Hiring the right realtor

Hiring the right Realtor can be challenging especially if it’s your first time.
finding a Realtor with experience, compassion, an excellent understanding
of the market he operates in as well as one with a high ethical and moral
standard is key to successfully buying or selling real estate!

HIRING THE RIGHT REALTOR can be a daunting task. Most Realtors start their career when they complete real estate college by aggressively asking friends and family for leads/listings as who else is going to trust them with no real experience in the business. I did the same thing. And while I did have my ups & downs my first couple years in the business I’ve now been doing this for 10+ years and I’ve learned a lot over the course of my career in Organized Real Estate.

However, no matter the amount of experience a Realtor has there are a few things that can fundamentally change your experience when using a professional Real Estate Sale Representative or Broker. The standard OREA “Working with a [Commercial] Realtor form” is a form that must be signed by a Buyer or Seller specifically explaining whether the Buyer or Seller is a Customer or a Client to the Brokerage. The agreement states:

Is representing my interests, to be document in a separate written agency representation agreement, and I understand the brokerage may represent and/or provide customer service to other sellers and buyer.
OR
Is not representing my interests, to be documented in a separate written customer service agreement, but will act in a fair, ethical and professional manner.

A Realtor/Brokerage can only truly represent one Buyer or Seller’s best interest however it’s important for Realtor to always act fair, ethical and in a professional manner no matter who’s interest they are representing. Which brings me to the point of this BLOG.

I recently SOLD a 5 plex building in Springwater Township Conditionally (4 residential units and 1 commercial unit). The deal failed in the 25th hour. While my client (the Seller) was clearly upset (as was I) I had new advice for my client which I’ve been told is sort of unheard of in the industry. After spending 3 months working on this sale and getting to know the building as well as my client and understanding more & more about the financials of the building it occurred to me that the right thing for my client to do was hold the building, add an addition and then refinance the property thus withdrawing equity that is TAX FREE.

During my marketing due diligence period I contacted the Township of Springwater to enquire and educated myself on the maximum potential building envelope of the property. I learned that the existing Commercial building could have more residential units added so long as the parking allocation (2 vehicles per unit) was maintained. After doing some quick arithmetic I realized that at least one unit could be added without an issue and the potential for a second unit could be added with a minor variance to reduce the final unit’s parking count to only 1 space instead of 2. Having a Realtor that understands the Planning Act is beneficial as I’ve demonstrated.

I also contacted my “go-to” financier, Alex Nuttall, who was able to give me a quick turnaround on what sort of financing options were available. I explained to him that while we wanted to take advantage of today’s low interest rates we also wanted to plan ahead; I do not claim to be an Economist but I do shy on the side of caution and I would hate to see my client borrow equity against their property only to find out that in 5 years (when the mortgage would presumably renew) that interest rates had gone up to a more traditional rate. I therefore asked Alex to calculate what the maximum amount of equity that could be borrow at a future interest rate of 5%,6% and 7% annually while remaining cash flow positive. This is something I already learned while doing a CCIM course but banks do have other criteria that vary from bank to bank and I wanted his opinion. We established that my client could withdraw 50% equity from the value of the property and still remain cash flow positive with all 3 higher interest rate scenarios.

Read also: 5 Questions To Ask Your Commercial Realtor®

Since then my client has moved ahead with the due diligence required to add two new residential units. I placed a new restaurant tenant into the store front ground floor commercial unit who I’m happy to say will be opening soon and serving some delicious East Indian dishes which I can’t wait to try. My client is thrilled with the additional rental income but more importantly they are most happy with the ability to withdrawn equity TAX FREE while having the piece of mind knowing that even if interest rates rise they should still be in a cash flow positive financial scenario upon renewal of their mortgage which means they can sleep very well at night!

I forwent a $50,000 sales commission on the property however. And while I could definitely use the money, it was the RIGHT THING TO DO. The right thing to do isn’t mentioned in the Working with a Realtor form and hence my BLOG today. Working with a Realtor with experience is one thing. Working with a Realtor who can see the big picture, understands finance, who has a knowledge of the Planning Act and who can provide a truly honest opinion is another story altogether. I hold Myself to a higher standard and it is why I have the greatest clients I could ask for. I believe in working above board and I hold my standards high as I’m holding myself accountable to them. And while I’m definitely not perfect (I still make mistakes), I too sleep well at night knowing I’ve done by very best for my clients.

I’m in this for the long term!

Need a Commercial Realtor®?

Phillip Moore
Sales Representative
Sutton Incentive Realty Inc., Brokerage
Phillip Moore commercial realtor

Phillip Moore is Commercial and Industrial Realtor with 15 years of asset and property management experience. His wealth of knowledge in budgeting, financing, zoning, planning ad project management differentiates him in the real estate industry.

He will guide you through the pitfalls of industrial and commercial leasing, purchasing and sales to ensure that you have the best possible advice when making your final decision. Phillip is a Certified Commercial Investment Member (CCIM) student, a University of Western Ontario graduate, he is a member of the Barrie Construction Association, he is a member of both the Toronto and Barrie Real Estate Boards, he is a former member of the Committee of Adjustments and until recently a member of the Property Standards Committee.

Phillip work for years as the General Manager of PBM Realty Holdings Inc. a Barrie company that owned upto 1.5M square feet of Industrial & Commercial real estate holdings. Phillip also worked for Cushman & Wakefield in the Toronto East Office where he honed his abilities to structure real estate transaction with a high caliber of professionalism. He was top 10 for new business his first year at C&W. He now works for Sutton Incentive Realty Inc., Brokerage specializing in ICI Real Estate.