Selling commercial building to tenant

Leveraging, renting vs owning, making an investment or buying a home?
Post Reply
Brenda123
Newcomer
Newcomer
Posts: 1
Joined: 11 Sep 2016 17:38

Selling commercial building to tenant

Post by Brenda123 » 11 Sep 2016 18:18

Hi. First time poster looking for advice. I own a unit in a strip plaza. The unit has a commercial space on the main floor occupied by an optometrist, and a residential apartment upstairs. Both tenants have been there 15+ years. I am getting older and have decided to sell the property, and the optometrist has expressed interest in purchasing it (the entire unit). The optometrist's five-year lease expires at the end of January, 2017. The optometrist told me more than six weeks ago that he had hired an appraisal company to value the property and would share the details "within a week". I did not hear back from him, however, so I contacted him again last week and he said he did not have the information yet but expected to obtain the appraisal "within a week". I am beginning to wonder if he is deliberately stalling, and if so, why? Should an appraisal take this long? Should I give him a deadline and say "If you do not get back to me with an offer by, say, Oct. 1 (or whatever) I plan to list the property"? Is it to my advantage to list the property while he is still in it? Or should I wait until the lease expires and he moves out and then list it? He has a thriving business and I cannot imagine he would want to move - it would cause a lot of disruption for him - so selling privately to him would seem to make the most sense for everyone, but he seems to be in no hurry to make an offer. I have asked a couple of agents come through already so I have an idea of what the property is worth, but I am reluctant to ask them for advice because they may not want to help if the know the property might be sold privately. I am a widow and would appreciate any advice on how to handle this situation. Thank you.

Spudd
Silver Ring
Silver Ring
Posts: 458
Joined: 22 Sep 2013 14:52

Re: Selling commercial building to tenant

Post by Spudd » 12 Sep 2016 12:12

I recently purchased a commercial building, and the presence of a long-time reliable tenant was a huge factor in my making the decision to buy it. Had it been vacant, I would have been much less interested.

Has he said he will move out if you don't sell the building to him? I agree your selling it to him would be great, and I would probably be willing to wait a while if that was necessary to make it happen, *especially* if he will be leaving if he can't buy it.

It's great you got some realtors' opinions, that way when he comes back with the appraisal you will know if his offer is in the ballpark or not. Only you can decide how long you want to wait before listing it on the open market. At least around here, commercial buildings seem to take a long time to sell, so be aware that even if you list it, it probably won't be like residential where you can usually sell within a month.

Post Reply