Advice on buying Commercial Bldg, without broker, owner to occupy

[Kirsten Ostby]

Looking for some advice on how to handle a commercial real estate transaction with out the involvement of a broker. I'm looking at a few different buildings, and talking directly with the owners about purchasing. The main building I'm interested in has two spaces, one of which my future business would occupy, and the other space has a tenant in place with 4 yr lease remaining. 

I've started the process on a few things: 

financing: working on getting bank financing for the loan above my down payment, 

zoning: started the process of making sure my business would be allowed in the space. 

Lawyers: meeting with two lawyers next week. I'm wondering if having a lawyer to write up/review the real estate contract is one of the more important steps if I don't hire a broker? 

Building Inspector: I haven't started looking for one yet. Any tips on how to find a good one?

Request Lease for review: anything specific that I should be looking for with the current tenant's lease? 

Negotiating purchase price: The current tenant is paying $3200/month rent. Any tips on how I calculate what a fair offer range would be? The owner has started by asking $700k, and I'm thinking closer to 500k. 

What else am I missing? 

I'm familiar with the process of buying and selling Single family homes, but this will be my first commercial bldg transaction. Does anyone here locally have professional contacts you would recommend? 

Thanks!

Tags: Moore County, Southern Pines, Pinehurst, West End, Aberdeen, Raeford, Fayetteville, NC, Hoke County, Cumberland County, 

[Joel Owens]

Kirsten if the seller is SO FOCUSED on not paying a buyers broker commission for say 700k at 3% = 21,000 then WHY would they sell a property for 200k less than asking pricing? Just sayin....... : )

If your business occupies 50% of the space then some look at SBA loans.

Your situation has a lot of negatives to it for a broker anyways. Lot's of heavy lifting and low fees with headache and big use of time.

21,000 in commercial space is tiny. Your transaction has many layers of components to it that must be overcome. The commercial attorneys usually make 200's to 300's per hour so this is not the residential space. Plan on spending probably close to 10k on lawyer fees and maybe tens of thousands depending on how complex the transaction gets.

Good luck. No legal advice given.