As a court appointed receiver, you’re no stranger to occupying the middle ground between disputing parties. The underlying litigious nature of receivership matters puts each assignment under the microscope for rigorous inspection. From the presiding judge to the lender’s asset manager and attorney to the borrower and borrower’s counsel, receivers are under enormous scrutiny.
Fortunately, with the advancements in commercial real estate technology, receivers are gaining access to enhanced transparency, greater efficiency and the means to better protect their interests. Over the past 15 years, CRE sales and marketing technologies have fundamentally shifted the way properties and portfolios are marketed and sold. Investment sales brokers, equipped with the right technology, can now show full due diligence of the entire sales and marketing effort. From property marketing to due diligence to bid management to close, brokers are able to offer a level of performance and transparency like never before.
While the majority of brokers are accustomed to everyday technology, such as email and the internet, only an elite subset has mastered the art and science of the digital disposition. Hiring the wrong broker can negatively impact sales proceeds and extend the life of operating expenses, so your ability to decipher between common and elite capabilities during the selection process is critical. Below are a handful of questions to help you determine whether or not a broker is properly leveraging technology to ensure that each assignment yields the greatest price, execution and transparency.
1. How Do You Show Full Due Diligence in the Marketing of an Asset?
The commercial real estate transaction process has undergone substantial changes in recent years. What was once an analog process is now predominately executed online. While the digital medium promises abundant transparency, it also introduces complexities that surpass the individual expertise of the majority of brokers. Defining a marketing plan that clarifies “best efforts” and achieves investment goals is often a source of contention and confusion when a contract is being negotiated. It can also be a source of dispute after the contract has been signed because parties opposing the sale may scrutinize the marketing effort in an attempt to make the case that the broker is not using his or her best efforts.
Elite Brokers know their technological limitations and are not afraid to pay a premium to provide clients the critical information they require. Real Capital Markets’ real-time analytics and custom reports span the entire investment sales and marketing process to provide valuable insight for determining the most engaged buyers by tracking who opened emails, viewed the executive summary, executed confidentiality agreements, downloaded documents, submitted offers, and more. Brokers also have access to buyer resumes and qualifications to help finalize the offer selection process, as well as offering report cards to satisfy regulatory requirements.
2. Do You Have Access to a Substantial Buyer Database?
Shhhh… this is meant to be a trick question designed to determine the quality, not the enormousness, of a broker’s buyer database. Be wary of sales professionals that rely solely on the enormity of their database to validate their ability to successfully market an asset. In other words, the size of their list is irrelevant if the data is inaccurate or incomplete.
Elite Brokers leverage their buyer database to craft a highly targeted marketing effort that pinpoints the most relevant pool of serious investors based on the prospective buyers’ highly-personalized investment criteria, geography, asset type, asset class, price range, etc. This extremely targeted method of marketing dramatically increases buyer participation, results in more offers, and ensures maximum sale prices.
3. How Do You Maintain the Accuracy of Your Buyer Database?
One of the toughest challenges that brokers face is building and maintaining a database of active buyers. With roughly one quarter of their database becoming obsolete each year, their ability to properly maintain their list becomes a critical component to the success of each transaction.
Maintaining a healthy and active database capable of targeting the most relevant pool of qualified global buyers requires significant time and effort. Surprisingly, the majority of brokers fail to adequately maintain their database, resulting in less than optimal property exposure. Be mindful that the majority of brokers do acknowledge the importance of accurate buyer information; however it’s rare that they fully comprehend the inaccuracy of their own data.
Elite Brokers understand that a well-maintained buyer database is one of the most critical components to ensuring maximum pricing. They invest in the resources, human or otherwise, to properly manage their investor data. A large percentage of top institutional brokers supplement their database with the highly refined third-party Qualified Buyer Database provided by Real Capital Markets.
Real Capital Markets is the global marketplace for buying and selling commercial real estate. RCM’s solutions streamline the entire commercial real estate sales and marketing process for buyers, sellers, and brokers. From property marketing and due diligence, to bidding and closing, RCM increases the speed, exposure, and security of property and notes sales.
To date, the Company has executed more than 37,000 assignments with total consideration in excess of $1.5 trillion. Approximately 1/3 of all U.S. commercial assets sold, over $10 million, are brought to market using Real Capital Markets’ online marketplace.