Feb. 25, 2026
How to Buy Your First Commercial Property in 2026 (Financing, Underwriting & LOIs Explained)
In this solo episode of Commercial Real Estate Secrets, Aviva Sonenreich, Managing Broker of Warehouse Hotline in Denver, Colorado, breaks down exactly how to buy commercial property in 2026 — from financing and underwriting to listing platforms and negotiating LOIs.
You’ll learn how to prepare properly, avoid rookie mistakes, and position yourself to move fast when the right deal hits the market.
If you’re considering buying your first commercial building, this episode gives you a practical roadmap to commercial real estate investing in 2026 and beyond.
Key Topics Discussed
- Why commercial real estate is not crashing — and what’s actually happening in the 2026 market
- Why financing comes first (and what lenders or partners need from you)
- Different ways to fund a deal: commercial loans, partners, and OPM (other people’s money)
- How to choose the right property type (industrial, retail, office, multifamily, hospitality)
- Why buyers must learn to underwrite their own deals
- The difference between LoopNet, Crexi, and CoStar
- Why off-market deals are not always better deals
- Who pays the broker in commercial real estate transactions
- What an LOI (Letter of Intent) is — and why it comes before the Purchase & Sale Agreement
- The due diligence process after going under contract
Platforms Mentioned
- LoopNet, Crexi, CoStar
Understanding how these commercial real estate listing platforms work is critical when buying commercial property in Denver, Colorado or nationally.
Who This Episode Is For
- First-time commercial real estate buyers
- Investors looking to enter the industrial or warehouse market
- Business owners considering buying instead of leasing
- Buyers confused about underwriting and financing
- Anyone searching “How to buy commercial real estate in 2026”
About the Host
Aviva Sonenreich is the Managing Broker of Warehouse Hotline, a Denver-based commercial real estate brokerage specializing in industrial properties, warehouses, land, and investment sales throughout Colorado. She is also the host of Commercial Real Estate Secrets, where she breaks down practical, real-world commercial real estate strategies for investors, owners, and brokers.
Save This Episode
Thinking about buying commercial property this year?
Save this episode so you can reference the step-by-step process before submitting your first LOI.
And if you’re buying in Denver or anywhere in Colorado, reach out to the Warehouse Hotline for guidance on industrial and commercial acquisitions.
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We have identified 123 Main St.
it underwrites, we have our
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money in order, we have our PSA
signed, we're under contract,
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we're doing our due diligence,
we're working with a broker and
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hopefully an attorney and we're
marching towards a close.
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Congratulations, you are now on
your way to buying your first
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commercial property.
OK, I'm going to start that
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over.
Let's talk about buying
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commercial real estate for
dummies.
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First question that comes up,
well, isn't commercial real
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estate crashing?
Well, my friends, it's not.
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If it was, I'll be happy because
then we could buy even more and
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help our clients buy even more.
But the reality is it's
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commercial real estate is not
crashing, right.
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You may have turned on the news
this week and you saw that Eddie
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Bauer and Francesca's are
closing 600 stores.
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And yes, that's alarming, but
you have to understand the way
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that we are consuming product
and interaction and everything
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in between is facilitated by
commercial real estate.
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So while these Eddie Bauer
stores may be closing, right,
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people are not buying camping
supplies in retail stores
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anymore.
These stores are being
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backfilled by pickleball
concepts and new age retail
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concepts faster than you can say
the only four letter word in
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commercial real estate, which is
vacancy.
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All of that to say, while the
media might be spewing lies
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about commercial real estate,
the market is not crashing.
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There has certainly been a
rebound from 2021-2022 and we
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talk about that in other videos.
Interest rates low, prices high.
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However, in this episode, we are
also going to be answering your
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biggest questions when it comes
to buying commercial property.
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What are the listing services?
What are the steps?
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What am I even buying and how do
I underwrite it?
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I'm very, very excited to chat
so let's dig in.
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You know, I walked into my
office last week and I said Jen
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to my office manager, I saw this
warehouse priced at 120 bucks a
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foot and she said Aviva, it's
buying season.
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And she's not wrong.
We are seeing prices coming down
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in a serious way and this might
be the best opportunity ever to
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buy commercial real estate.
So I want to get into my 2 top
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tips for buying commercial real
estate as they pertain to
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getting a deal done.
Tip #1 You have to get your
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financing in order first.
Out of respect for your time.
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Out of respect for my time, your
partner, your spouses, your
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parents, your kids.
Out of respect for their time.
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You need to understand where the
money's coming from.
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What does that mean?
One talk to a commercial lender.
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See what you need in order to
get a building with a loan or
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you need to talk to your
partners.
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Maybe you're raising OPMOPM
stands for Other People's Money
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to buy commercial property, and
that's an amazing Ave. to do so.
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However, in order to buy
commercial real estate, before
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you start your showings, before
you start offers, you need to
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know where the money is coming
from and how you plan to finance
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it.
Now that you've got your
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financing order tip #2 is to
pick a product.
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What does that mean?
I thought we were buying
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commercial real estate.
I thought you would never ask.
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Commercial real estate is an
umbrella term where then there
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are many, many different product
types that you probably never
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would have even thought that
you've consumed or walked into
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under the umbrella of commercial
real estate.
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This could be retail.
This could be medical office,
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this could be multifamily or
hospitality, or industrial.
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In order to buy a commercial
asset, you need to know what
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you're buying and why.
For example, here at the
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Warehouse Hotline, we only
transact industrial properties,
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industrial land, and a little
bit of retail.
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The reason you need to pick your
product prior to searching is
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because you need to know how to
underwrite these properties
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before you start your search and
you do not not want to have to
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rely on a broker, the listing
agents broker, or even your own
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broker to underwrite that deal
for you.
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Why?
The reason you can't just let
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your broker underwrite the deal
is because there are, believe it
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or not, scenarios where brokers
mess up and when the deal closes
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and you have now underwritten
the property based on the
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brokers numbers, that may be
incorrect.
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At the end of the day, if you
have bought the property, you
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signed on the dotted line, it's
your issue.
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It's no longer the brokers
issue.
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So while brokers are amazing to
help facilitate deals,
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underwriting needs to come from
you.
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Due diligence needs to come from
you, right?
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The buck stops with the buyer
because at the end of the day
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when the deal is closed, the
buyer is the person handling the
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property.
So very important to do all of
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your own due diligence.
Step #2 for buying a commercial
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property is to pick your product
and start practicing.
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Practice underwriting a multi
tenant triple net warehouse.
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If you don't know what triple
net means, I've got a video
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about it.
But also we have amazing
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resources online.
Chachi PT Google that literally
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five years ago.
We're not options.
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So in order to get a deal done,
you need to sharpen your pencil,
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figure out what you're buying
and how to underwrite it so that
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when we start touring and we
start looking at these
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properties, you are able to move
fast.
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Now you might be saying to
yourself, where am I finding
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these properties where I can
learn how to underwrite?
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And I thought you'd never ask.
There's a a really interesting
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commercial real estate ISM out
there and it's the listing
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services.
So the question is, what are the
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commercial real estate listing
services?
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How can I go shopping for a
street buyer?
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What's that mean for a
commercial buyer?
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There are many various listing
sites for commercial real
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estate.
Some are accessible to the
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general public, some are not.
You as a buyer want to be making
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sure that you're looking at all
of your options.
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So you will start by going on to
Loopnet and Craxie, which are
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options open to the general
public where you can start
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looking at properties,
practicing underwriting, getting
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numbers, etcetera.
Now you will also be hiring a
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broker because the broker will
have access to Costar.
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Costar is the main database
nationally where brokers post
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their commercial real estate
listings.
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Costar is really expensive, so
the general public doesn't have
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Costar subscriptions.
However, Costar owns Loopnet.
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So you're asking yourself, I
thought you just said we don't
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have access to Costar, but then
we have Loopnet and what's the
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difference?
Good question.
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The properties you see on
Loopnet are paid for by either
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the seller or the broker to get
more exposure from Costar.
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So what that looks like is I go
into Costar and I set up and pay
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extra for your property to be
seen on Loopnet.
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Not all properties that are
brought to the market are put on
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Loopnet.
That's why you need a broker to
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help you discover the properties
that are not paid extra for in
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order to get that visibility.
Now, there's a misconception
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that properties on Loopnet are
bad.
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That is not true.
I've seen amazing deals on
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Loopnet and I've seen buyers buy
amazing deals on Loopnet and two
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buyers want off market deals.
Why?
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I understand right?
It's a element of wanting what
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you can't have.
However, as someone who sells
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buildings for a living, the way
that I see buyers get the best
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deals are not buying off market
deals, but rather buying deals
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that have sat on the market for
a while.
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So for whatever reason, the
seller is fatigued and in that
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case more likely to give you a
better deal on a property as
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opposed to a seller who doesn't
even want to sell in the first
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place and you have an off market
deal.
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So a few misconceptions about
buying property and the listing
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services.
There are good deals to be had
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on Loopnet and just because a
deal is off market doesn't make
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it better to the average buyer.
To recap, the commercial real
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estate listing sites that you as
the general public ought to be
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shopping and consuming on are
Loopnet and Krexi.
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Then you also want to make sure
that your broker is pulling
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properties from costar to see
the properties that the general
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public does not have access to.
This is going to give you the
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most comprehensive understanding
of the properties available for
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sale in the market of your
choosing.
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All right, so we've got our
money, we know our product type,
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but the question arises, who
pays the broker?
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And I thought you'd never ask.
When a property goes on the
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market, generally speaking, the
listing agent and the seller
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agree to a Commission that will
then be split by the listing
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agent and the buyer agent at
closing.
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So generally the seller pays the
Commission for the listing agent
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as well as the buyer broker.
Now, in an off market scenario,
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generally the buyer will pay the
buyer broker the Commission.
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Here's the fun part,
Everything's negotiable.
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That said, if you're looking to
sell a commercial property, you
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should pay your fees because
what the fuck bro?
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I have been in scenarios where
I'm the listing agent and the
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buyer broker goes I don't want a
broker, we'll just take 3% off
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the price.
Well Mr. Buyer, unfortunately
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that's not an option.
You see the seller and the
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listing agent agree to a price
before the property even goes on
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the market.
So say it's a 6% Commission.
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The seller is already going to
pay the 6% Commission.
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They have signed on the dotted
line and they're already
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underwriting the 6% out of the
final amount.
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Now the buyer is going to come
in and they are either going to
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not have representation in which
then the listing agent will get
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the full 6% Commission, or the
buyer broker can find a broker,
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have someone have their
fiduciary duty to the buyer, and
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it doesn't actually change the
outcome for the seller.
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There's that misconception of,
well, if I come in without a
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broker, I'll get a better deal.
That's not reality and I
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strongly advise against doing
so.
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Remember, if a property's on the
market, a fee has already been
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delineated and you can ask what
the fee is and how that pertains
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to your deal.
All of that to say, we strongly
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suggest having a broker so you
have someone with your fiduciary
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duty and best interest in mind.
Specifically if you're buying a
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property because it doesn't even
cost you anything.
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Be smart, don't be cheap.
All righty.
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So we've got our financing,
we've got our property type,
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we've got our broker, and we've
been practicing underwriting.
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Now let's go shopping.
We're hitting the streets, we're
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previewing properties, we show
up to 123 Main St. we fall in
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love with it and we're ready to
buy it.
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So now what's the next step?
We have two options.
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We're either submitting ALOI,
which stands for Letter of
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Intent or APSA Purchase and Sale
Agreement. 99% of the time we
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will draft up an LOI first.
An LOI is essentially a one or
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two page document that is a high
level representation of the deal
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points, price, due diligence,
time frames, expectations.
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If the buyer and the seller can
agree to the terms on the 2,
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three page document of the LOI,
then we will move to the
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purchase and sale agreement,
which is the real deal, right?
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So there's a lot of legalese,
but all of it to say if we can
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agree on the LOI, then we can
agree on the PSA as opposed to
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writing up a 25 page purchase
and sale agreement.
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And we're fighting over purchase
price.
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We could have saved all that
time with just an LOI.
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So have your broker write up a
letter of intent to begin your
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negotiations with the seller.
All righty, the LOI has been
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00:12:20,360 --> 00:12:23,400
agreed upon, now we're on to the
purchase and sale agreement.
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00:12:23,760 --> 00:12:27,000
Once the purchase and sale
agreement has been agreed upon
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00:12:27,000 --> 00:12:30,320
and side by both parties, mazel
tov.
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00:12:30,320 --> 00:12:33,600
You're under contract, and once
you're under contract, that
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00:12:33,600 --> 00:12:38,120
means the buyer has X amount of
days to perform their due
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00:12:38,120 --> 00:12:41,920
diligence, get their money in
order, and buy the building.
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00:12:41,960 --> 00:12:45,840
And once a seller is under
contract, they cannot back out
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00:12:45,840 --> 00:12:47,960
of the deal.
I mean, you can, but then you
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00:12:47,960 --> 00:12:49,640
get sued for specific
performance.
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00:12:49,680 --> 00:12:53,240
It's a bad idea.
We're avoiding lawsuits here in
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00:12:53,240 --> 00:12:54,920
order to buy commercial real
estate.
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00:12:55,160 --> 00:12:58,000
Preparation prevails over
everything.
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00:12:58,160 --> 00:13:00,120
You need to be prepared to get a
deal done.
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00:13:00,200 --> 00:13:03,440
There are people who you can
hire to get in your court to
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00:13:03,440 --> 00:13:06,520
make sure you get the
preparation done, be it
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00:13:06,520 --> 00:13:10,080
attorneys, brokers, people to
help with due diligence,
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00:13:10,080 --> 00:13:12,760
etcetera.
However, at the end of the day,
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00:13:12,760 --> 00:13:16,800
you, Mr. and Missus buyer, need
to understand that preparation
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00:13:16,840 --> 00:13:19,600
is key.
If you or someone you know is
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00:13:19,600 --> 00:13:22,760
looking to buy commercial real
estate, make sure to save this
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00:13:22,760 --> 00:13:25,960
video, share it with a friend,
comment your questions, and
232
00:13:25,960 --> 00:13:29,200
subscribe to the channel.
My name's Aviva, I'm here in
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00:13:29,200 --> 00:13:31,360
Denver, Co with the warehouse
hotline.
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00:13:31,360 --> 00:13:33,960
Thank you for watching.
I'm excited to see what
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00:13:33,960 --> 00:13:35,800
questions you put in the
comments.
00:00:00,040 --> 00:00:04,200
We have identified 123 Main St.
it underwrites, we have our
2
00:00:04,200 --> 00:00:07,960
money in order, we have our PSA
signed, we're under contract,
3
00:00:07,960 --> 00:00:11,200
we're doing our due diligence,
we're working with a broker and
4
00:00:11,200 --> 00:00:14,320
hopefully an attorney and we're
marching towards a close.
5
00:00:14,720 --> 00:00:18,920
Congratulations, you are now on
your way to buying your first
6
00:00:18,920 --> 00:00:21,920
commercial property.
OK, I'm going to start that
7
00:00:21,920 --> 00:00:24,400
over.
Let's talk about buying
8
00:00:24,400 --> 00:00:25,960
commercial real estate for
dummies.
9
00:00:25,960 --> 00:00:28,640
First question that comes up,
well, isn't commercial real
10
00:00:28,640 --> 00:00:32,200
estate crashing?
Well, my friends, it's not.
11
00:00:32,200 --> 00:00:35,760
If it was, I'll be happy because
then we could buy even more and
12
00:00:35,760 --> 00:00:38,800
help our clients buy even more.
But the reality is it's
13
00:00:38,800 --> 00:00:40,840
commercial real estate is not
crashing, right.
14
00:00:41,200 --> 00:00:43,640
You may have turned on the news
this week and you saw that Eddie
15
00:00:43,640 --> 00:00:47,040
Bauer and Francesca's are
closing 600 stores.
16
00:00:47,040 --> 00:00:51,960
And yes, that's alarming, but
you have to understand the way
17
00:00:51,960 --> 00:00:56,960
that we are consuming product
and interaction and everything
18
00:00:56,960 --> 00:01:00,080
in between is facilitated by
commercial real estate.
19
00:01:00,080 --> 00:01:04,959
So while these Eddie Bauer
stores may be closing, right,
20
00:01:04,959 --> 00:01:09,000
people are not buying camping
supplies in retail stores
21
00:01:09,000 --> 00:01:11,000
anymore.
These stores are being
22
00:01:11,000 --> 00:01:15,640
backfilled by pickleball
concepts and new age retail
23
00:01:15,640 --> 00:01:20,440
concepts faster than you can say
the only four letter word in
24
00:01:20,520 --> 00:01:23,320
commercial real estate, which is
vacancy.
25
00:01:23,480 --> 00:01:27,800
All of that to say, while the
media might be spewing lies
26
00:01:27,800 --> 00:01:30,280
about commercial real estate,
the market is not crashing.
27
00:01:30,320 --> 00:01:35,360
There has certainly been a
rebound from 2021-2022 and we
28
00:01:35,360 --> 00:01:39,160
talk about that in other videos.
Interest rates low, prices high.
29
00:01:39,400 --> 00:01:42,760
However, in this episode, we are
also going to be answering your
30
00:01:42,760 --> 00:01:46,040
biggest questions when it comes
to buying commercial property.
31
00:01:46,040 --> 00:01:49,240
What are the listing services?
What are the steps?
32
00:01:49,280 --> 00:01:51,720
What am I even buying and how do
I underwrite it?
33
00:01:51,920 --> 00:01:54,120
I'm very, very excited to chat
so let's dig in.
34
00:01:54,160 --> 00:01:57,440
You know, I walked into my
office last week and I said Jen
35
00:01:57,560 --> 00:02:01,640
to my office manager, I saw this
warehouse priced at 120 bucks a
36
00:02:01,640 --> 00:02:04,880
foot and she said Aviva, it's
buying season.
37
00:02:05,160 --> 00:02:08,320
And she's not wrong.
We are seeing prices coming down
38
00:02:08,320 --> 00:02:13,120
in a serious way and this might
be the best opportunity ever to
39
00:02:13,120 --> 00:02:16,840
buy commercial real estate.
So I want to get into my 2 top
40
00:02:16,840 --> 00:02:20,480
tips for buying commercial real
estate as they pertain to
41
00:02:21,040 --> 00:02:24,480
getting a deal done.
Tip #1 You have to get your
42
00:02:24,480 --> 00:02:28,600
financing in order first.
Out of respect for your time.
43
00:02:28,680 --> 00:02:32,120
Out of respect for my time, your
partner, your spouses, your
44
00:02:32,120 --> 00:02:35,080
parents, your kids.
Out of respect for their time.
45
00:02:35,120 --> 00:02:37,880
You need to understand where the
money's coming from.
46
00:02:37,880 --> 00:02:40,960
What does that mean?
One talk to a commercial lender.
47
00:02:41,600 --> 00:02:47,880
See what you need in order to
get a building with a loan or
48
00:02:47,880 --> 00:02:49,360
you need to talk to your
partners.
49
00:02:49,360 --> 00:02:54,120
Maybe you're raising OPMOPM
stands for Other People's Money
50
00:02:54,120 --> 00:02:57,800
to buy commercial property, and
that's an amazing Ave. to do so.
51
00:02:57,800 --> 00:03:01,080
However, in order to buy
commercial real estate, before
52
00:03:01,080 --> 00:03:05,720
you start your showings, before
you start offers, you need to
53
00:03:05,720 --> 00:03:10,360
know where the money is coming
from and how you plan to finance
54
00:03:10,360 --> 00:03:11,640
it.
Now that you've got your
55
00:03:11,640 --> 00:03:15,640
financing order tip #2 is to
pick a product.
56
00:03:15,640 --> 00:03:17,520
What does that mean?
I thought we were buying
57
00:03:17,520 --> 00:03:20,680
commercial real estate.
I thought you would never ask.
58
00:03:20,800 --> 00:03:23,920
Commercial real estate is an
umbrella term where then there
59
00:03:23,920 --> 00:03:27,640
are many, many different product
types that you probably never
60
00:03:27,640 --> 00:03:30,920
would have even thought that
you've consumed or walked into
61
00:03:30,920 --> 00:03:32,840
under the umbrella of commercial
real estate.
62
00:03:32,840 --> 00:03:36,560
This could be retail.
This could be medical office,
63
00:03:37,080 --> 00:03:41,960
this could be multifamily or
hospitality, or industrial.
64
00:03:41,960 --> 00:03:46,400
In order to buy a commercial
asset, you need to know what
65
00:03:46,400 --> 00:03:49,080
you're buying and why.
For example, here at the
66
00:03:49,080 --> 00:03:52,840
Warehouse Hotline, we only
transact industrial properties,
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00:03:52,840 --> 00:03:55,720
industrial land, and a little
bit of retail.
68
00:03:55,920 --> 00:03:59,800
The reason you need to pick your
product prior to searching is
69
00:03:59,800 --> 00:04:03,680
because you need to know how to
underwrite these properties
70
00:04:03,680 --> 00:04:07,400
before you start your search and
you do not not want to have to
71
00:04:07,400 --> 00:04:12,600
rely on a broker, the listing
agents broker, or even your own
72
00:04:12,600 --> 00:04:14,760
broker to underwrite that deal
for you.
73
00:04:14,760 --> 00:04:17,200
Why?
The reason you can't just let
74
00:04:17,200 --> 00:04:21,120
your broker underwrite the deal
is because there are, believe it
75
00:04:21,120 --> 00:04:25,960
or not, scenarios where brokers
mess up and when the deal closes
76
00:04:25,960 --> 00:04:29,400
and you have now underwritten
the property based on the
77
00:04:29,400 --> 00:04:32,160
brokers numbers, that may be
incorrect.
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00:04:32,160 --> 00:04:34,960
At the end of the day, if you
have bought the property, you
79
00:04:34,960 --> 00:04:37,400
signed on the dotted line, it's
your issue.
80
00:04:37,400 --> 00:04:39,000
It's no longer the brokers
issue.
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00:04:39,200 --> 00:04:44,200
So while brokers are amazing to
help facilitate deals,
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00:04:44,480 --> 00:04:46,160
underwriting needs to come from
you.
83
00:04:46,160 --> 00:04:48,560
Due diligence needs to come from
you, right?
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00:04:48,560 --> 00:04:52,800
The buck stops with the buyer
because at the end of the day
85
00:04:53,320 --> 00:04:56,920
when the deal is closed, the
buyer is the person handling the
86
00:04:56,920 --> 00:04:59,880
property.
So very important to do all of
87
00:04:59,880 --> 00:05:03,760
your own due diligence.
Step #2 for buying a commercial
88
00:05:03,760 --> 00:05:08,760
property is to pick your product
and start practicing.
89
00:05:09,360 --> 00:05:13,120
Practice underwriting a multi
tenant triple net warehouse.
90
00:05:13,360 --> 00:05:15,800
If you don't know what triple
net means, I've got a video
91
00:05:15,800 --> 00:05:17,960
about it.
But also we have amazing
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00:05:17,960 --> 00:05:22,160
resources online.
Chachi PT Google that literally
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00:05:22,160 --> 00:05:23,560
five years ago.
We're not options.
94
00:05:23,560 --> 00:05:27,840
So in order to get a deal done,
you need to sharpen your pencil,
95
00:05:27,880 --> 00:05:31,040
figure out what you're buying
and how to underwrite it so that
96
00:05:31,040 --> 00:05:33,720
when we start touring and we
start looking at these
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00:05:33,720 --> 00:05:36,400
properties, you are able to move
fast.
98
00:05:36,640 --> 00:05:39,280
Now you might be saying to
yourself, where am I finding
99
00:05:39,280 --> 00:05:41,600
these properties where I can
learn how to underwrite?
100
00:05:41,600 --> 00:05:45,720
And I thought you'd never ask.
There's a a really interesting
101
00:05:45,800 --> 00:05:48,400
commercial real estate ISM out
there and it's the listing
102
00:05:48,400 --> 00:05:50,520
services.
So the question is, what are the
103
00:05:50,520 --> 00:05:52,200
commercial real estate listing
services?
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00:05:52,200 --> 00:05:55,560
How can I go shopping for a
street buyer?
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00:05:55,600 --> 00:05:58,360
What's that mean for a
commercial buyer?
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00:05:58,400 --> 00:06:03,520
There are many various listing
sites for commercial real
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00:06:03,520 --> 00:06:06,160
estate.
Some are accessible to the
108
00:06:06,160 --> 00:06:10,560
general public, some are not.
You as a buyer want to be making
109
00:06:10,560 --> 00:06:12,520
sure that you're looking at all
of your options.
110
00:06:12,520 --> 00:06:16,520
So you will start by going on to
Loopnet and Craxie, which are
111
00:06:16,520 --> 00:06:19,680
options open to the general
public where you can start
112
00:06:19,920 --> 00:06:22,760
looking at properties,
practicing underwriting, getting
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00:06:22,760 --> 00:06:26,160
numbers, etcetera.
Now you will also be hiring a
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00:06:26,160 --> 00:06:29,600
broker because the broker will
have access to Costar.
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00:06:29,600 --> 00:06:34,480
Costar is the main database
nationally where brokers post
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00:06:34,560 --> 00:06:36,480
their commercial real estate
listings.
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00:06:36,600 --> 00:06:41,040
Costar is really expensive, so
the general public doesn't have
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00:06:41,040 --> 00:06:44,800
Costar subscriptions.
However, Costar owns Loopnet.
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00:06:44,960 --> 00:06:48,760
So you're asking yourself, I
thought you just said we don't
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00:06:48,760 --> 00:06:51,160
have access to Costar, but then
we have Loopnet and what's the
121
00:06:51,160 --> 00:06:52,640
difference?
Good question.
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00:06:52,760 --> 00:06:56,680
The properties you see on
Loopnet are paid for by either
123
00:06:56,680 --> 00:07:00,960
the seller or the broker to get
more exposure from Costar.
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00:07:00,960 --> 00:07:06,360
So what that looks like is I go
into Costar and I set up and pay
125
00:07:06,360 --> 00:07:09,640
extra for your property to be
seen on Loopnet.
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00:07:09,720 --> 00:07:14,160
Not all properties that are
brought to the market are put on
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00:07:14,160 --> 00:07:16,400
Loopnet.
That's why you need a broker to
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00:07:16,400 --> 00:07:20,280
help you discover the properties
that are not paid extra for in
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00:07:20,280 --> 00:07:23,760
order to get that visibility.
Now, there's a misconception
130
00:07:23,760 --> 00:07:25,640
that properties on Loopnet are
bad.
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00:07:26,240 --> 00:07:28,720
That is not true.
I've seen amazing deals on
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00:07:28,720 --> 00:07:33,120
Loopnet and I've seen buyers buy
amazing deals on Loopnet and two
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00:07:33,400 --> 00:07:35,640
buyers want off market deals.
Why?
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00:07:35,640 --> 00:07:38,360
I understand right?
It's a element of wanting what
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00:07:38,360 --> 00:07:41,600
you can't have.
However, as someone who sells
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00:07:41,600 --> 00:07:46,000
buildings for a living, the way
that I see buyers get the best
137
00:07:46,000 --> 00:07:50,600
deals are not buying off market
deals, but rather buying deals
138
00:07:50,600 --> 00:07:52,240
that have sat on the market for
a while.
139
00:07:52,320 --> 00:07:56,400
So for whatever reason, the
seller is fatigued and in that
140
00:07:56,400 --> 00:08:01,080
case more likely to give you a
better deal on a property as
141
00:08:01,080 --> 00:08:03,920
opposed to a seller who doesn't
even want to sell in the first
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00:08:03,920 --> 00:08:06,160
place and you have an off market
deal.
143
00:08:06,160 --> 00:08:10,280
So a few misconceptions about
buying property and the listing
144
00:08:10,280 --> 00:08:12,680
services.
There are good deals to be had
145
00:08:12,680 --> 00:08:16,240
on Loopnet and just because a
deal is off market doesn't make
146
00:08:16,240 --> 00:08:20,880
it better to the average buyer.
To recap, the commercial real
147
00:08:20,880 --> 00:08:25,400
estate listing sites that you as
the general public ought to be
148
00:08:25,840 --> 00:08:29,200
shopping and consuming on are
Loopnet and Krexi.
149
00:08:30,080 --> 00:08:33,919
Then you also want to make sure
that your broker is pulling
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00:08:34,000 --> 00:08:38,200
properties from costar to see
the properties that the general
151
00:08:38,200 --> 00:08:42,240
public does not have access to.
This is going to give you the
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00:08:42,240 --> 00:08:47,000
most comprehensive understanding
of the properties available for
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00:08:47,000 --> 00:08:49,360
sale in the market of your
choosing.
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00:08:49,640 --> 00:08:52,840
All right, so we've got our
money, we know our product type,
155
00:08:52,840 --> 00:08:55,840
but the question arises, who
pays the broker?
156
00:08:56,080 --> 00:08:58,760
And I thought you'd never ask.
When a property goes on the
157
00:08:58,760 --> 00:09:03,280
market, generally speaking, the
listing agent and the seller
158
00:09:03,280 --> 00:09:07,520
agree to a Commission that will
then be split by the listing
159
00:09:07,520 --> 00:09:10,080
agent and the buyer agent at
closing.
160
00:09:10,320 --> 00:09:15,560
So generally the seller pays the
Commission for the listing agent
161
00:09:15,560 --> 00:09:20,040
as well as the buyer broker.
Now, in an off market scenario,
162
00:09:20,520 --> 00:09:25,320
generally the buyer will pay the
buyer broker the Commission.
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00:09:25,440 --> 00:09:27,880
Here's the fun part,
Everything's negotiable.
164
00:09:28,280 --> 00:09:31,200
That said, if you're looking to
sell a commercial property, you
165
00:09:31,200 --> 00:09:33,360
should pay your fees because
what the fuck bro?
166
00:09:34,000 --> 00:09:37,800
I have been in scenarios where
I'm the listing agent and the
167
00:09:37,800 --> 00:09:42,000
buyer broker goes I don't want a
broker, we'll just take 3% off
168
00:09:42,000 --> 00:09:44,480
the price.
Well Mr. Buyer, unfortunately
169
00:09:44,480 --> 00:09:47,480
that's not an option.
You see the seller and the
170
00:09:47,480 --> 00:09:52,160
listing agent agree to a price
before the property even goes on
171
00:09:52,160 --> 00:09:55,200
the market.
So say it's a 6% Commission.
172
00:09:55,280 --> 00:09:58,160
The seller is already going to
pay the 6% Commission.
173
00:09:58,160 --> 00:10:01,160
They have signed on the dotted
line and they're already
174
00:10:01,160 --> 00:10:04,400
underwriting the 6% out of the
final amount.
175
00:10:04,800 --> 00:10:08,920
Now the buyer is going to come
in and they are either going to
176
00:10:08,920 --> 00:10:13,440
not have representation in which
then the listing agent will get
177
00:10:13,440 --> 00:10:18,280
the full 6% Commission, or the
buyer broker can find a broker,
178
00:10:18,400 --> 00:10:23,400
have someone have their
fiduciary duty to the buyer, and
179
00:10:23,400 --> 00:10:26,400
it doesn't actually change the
outcome for the seller.
180
00:10:26,680 --> 00:10:29,480
There's that misconception of,
well, if I come in without a
181
00:10:29,480 --> 00:10:32,840
broker, I'll get a better deal.
That's not reality and I
182
00:10:32,840 --> 00:10:34,640
strongly advise against doing
so.
183
00:10:34,840 --> 00:10:38,600
Remember, if a property's on the
market, a fee has already been
184
00:10:38,600 --> 00:10:43,000
delineated and you can ask what
the fee is and how that pertains
185
00:10:43,000 --> 00:10:45,280
to your deal.
All of that to say, we strongly
186
00:10:45,280 --> 00:10:48,920
suggest having a broker so you
have someone with your fiduciary
187
00:10:48,920 --> 00:10:52,160
duty and best interest in mind.
Specifically if you're buying a
188
00:10:52,160 --> 00:10:54,360
property because it doesn't even
cost you anything.
189
00:10:54,480 --> 00:10:56,400
Be smart, don't be cheap.
All righty.
190
00:10:57,000 --> 00:11:00,840
So we've got our financing,
we've got our property type,
191
00:11:00,880 --> 00:11:04,040
we've got our broker, and we've
been practicing underwriting.
192
00:11:04,200 --> 00:11:06,720
Now let's go shopping.
We're hitting the streets, we're
193
00:11:06,720 --> 00:11:10,960
previewing properties, we show
up to 123 Main St. we fall in
194
00:11:10,960 --> 00:11:13,080
love with it and we're ready to
buy it.
195
00:11:13,400 --> 00:11:15,800
So now what's the next step?
We have two options.
196
00:11:16,040 --> 00:11:19,160
We're either submitting ALOI,
which stands for Letter of
197
00:11:19,160 --> 00:11:25,640
Intent or APSA Purchase and Sale
Agreement. 99% of the time we
198
00:11:25,640 --> 00:11:30,880
will draft up an LOI first.
An LOI is essentially a one or
199
00:11:30,880 --> 00:11:36,000
two page document that is a high
level representation of the deal
200
00:11:36,000 --> 00:11:41,080
points, price, due diligence,
time frames, expectations.
201
00:11:41,880 --> 00:11:46,880
If the buyer and the seller can
agree to the terms on the 2,
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00:11:46,880 --> 00:11:51,320
three page document of the LOI,
then we will move to the
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purchase and sale agreement,
which is the real deal, right?
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So there's a lot of legalese,
but all of it to say if we can
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00:11:59,040 --> 00:12:03,760
agree on the LOI, then we can
agree on the PSA as opposed to
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00:12:04,080 --> 00:12:07,040
writing up a 25 page purchase
and sale agreement.
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00:12:07,040 --> 00:12:09,080
And we're fighting over purchase
price.
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00:12:09,280 --> 00:12:11,800
We could have saved all that
time with just an LOI.
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So have your broker write up a
letter of intent to begin your
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negotiations with the seller.
All righty, the LOI has been
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00:12:20,360 --> 00:12:23,400
agreed upon, now we're on to the
purchase and sale agreement.
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00:12:23,760 --> 00:12:27,000
Once the purchase and sale
agreement has been agreed upon
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00:12:27,000 --> 00:12:30,320
and side by both parties, mazel
tov.
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00:12:30,320 --> 00:12:33,600
You're under contract, and once
you're under contract, that
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00:12:33,600 --> 00:12:38,120
means the buyer has X amount of
days to perform their due
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00:12:38,120 --> 00:12:41,920
diligence, get their money in
order, and buy the building.
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And once a seller is under
contract, they cannot back out
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00:12:45,840 --> 00:12:47,960
of the deal.
I mean, you can, but then you
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00:12:47,960 --> 00:12:49,640
get sued for specific
performance.
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00:12:49,680 --> 00:12:53,240
It's a bad idea.
We're avoiding lawsuits here in
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00:12:53,240 --> 00:12:54,920
order to buy commercial real
estate.
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00:12:55,160 --> 00:12:58,000
Preparation prevails over
everything.
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00:12:58,160 --> 00:13:00,120
You need to be prepared to get a
deal done.
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00:13:00,200 --> 00:13:03,440
There are people who you can
hire to get in your court to
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00:13:03,440 --> 00:13:06,520
make sure you get the
preparation done, be it
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00:13:06,520 --> 00:13:10,080
attorneys, brokers, people to
help with due diligence,
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00:13:10,080 --> 00:13:12,760
etcetera.
However, at the end of the day,
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00:13:12,760 --> 00:13:16,800
you, Mr. and Missus buyer, need
to understand that preparation
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00:13:16,840 --> 00:13:19,600
is key.
If you or someone you know is
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00:13:19,600 --> 00:13:22,760
looking to buy commercial real
estate, make sure to save this
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00:13:22,760 --> 00:13:25,960
video, share it with a friend,
comment your questions, and
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00:13:25,960 --> 00:13:29,200
subscribe to the channel.
My name's Aviva, I'm here in
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00:13:29,200 --> 00:13:31,360
Denver, Co with the warehouse
hotline.
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00:13:31,360 --> 00:13:33,960
Thank you for watching.
I'm excited to see what
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00:13:33,960 --> 00:13:35,800
questions you put in the
comments.
