COMMERCIAL REAL ESTATE AUCTIONS.
This refers to the buying and selling of commercial real estate through the auction process. Commercial real estate auctions come with lots of benefits and opportunities for both buyers and sellers and if you are looking to dispose or acquire a piece of commercial real estate, an auction remains a great platform to consider. Reasons why commercial real estate auctions are considered to be of great value are as follows:
- Certainty to close: One major advantage of commercial real estate auctions to all parties is the certainty of close. Before the auction, all bidders are required to register. The registration process involves making a substantial down payment of cash and showcasing an ability to close by providing proof of funds. This helps the buyer that is serious to buy a property at the commercial real estate auction, as the requirements can help to fish out the less serious buyers who have no ability to close and might distract the commercial real estate owner and increase the perception of value. The benefits derived by the seller are quite similar. The commercial real estate owner would be given the assurance that should the target price be reached, the commercial real estate would be sold without any form of delay.
- Competition: Competition is created through an extensive publicizing and promotions. A commercial real estate auction is open to everyone and this leads to a large number of potential buyers. Every buyer wants to outbid the other, leading to an healthy competition and subsequently deciding the true value of the commercial real estate.
- Due to fact that commercial real estates attracts lots of buyers, who are all interested in getting the commercial real estate, the seller may exceed the perceived market value of the commercial real estate.
- There is a defined time frame: In a private sale, there is a tendency that for the buyer to procrastinate. However, this possibility is eliminated by the commercial real estate auction process as a defined date and time is given in which interested buyers must make their quick decisions and stick to it.