Ways a Sale or Lease Clause Can Save You Money

Serving Santa Barbara, Ventura & San Luis Obispo Counties

October 2018

Why A Lease or Sale Clause Can Save Your Life! 

There are several significant ways that a real estate broker ends up saving a Seller, Lessor, Buyer, or Tenant money during the real estate selling or leasing process.

The single best way for an owner to maximize value is to select an experienced brokerage specialist—and there are many benefits to doing so! Commercial real estate specialists utilize their extensive experience and knowledge to track the market and make accurate judgments about the value of a property. Retail specialists bring an entire arsenal of creativity, tenant relationships and knowledge, tenant broker knowledge, and local jurisdictional experience to the hands of their clients.  “We know which tenants are expanding, and which aren’t.  And we understand the business points in the lease that a retailer will attempt to negotiate.”

Commercial brokerage is complicated work, dealing with business owners, municipalities and building owners—but we at GPS relish the challenges and enjoy the personal satisfaction of assisting clients.

Ways a Lease Clause Will Save The Lessor Money

  • Have a clause in the lease that the Tenant pays all increases in taxes when the property is sold and a new tax base is created. With the cost of CA real estate taxes upon a sale, the impact on the net income is devastating. Include this clause.
  • Go back to market rent at some reasonable time in the future. The best you can negotiate.
  • Don’t give too many options. They are always more favorable to the tenant.

Ways a Sales Clause Will Save The Seller Money

  • Read any changes to the contract made by the Buyer. This may sound simple but many times, people get casual and this can cost them money.
  • Time the contingencies based upon a reasonable estimated time period. Each contingency takes a different amount of time. Have the contract reflect that accordingly.
  • After a reasonable period of time, get monthly amounts for extensions. These can be attributed to the selling price or not.

For more information about this topic or any other of our blog posts please contact:

Pamela Scott | 805.560.0040 | pscott@gpscre.com

Ways A Real Estate Broker Saves You Money! 

Serving Santa Barbara, Ventura & San Luis Obispo Counties

August 8,  2018

Why A Real Estate Broker Saves You Money! 

There are several significant ways that a real estate broker ends up saving a Seller, Lessor, Buyer, or Tenant money during the real estate selling or leasing process.

The single best way for an owner to maximize value is to select an experienced brokerage specialist—and there are many benefits to doing so! Investment specialists utilize their extensive experience and knowledge to track the market and make accurate judgments about the value of a property. Retail specialists bring an entire arsenal of creativity, tenant relationships and knowledge, tenant broker knowledge, and local jurisdictional experience to the hands of their clients.  “We know which tenants are expanding, and which aren’t.  And we understand the business points in the lease that a retailer will attempt to negotiate.”

Commercial brokerage is hard and complicated work—but we at GPS relish the challenges and enjoy the personal satisfaction of assisting clients.


Ways a Broker Saves the Seller Money

  • Provides real marketplace knowledge to help the Seller assess the right pricing for the property’s sale.
  • Brokers knowledge of the market ensures the Seller, he will not be selling for less than a fair market value.
  • Using their experience and knowledge of what is customary in a transaction, the Broker can advise the Seller when to accept or reject parts of a proposal or during the escrow process.


Ways a Broker Saves The Buyer Money

  • With their knowledge of the local market, the Broker can advise the Buyer of the market rate to eliminate the risk of overpaying. 
  • The Broker can assist in obtaining the most desirable terms from the purchase agreement since they have seen terms of many purchase agreements.
  • Once committed to a Broker, the Buyer becomes equipped with a history of experience and a community network that is invaluable in finding the options that are available to purchase.

 


Ways a Broker Saves The Lessor Money

  • The Broker understands the business points in the lease that a retailer will attempt to negotiate and can use this knowledge to negotiate terms to the Lessor’s favor.
  • The Broker knows lease terms and can advise the Lessor on how to structure the lease terms to add the most value to their investment.
  • The Broker has market knowledge of tenant activity so can go directly and more quickly to all possible prospects.


Ways a Broker Saves the Lessee Money

  • Provides Lessee with market acceptable terms in their negotiations that will save money immediately and over the long run.
  • A broker can provide Lessee with knowledge of local gross sales of similar businesses and acute knowledge of traffic patterns in the local community
  •  With a specialist in retail, they can know the best locations in the area and when an opportunity arises, contact you immediately.

 


 

For more information about this topic or any other of our blog posts, please contact:

Pamela Scott | 805.560.0040 | pscott@gpscre.com

Retailers Taking Smaller Spaces

Serving Santa Barbara, Ventura & San Luis Obispo Counties

May 4, 2018

Retailers Are Taking Smaller Spaces

We all know retail is facing a historic inflection point.  The brick and mortar experience is being de-constructed and re-imagined as retail 2.0 – turning retail space into event zones, pairing the shopping experience with companion experiences that transform a trip to the store into entertainment.   There is also the “omnichannel” concept of offering customers both retail and online shopping in the store, thus showcasing, in many cases, a far larger virtual inventory than the retail footprint allows.

If you can imagine a concept, it’s being considered as developers, landlords and brands struggle to bring consumers back into malls and retail centers to shop.  And a bright spot, in this Age of Amazon, is the re-emergence of local and regional brands who offer  the immediate and personal experience – “I can touch it, feel it, see it and I can talk about it!” – that Amazon simply cannot provide.

In many cases, however, a little start-up with an interesting idea or the local operator of a small business, no matter how unique, just can’t afford very expensive rent. The trend among some enlightened landlords, therefore, is to create, or carve from larger buildings, smaller, more affordable spaces, or subdivide larger spaces to accommodate multiple tenants under the same roof.

The hopeful dynamic here is that landlords who recognize, curate, and support local proprietors who offer retail experiences and products not readily available online are a formula that seems to be working.

 

Above is a 200sf space in a newly renovated mall in Ohio.

The National ICSC Retail Shopping Center Convention is May 20-24, 2018 this month in Las Vegas.

This retail convention draws over 37,000 attendees, 1,200 exhibitors, is in over 853,000sf and holds 30 Educational Sessions and Workshops.

 

“We put the client first”

 

If you would like more information about this topic, please contact Pamela Scott at (805) 560-0040 or email at pscott@gpscre.com.

For all our recent blog posts please visit www.gpscre.com/blog.

Types of Commercial Real Estate

Serving Santa Barbara, Ventura & San Luis Obispo Counties

April 20, 2018

Benefits of Being a Retail Leasing Specialist 

 

There are five types of commercial property: retail properties, office properties, industrial properties, multifamily properties and investment properties.  In the business world, brokers usually specialize in one or another of these.  Often smaller communities have their share of local brokers who specialize in everything but limit their territorial scope.

Conventional wisdom says that selecting a brokerage specialist is the best way for an owner to maximize value.  And there are many benefits to doing so.  Retail specialists approach the task holistically, meaning we bring our entire arsenal of creativity, tenant relationships and knowledge, tenant broker knowledge and local jurisdictional experience to bear.  We know which tenants are expanding, and which aren’t.  And we understand the business points in the lease that a retailer will attempt to negotiate.

Commercial brokerage is hard, complicated work.  But we at GPS relish the challenges and enjoy the personal satisfaction of assisting clients to service the public.  Everyone knows we’re at an inflection point: retail is changing.  There are those who are frightened by these changes.  But we at GPS don’t see change as fearful, but as exciting.


The Types of Commercial Real Estate

 

1.  Retail

  • Can range in size from small neighborhood shopping centers to large regional malls plus free-standing buildings
  • Mix of national and regional and local users in all markets
  • Influenced greatly by the national economy but also local factors like the property location, traffic flow, and population demographics

 

2. Office

  • Can range from large multi-tenant deals to smaller single-tenant deals
  • Most tend to be Long-term leases due to high cost of improvements so big changes in rental rates and large costs can occur when leases expire
  • Leases have special features that are specialized for the businesses

 

3. Industrial

  • Involves deals with manufacturing facilities, warehouses, research, development spaces
  • Not as much influenced by local trends but more by large economic trends like global trade growth
  • Normally occupied by one tenant – lack of diversity could become an investment risk
  • Long-term lease that can fall behind the market and lead to large changes in lease rates

 

4. MultiFamily

  • Deals with properties such as apartment complexes
  • Population demographics, local employment growth, and household formation rates can drive and affect the success of this market
  • Short leases that easily adjust to the market
  • More defensive investment type

 

5. Investments

  • Can be NNN leased investments
  • Can range from large multi-tenant investments to smaller single-tenant investments
  • Investments can be Retail, Office, Industrial, and Multi-Family transactions

 


For more information about this topic or any other of our blog posts, please contact:

Pamela Scott | 805.560.0040 | pscott@gpscre.com

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