All Forum Posts by: Taylor Hazard

What is the deal size? For institutional grade capital markets sales there is almost never a fee for Buyer's agent, I suspect that is not the case here however. 

I agree with @Vic Reddy, you should have disclosed the fact that your represented earlier or simply brought in your agent from the beginning. 

The listing agent may have been frustrated for any number of reasons, for example I will almost always offer a reduced commission to my clients if I am able to procure a Buyer (6% if outside broker involved or 4/5% of I find the Buyer). This incentives me to work harder while saving the client money etc. I also have weekly/monthly reporting calls with clients to discuss prospects and progress, if the listing agent disclosed you as a Buyer to his client and categorized it as a direct deal you have now put him in a tough spot with is client. If the Seller wanted too he could say "tough luck" and pay only the reduced fee. Remember the listing agent is beholden to his clients directives and may have his hands tied. You may find yourself in a situation with the Seller re-trading the deal.... "Price is $X, if he wants to bring in his agent this late then price is $X + buyers agent fee".

It may also be the case that the listing agent simply wants the full fee, who wouldnt right? Because your agent didnt source the deal or do any underwriting it would not be out of line to ask him to accept a reduced commission simply for transacting the deal. If one of my clients called me and said "I found a property, finished underwriting and want to submit an offer but you only get 1.5%" I would jump all over it. much of the heavy lifting has been done.

Something else to consider, if you value your agents input/involvement so highly it isn't out of the question for you to pay some or all of his/her fee (see above point on reduced commission). 

Lots of directions to take a response but one important piece will be to identify a property and sign a lease contingent upon closing. Financing will he WAYS easier if income is in place already (same for any construction loans if TI work is needed).

will also depend partly on which market, western Washington for the example has notoriously bad soils which would require far more scrutiny than somewhere like Colorado for example.

 No different than selling a building to a manufacturer. You as a listing agent represent a Seller, who may or may not have a building suitably zoned for plant husbandry (which varies greatly state-to-state); if you source a ready, willing and able Buyer who happens to grow or otherwise manufacture marijuana products what where are you exposed from a legal standpoint? so long as the Buyer is legally licensed under state, county and city guidelines you are fine. The "sticky" area from an insurance standpoint, if one exists, would only be present in a scenario where you the broker represents a Buyer or Tenant. 

What am I missing?

 Jen you raise some great points, the industry is going through the same growth curve as any other emergent industry. The first through the door blazed a path but set the market on price and saw increased higher margins but as the industry matured and more and more people entered the space competition is became rampant, production efficiency increased and price competition is now prevalent. 

In 2013 the whole sale price per pound of marijuana was $3,000 where as today its closer to $1,200. 

This, in my opinion, is a false narrative and this industry is here to stay. In this country we now have more states than not embracing medicinal and/or recreational marijuana. Again, trying to set aside personal opinions/beliefs nobody with even a semi-objective bone in the body would deny the benefits medicinally but more importantly there inst a state in our union that wouldn't welcome $200,000,000.00 a year in additional tax revenue (see Colorado 2016); total tax revenue from marijuana is expected to top $1B by 2020 in CO. Simply put there is too much money at stake. 

Leaders in Washington can wish and hope to turn the tide all they want but the train has left the station, personally I believe the we will revert back to Obama era policies of non-interference for law abiding business. Just an opinion. 

We, as RE professionals can limit exposure for ourselves and our clients by implementing prudent due diligence on tenants; by ensuring our tenants are properly licensed, operating within the law and keeping their operations to code the changes of the DEA / DOJ seizing assets is (in my opinion) next to zero. This is idea holds water when you consider that, like any industry, there are folks who are going to break the law and those operators will garner the attention of law enforcement. 

Obviously in terms of risk profile leasing to a marijuana tenant ranks relatively high, but is it any worse than the liability exposure if you have a tenant polluting your property for example? 

Having worked with both Landlords, Sellers, Buyers and Tenants in the Marijuana industry I love the question. Setting aside any personal biases towards the product the only people who negatively impacted by the industry (from a RE perspective) are traditional tenants competing for industrial space who are repeatedly priced out of space. Having done deals in the industry in multiple states I can say the net effect of pot is a reduced vacancy rate among second/third generation industrial properties nearing (or already) functional obsolescence. In Denver for example the Montbello sub-market which is typified by low clear, poorly loaded undesirable properties experienced a resurgence after amendment 64 was past. As an example there is/was an estimated 3,000,000 SF of industrial space occupied by marijuana users in Denver out of 300,000,000 SF total. 

In fact, throughout the Denver Metro area I could pick out 5 - 10 submarkets / neighborhoods / pockets of commercial space completely revitalized by the industry. Ruby Hill is one example as pointed out by @Account Closed

This is not to say there arent negatives, which there are plenty. For example growing pot is incredibly hard on buildings and properties with grow operations in them likely wont come back into circulation; more importantly until the banking issues are resolved and the industry is not forced to operate on a cash basis crime will always be an issue. 

Not to mention the fact that marijuana use in teens, DUIs, violent crimes and armed robbery have all declined in states that have legalized pot in some form or another...... not that were discussing the social ramifications.

I could continue to rattle off talking points but the TLDR is: depending on who you speak to the marijuana industry gets a bad wrap, in my humble opinion its nothing short of a windfall for states that have embraced it.... I'm very interested to see BP's thoughts on the subject. 

It's a tricky question and one best suited for a real estate attorney well versed in marijuana statutes. I would recommend Vicente Sederberg, LLP, even a quick google search will tell you what you need to know about their experience.

Agree with @Ronald Rohde

Generally you can use an attorney to draft the paperwork or just do it yourself online.