Owner / Seller Consulting and Brokerage Services:
Property Owner Services
WGV is uniquely qualified to help property owners and land-sellers with a wide range of development issues. In addition to being developers, we also design and entitle projects for both owners and buyers; and have guided both sellers and developers through the often challenging development transaction process. This experience provides us an understanding of which buyers are likely to pay the most for a given property, how best to prepare a site for sale to those buyers, and how to structure and navigate the often complex transaction process. WGV has worked on behalf of private owners, school districts, cities, and religious institutions on the marketing and sale of their properties.
Knowing the Market and Identifying the buyer
Even within the local market, there is a diverse group of development buyers, each with their own site preferences and acquisition strategies. The financial metrics they use, the milestones at which they will pass money or close escrow, and their track record of closing deals are all factors that should be weighed in choosing a buyer.
Knowing whom to contact can maximize the value of the sale, eliminate the likelihood that you’re wasting time with the unsuitable counterparty, and reduce transaction headaches down the line.
Preparing a Property for Sale
Once the right buyer or buyer pool identified, it is important to know what needs to be done to properly market the property to those parties. Some parcels will draw interest as is, but many sites often need targeted study to fully engage the buyers willing to pay the most. And knowing what to investigate means understanding the process a developer undertakes to vet and acquire land.
Builders often have limits on the due diligence their land acquisition personnel can perform during the land buying process. Other buyers will not undertake projects that may have issues that are possible fatal flaws, but can be solved beforehand with the right team and resources. Examples include certain types of land use policy changes or environmental concerns that need to be addressed. Builders often are far more interested if some of these sometimes time-consuming challenges are resolved before committing valuable time and resources to evaluating a purchase.
Some properties should be fully and designed and entitled before marketing; others might require nothing further be done. Understanding which is which (and everything in between), is critical in maximizing returns when selling land. As such, knowing what studies and information the buyers likely to pay the most for a site is critical in marketing a property if the goal is to maximize profits.
Contract Negotiations and Renegotiations
Good contracts make for good partnerships. So understanding what can work and not work for a buyer is critical in drafting an agreement that enhances the financial performance for both the buyer and seller, and increase the likelihood of closing. Drafting mutually beneficial terms with the proper phasing, closing schedule, deposit structure and other key elements requires creativity and experience that typical brokers may not have.
But even with a properly structured deal, contracts are often renegotiated before closing. This ‘retrading’ occurs when a buyer encounters issues that affect its business plan. Politics, neighborhood concerns, and technical issues can all impact a how a project evolves.
Given the complexities of the development process, it is critical that the seller understand the issues a buyer may face while designing and entitling a project, as challenges often arise. While many requests to alter the terms of the sale are in earnest, an owner needs to properly assess what requests are reasonable, what are not, when it’s beneficial to alter an agreement, and when they should stand their ground.