AriZona Real Estate insider!

Many professionals including commercial real estate insiders and expert are screaming the commercial real estate market, including the local Phoenix, Arizona metro market, is currently facing an imminent crisis with predictions of challenges surpassing those experienced during the 2008 financial downturn.

“According to a report by Kiran Raichura, Capital Economics predicts a 35% decline in office values by the end of 2025, with little hope of recovery before 2040. The shift to remote work has led to reduced demand for office space, causing key-card swipes to drop to 50% of pre-pandemic levels and increasing office vacancy rates to 19% in Q1 2023. Major landlords are returning vacant office assets to lenders, and real estate investment trust investors are shying away from office properties, resulting in a significant decrease in office REIT total returns. The future for office owners appears challenging, necessitating a broader examination of the state of the commercial real estate market.”

Amid these uncertainties, selling a vacant office building before the crash in Phoenix-Metro is a wise decision and requires a well-structured approach to ensure a successful transaction.

Below is a Step-by-Step Guide to Selling Your Vacant Office Building:

Property Assessment: Commence the process by conducting a comprehensive evaluation of your vacant office building to determine its current market value. Key factors to consider include:

• Location
• Size
• Condition
• Amenities
• Unique Selling Points that may set it apart from other properties.

Legal and Financial Preparations: Gather all relevant documents related to the property, including the title deed, survey reports, property tax information, and any outstanding mortgages or liens. To ensure all legal aspects are in order, consider consulting a real estate attorney with expertise in commercial property transactions.

Engage a Real Estate Agent or Broker: Enlist the services of a reputable real estate agent or broker like Juan Pesqueira with Attorneys Realty who specializes in commercial properties within the Phoenix area. An experienced professional can provide invaluable insights, expertly market your property, and skillfully negotiate the best deal on your behalf.

Marketing Strategy: Collaborate with your real estate agent to devise a comprehensive marketing plan. Utilize a mix of traditional methods, such as signage and brochures, along with digital platforms such as LoopNet, Crexi, and single property website to maximize exposure and reach a wider audience of potential buyers.

Prepare the Property: Ensure that your Phoenix area office building is in excellent condition and visually appealing to potential buyers. Undertake necessary cleaning and repairs both indoors and outdoors.

Pricing: Set a competitive and realistic asking price based on the property’s market value and current trends in the Phoenix market. Striking the right balance between competitiveness and profitability is crucial, as overpricing may deter buyers, while underpricing could lead to financial losses.

Negotiation: Anticipate negotiations with potential buyers and be prepared to address their inquiries and concerns. Your real estate agent will play a crucial role in guiding you through this process and ensuring your interests are safeguarded.

Offer and Contract: Upon receiving an offer, carefully review it with your agent and attorney and be open to negotiations on terms, if necessary. Once both parties reach an agreement, a purchase contract will be drafted, outlining the terms and conditions of the sale.

Due Diligence and Inspections: During the due diligence period, the buyer will conduct inspections and investigations to ensure the property aligns with their requirements. Cooperation during this phase is vital, as providing access and necessary information will facilitate a smooth due diligence process.

Closing: Upon meeting all inspections and contingencies, and once the buyer secures financing, the sale can proceed to closing. At this stage, all essential documents will be signed, and ownership of the property will be transferred to the buyer.

Post-Sale Obligations: Following the sale, ensure a seamless transition for the buyer by transferring all pertinent information and records related to the property.

As the Phoenix, Arizona commercial office real estate market navigates through choppy waters, a systematic and strategic approach to selling your vacant office building in Phoenix-Scottsdale-Mesa area is essential. Patience, collaboration with real estate agent or broker and attorney professionals, and a keen focus on market dynamics will contribute to a successful transaction. By adhering to this step-by-step guide, stakeholders can make informed decisions and mitigate potential risks, ensuring the stability and resilience of the commercial real estate market amidst uncertainties.