As South Africa’s industrial and commercial property boom continues, brokers in this sector are signaling a red light.
Research findings reveal that commercial and private buyers and tenants are not conversant in the art of procuring commercial and industrial properties.
“When searching for commercial and industrial property, there appears to be a misconception regarding the rules of engagement and system in dealing with brokers,” says Graham Alexander, broker and owner of Cape Town’s RE/MAX Commercial City.
In a national research project conducted by RE/MAX Commercial City earlier this month, the views of commercial and industrial property brokers across the country were probed over this topic.
Seventy-two (72) per cent of participants indicated that prospective tenants and buyers do not follow the correct procedures when dealing with brokers.
“Parties interested in buying or leasing buildings, offices, factories or vacant land are often solely to blame for unrewarding outcomes, the wastage of personal time, and lengthy delays in finding property or space.
“A variety of different brokers will be briefed on the buying and rental needs of companies and individuals. The end-result often leads to viewings of the same property only with different brokers representing different companies. This is one of the biggest problems encountered on a daily basis by brokers, and is frustrating for both broker and client,” says Alexander.
He says most commercial and industrial property brokers have up-to-date databases of most vacant industrial land, investment buildings and office blocks in SA, since stock is niche and limited.
“Clients should deal exclusively with only one broker, who will do all the shopping on their behalf, and liaise with other brokers when they do not have the appropriate stock available on their own books,” says Alexander.
“If a broker does not have the required stock available, he or she will negotiate with other brokers who might have the stock. Reciprocal deals are daily occurrences between commercial brokers in SA.
When interviewees were asked whether they work together with rival brokerage firm, and whether there is a close “fraternity” between competitive brokers, 76% said yes.
Eighty two (82) per cent of interviewees indicated that commercial and industrial property seekers should develop an exclusive relationship with one broker, and not approach different brokers simultaneously.
Source: Property24