The Zen of Selling Commercial Real Estate: Help Your Buyer Find Balance Between Their Dreams and the Realities of Site Selection

Real estate brokers often face unrealistic expectations from clients whose passion and vision may cloud their judgment during the commercial real estate site selection process. The broker’s role is to work off of the buyer’s enthusiasm and ideas, while injecting some realism into the process.

While you don’t want to throw cold water on your client’s ideas, you can ease the process in the long term by offering a fact-based view of costs and functionality.

The key to finding common ground and a site that will fit the client’s vision while also working within the budget and timeline is to be clear up front about the functional and operational requirements, define any limitations such as cost and timeline, and find a way to marry the business passion with the building passion.

Common Site Selection Struggles for Commercial Real Estate

While every commercial real estate client is unique, there are common struggles that crop up during the site selection process that are worth mentioning. If you’re prepared to address these elements from the very beginning, it can help set expectations from the very beginning and pave the way for a smoother process.

• Utility Requirements: Are all of the utilities that are needed to operate the business (water, sewer, broadband, fire protection) available and operational?

• Zoning and Regulatory Constraints: Is the proper zoning and land use designation in place to fit the needs of the business? For example, is the building already zoned for commercial use or is it a historic residential structure that will require rezoning as an adaptive reuse project? Those extra steps, while potentially worthwhile, could add months and significant cost to the project and are worth serious consideration.

• Transportation Needs and Impact: Is there appropriate access to the site for both customers and staff? Is there sufficient parking (either on site or on the street)? For retail and other customer-facing businesses, is there sufficient visibility to provide the business with “street presence”? For businesses that receive and store large shipments of product, is there an appropriate loading area and enough storage space?

Begin With a Conversation 

The best way to set up the commercial real estate site selection process for success is to begin with a thoughtful conversation about the client’s vision, and what is driving that vision, as well as the basic functional needs of the business. From there, you can begin to identify a list of “must haves” and a list of “nice to haves”. 

This conversation can begin by identifying the following basic requirements: 

1. Cost
2. Functional needs
3. Location
4. Existing infrastructure requirements
5. Transportation access

In addition, the client’s vision is crucial because it will be driving many of their gut responses to the options.

• What is their image of what their future space will look like? Will it be historic, with high ceilings and interesting architectural details? Or modern with integrated technology and large windows for ample natural light? While some of the aesthetic goals are things that could be compromised, the entire process will go much more smoothly if you understand up front what the vision is that is driving your client so you can try to meet those interests, if possible.

• How does the business interact with the commercial real estate? What operational requirements impact the space? Is there a need for a conference space, a lobby, a loading dock, or storage? Is cutting technology (and the power to support it) a requirement? How will branding impact the space, and what are the employee needs? How does the business culture impact the lighting, floor plan, and space layout?

• Is redevelopment an option? If the client is drawn to historic structures, it will be crucial to know whether their budget and timeline allow for extensive redevelopment. Bringing a contractor into these early conversations can help open the client’s eyes to the potential impact of their ideas.

By openly discussing the client’s needs vs. wants up front, as well as the budget, timeline, options for rehab, and the need to involve other professionals (such as contractors, interior designers, zoning boards, etc.), you can create a clear picture of how the site selection process will proceed and where the opportunities for compromise exist

Are you undergoing a site selection process for a commercial real estate client in coastal North Carolina or the Hampton Roads, Va. area? Learn more about aggressive local and state incentive packages for businesses in Currituck County, N.C. (just a short 30 minutes from Hampton Roads) by downloading our free guide “5 Reasons You Should Be Thinking Currituck.”