but is what I'm proposing reasonable? The buyers broker would of course get a commission for finding me a buyer who actually closes. I have a relative who is a retired broker who is willing to help me close the deal should I locate a buyer, but he wants me to do the legwork. I use to get a lot of calls in the past from people asking me if I wanted to sell my other buildings (doubt they were the actual buyers, more likely cold callers hired by investors). 

Is what I'm trying to do here reasonable or common in the industry? Would brokers scoff at the idea of presenting me with a buyer if they don't get the listing? Is the way Im phrasing what Im trying to do correct? Any other suggestions to sell this property off market? 

Thank you all very much in advance.

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Cory CarlsonBusiness Member
Real Estate Broker · OR · Member since 2018 · 311 posts · 226 votes
3y

You're limiting the number of eyes on the property by taking this approach. A broker is going to get it on Loopnet/CoStar, MLS, Crexi etc and be able to track inquiries and leads and draw a buzz on the property. Maybe this would have worked in 2021 but those days are gone.

Brokers will not necessarily scoff at the idea of presenting you a buyer but your pool is going to be awfully low reaching out to the first dozen or so you can think of. 

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  • Cory CarlsonBusiness Member
    Real Estate Broker · OR · Member since 2018 · 311 posts · 226 votes
    3y

    You're limiting the number of eyes on the property by taking this approach. A broker is going to get it on Loopnet/CoStar, MLS, Crexi etc and be able to track inquiries and leads and draw a buzz on the property. Maybe this would have worked in 2021 but those days are gone.

    Brokers will not necessarily scoff at the idea of presenting you a buyer but your pool is going to be awfully low reaching out to the first dozen or so you can think of. 

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  • Bruce Lynn
    Real Estate Broker · Coppell, TX · Member since 2011 · 5k+ posts · 4k+ votes
    3y

    I guess it depends on what kind of price you want for the property.  Off market deals are likely to sell for significantly less than On market deals.   Off market buyers are looking for bargins and discounts.

    Often I use the example of cars.....private sales are usually lower than car lot or big dealer sales.   Why is that?  Market is smaller for the private sales, vs big dealer sales. More exposure on the bid dealer lots.  They have more access to customers, more advertising, more traffic.

    Giving it to the right broker will likely generate a higher sales price for you....more tours, more offers, more people left in the second round for highest and best.   I think a good broker, especially in multifamily or commercial will help you put together the right numbers and marketing package to maximize your sale.

    On the retail side of things...so for personal single family homes think of it this way. We don't really see a lot of FSBOs any more, but a few years ago when we would drive people around on a home tour viewing 5-10 homes on a Saturday, when the buyer would see the FSBO sign they would be so excited. There's a bargin. The seller thinks they are saving a 6% realtor fee, although like you they would potentially only be saving 1/2 that if they are willing to pay the buyer agent fee. However the buyer is thinking "bargain" I'll save like 10% on that house. Those deals rarely worked out as the seller and the buyer were just thinking 2 different numbers, but at one point plenty of people wanted to try it.

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  • Erik EstradaBusiness Member
    Lender · Member since 2022 · 6k+ posts · 1k+ votes
    3y
    Quote from @Mike Nas:

    Dear BP family, I am looking for some advice in selling my MF property.

    I am a multifamily investor in Southern California. I have 16 unit property I am considering perhaps selling and wanted to explore the option of selling it off market. I am not looking to find a listing broker at this time. My plan is to contact some brokers who recently bought/sold similar buildings in my area to ask them if they have a buyer who perhaps missed out or passed on the comparable property. 

    For example "Hello Mr/Ms., I saw you recently [bought/sold] the property on X street. I own a similar building id consider selling and wanted to know if you have any clients who passed or missed out on the property that was sold and looking for something similar?"

    There are not many of them so its not a lot of work, but is what I'm proposing reasonable? The buyers broker would of course get a commission for finding me a buyer who actually closes. I have a relative who is a retired broker who is willing to help me close the deal should I locate a buyer, but he wants me to do the legwork. I use to get a lot of calls in the past from people asking me if I wanted to sell my other buildings (doubt they were the actual buyers, more likely cold callers hired by investors). 

    Is what I'm trying to do here reasonable or common in the industry? Would brokers scoff at the idea of presenting me with a buyer if they don't get the listing? Is the way Im phrasing what Im trying to do correct? Any other suggestions to sell this property off market? 

    Thank you all very much in advance.


     I am curious to know why you would like to go this route? Seems like a lot more work calling up a bunch of brokers to see if they have a buyer than putting it up on the market and see which buyer is qualified to close. 

    A good listing broker will have a good understanding of financing and if a buyer is able to perform. 

    With that being said, if the deal makes sense, I might have a few contacts that are interested. Happy to connect. 

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  • Mike Nas
    OP
    Member since 2020 · 7 posts · 0 votes
    3y

    Thank you to all who have responded. I know its harder trying to sell off market since the buyer pool is so small. The property is somewhat unique for the area given its characteristics (i.e. 80s built, washer/dryer hookups in unit, balconies, high ceilings, stabilized cash flow with room for increases, has some assumable debt at a good rate) so I think a legitimately active buyer would at least consider it.

    There are only a few brokers, maybe 5-10 brokers, in the area who have worked similar deals recently so its really not much work checking with them first for any "low hanging" buyers. 

    As for why I want to go this route, Im not in any rush to sell but would be willing to accept a fair offer and this is a way to test the market. I worry about listing it in case Im not able to get a satisfactory offer for it in this market and have to take it down which some buyers may not look at favorably down the line. Also sometimes listing the building for sale can stir up the tenants and things have been great so I would prefer not to rock that boat if I don't need to. 

    ps. It seem a lot of these MF deals around here offer each broker about 1.5% or 2%. Some of the smaller buildings offer 2.5% but not very often. To incentivize the buyers agent here I would offer the buyers agent a little more $$$ off market than I would be if I listed it. Perhaps 2.0% if sold off market, 1.5% if I list it.

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  • Peter MckernanBusiness Member
    Residential Real Estate Agent · Irvine, CA · Member since 2013 · 2k+ posts · 1k+ votes
    3y
    Quote from @Mike Nas:

    Dear BP family, I am looking for some advice in selling my MF property.

    I am a multifamily investor in Southern California. I have 16 unit property I am considering perhaps selling and wanted to explore the option of selling it off market. I am not looking to find a listing broker at this time. My plan is to contact some brokers who recently bought/sold similar buildings in my area to ask them if they have a buyer who perhaps missed out or passed on the comparable property. 

    For example "Hello Mr/Ms., I saw you recently [bought/sold] the property on X street. I own a similar building id consider selling and wanted to know if you have any clients who passed or missed out on the property that was sold and looking for something similar?"

    There are not many of them so its not a lot of work, but is what I'm proposing reasonable? The buyers broker would of course get a commission for finding me a buyer who actually closes. I have a relative who is a retired broker who is willing to help me close the deal should I locate a buyer, but he wants me to do the legwork. I use to get a lot of calls in the past from people asking me if I wanted to sell my other buildings (doubt they were the actual buyers, more likely cold callers hired by investors). 

    Is what I'm trying to do here reasonable or common in the industry? Would brokers scoff at the idea of presenting me with a buyer if they don't get the listing? Is the way Im phrasing what Im trying to do correct? Any other suggestions to sell this property off market? 

    Thank you all very much in advance.


     You are limited to the number of eyes on the property, I would open it up to as many broker's as you can to make their awareness grow and get their clients in the mix to get an offer. I would try that and I would look for any broker that has not only sold that type of property in that city, but brokers that sell in that county. For instance, Inland Empire, find all that have done a deal like that in the past 5 years, then shoot it out to them on an email blast! That's what I would do, and then follow up with a phone call. Add the numbers etc. put your proforma together and send that with the deal so they can shop their buyers. Most players as a broker are in the mix with a lot of buyers. 

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  • Demetri Newson-Thompson
    Member since 2023 · 1 post · 0 votes
    3y

    The more brokers you have involved the more eyes on the property... the more likely you will get top dollar and more likely you will have back up offers.

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