Commercial Property in Brisbane which may be a bit sour!
- 2938 reads
Hi,
So a person I know who is currently overseas bought an "investment" commercial property from a company called ozzieoppertunities 4 years ago in Brisbane on the Airport Road in the Gateway Business Centre... the people who sold the property have been acting as agents and haven't been able to lease the property for the last 4 years, they say its a "slow market" and that there's no point in trying to sell it as well as the market is so slow in brisbane, anyway they keep charging for "advertising" and the most recent bill was for 1000AUD to advertise the property.
Any advice on how to proceed with this situation??
What the.
4 years is crazy, and to be getting charged advertising fees is also off, what advertising are they doing for $1000
try this company, they will not charge you advertising fees and they do a good job www.queenslandrealtygroup.com.au
Money for jam.
Engage a commercial agent who knows the market around pinkemba etc not some 'fleecing' agent.
I am opinionated. Take me at face value, read between the lines.
Hey thanks guys for your comments... that was pretty much my thoughts, and think they're just taking the mick, but thought I'd post on here to get your opinions as maybe it was a dud area or something...
I'm still amazed at the four years vacancy, incredible!
Allen Real Estate
Buyers' Agent - Brisbane
www.allenrealestate.com.au 1300 443 581
What the....did i read this right...4 years not rented out? geee
Find a different agent for sure!! this is un heard of....unless he bought a "dump" to start with.
Regards
Michael
Michael Chan ----- Finance (Mortgage/Commercial) Broker----
Michael@Shapehomeloans.com.au | 1300 74 5626 | Fax: 02 8212 8909
Same Bank. Better Rates. Served With A Passion.
Even if they've bought a dump, there is always someone with a budget or a requirement for which it will suit - is it price? lack of marketing? lack of agent input? owner not listening to agent's feedback? etc
I am opinionated. Take me at face value, read between the lines.
I say the agent is not doing this job!! or the owner is stubborn
End of the day - ANYTHING can be rented really as scott mentioned. it just depends what price is being offered.
Regards
Michael
Michael Chan ----- Finance (Mortgage/Commercial) Broker----
Michael@Shapehomeloans.com.au | 1300 74 5626 | Fax: 02 8212 8909
Same Bank. Better Rates. Served With A Passion.
Hi,
I'm pretty much in the same boat, only difference is being in Melbourne. I think with commercial property, biggest difference I felt vs residential is that the vacancy rates are much higher and longer!
It's up to the 7th month mark and I have analysed everything that has "gone wrong" with the property and put it in the best position to be rent out, fixed everything that could be fixed, revised the marketing plan as advised by other members here and also pressed my agent to "work smarter" on renting out the property.
Still fingers crossed for me...
Regards,
Will.
So you didn't dump the agent?
I am opinionated. Take me at face value, read between the lines.
That's true, hence why commerical properties has a higher interest rate due to risk....
But 4 years?!? that's nonsense....
Willister- let us know how you go with your property ie...did you lower rent etc....so another memebrs (including me) can learn if we encounter a simliar problem. :)
Regards
Michael
Michael Chan ----- Finance (Mortgage/Commercial) Broker----
Michael@Shapehomeloans.com.au | 1300 74 5626 | Fax: 02 8212 8909
Same Bank. Better Rates. Served With A Passion.
Scott,
No, I haven't ditched him as yet...I had a face to face discussion with him over the weekend and decided to give him another "4 months" to prove himself. Having a look at the whole picture, I'm monitoring the surrounding properties and they don't seem to have moved either. Several were vacant circa mine was, so I'll keep a close eye. Also called several of the bigger companies and the gist was it is perhaps a low demand market issue, so changing the agent won't exactly solve things immediately and I would have to repay some fees such as internet advertising.
Michael,
Will keep you posted of any developments!
All,
What I can share is this, the problems I incurred were twofold:
1. A very slow paying tenant in the first place. I can't stress enough to anyone considering buying commercial property to make sure you check (by however means) that the tenant pays on time, maybe ask the agent if he is willing to provide statements etc.
2. A run down building, this coupled with a slow paying and troublesome client (constant complaining and requests for free rental periods as compensation...)
1 + 2 = Disaster...
I feel perhaps the biggest reason private sales are taking off is the exorbitant fees real estate agents can charge for a couple of hours work. Even a small commission fee of 2% (+10% GST) can mean a home owner could hand over almost $10,000 in agent’s fees on the sale of a $450,000 house.
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Most people are lazy. Ergo, most agents are lazy as well. Maybe lazy isn't the right word but they typically lack innovation. Most of them will list the property on the listing service, put a sign, wait for the phone to ring and call it a day. We actually took on a commercial property with a similar situation. Your agent shouldn't just be putting up signs and waiting for the phone to ring.
We leased our own property by finding nearby businesses who weren't on a lease and were paying above market rates (yes our market is TERRIBLE... worst in the country and some people were still paying more than they should have been). We simply offered them a better price to move. We spruced up the building so it was nicer than their current property and it was already a great location.
Those are the best properties to buy. Management problems (which I group an agent just saying it's "slow" as) are the easiest problems to solve. I mean some of these guys don't even advertise on free online classified sites like craigslist. That's job one!
It amazes me that they kept renewing contracts for something that costs them nothing and has proven not to work. However, another 4 months isn't the worst idea in the world, since they'll probably work hard for new business again. Oh well... you should find a way to buy that conditionally, fix the problem, and resale to an investor as a "cash flow property". Seriously, if you advertise it every day on craigslist, you'll probably have a tenant in 30 days for no cost. If it doesn't work, get more active and propose it directly to nearby business owners.
You can be proactive with your investment even if an agent won't be.
Good luck!
Matthew David
I am the real estate investing anti-guru guru. Check out my real estate investing faq and see for yourself.
Four year is a big time....
Now you can hire a real estate agents who can charge for work. and also trying for the company.