Commercial Real Estate Services
The commercial real estate business in Chilliwack, British Columbia, Canada, is healthy and expanding. Rick Toor is a licensed realtor and commercial property realtor based in Chilliwack BC. Born and raised in nearby Abbotsford, Rick started out managing a number of the family businesses.
The valuable experience he gained there, along with a BCIT Business Administration Program under his belt, saw Rick perfectly poised to start his own commercial real estate services as a realtor under Homelife Glenayre Realty, specializing in commercial property leasing and sales in the Upper Fraser River Valley.
The Chilliwack area became important in the 1850s as one of the steamboat landing points when gold was discovered in the Fraser Canyon. The Township of Chilliwack became the third municipality in British Columbia when it was incorporated in 1873.
Initially given the name of Centreville, it was changed to the more popular name of Chilliwack in 1887, and incorporated as its own municipality in 1908 as the City of Chilliwack. The largely agricultural area has gradually become more and more urbanized. Population growth now stands at a healthy 1.7% annually, and this has seen a consistent increase in demand for residential and commercial properties.
Real estate brokerage
Mortgage lenders are typically banks, but they can also be credit unions, mortgage companies, or trust companies. It’s rare that they will all quote you the same amount, so expect some variation in prices quoted. A mortgage broker, Chilliwack wide, will have access to a number of different lenders, which means you can quickly and easily get the best price available.
A real estate mortgage broker is a professional licensed middle-man between a lender and a borrower. You might wonder why anyone would need a mortgage broker when it’s so easy just to go straight to a bank, thereby cutting out any middleman.
This is especially so as a broker will cost more. It’s useful in this respect to bear in mind that banks are in business to make huge profits. They don’t really like people, but they do like mortgage brokers, as they deal directly with the people.
When a bank deals with a mortgage broker, the whole process gets streamlined. The bank staff have a much easier time when they deal directly with a commercial real estate brokerage.
The process is faster too, which of course means the bank gets its hands on the profits faster as well. A commercial real estate brokerage professional is also likely to be offered a more extensive and comprehensive deal, and the documentation requirements are likely to be less stringent as well.
Commercial Property Leasing
A lease on commercial properties is likely to differ substantially to that of residential properties. It is important that you understand this before setting out to find commercial properties to lease. There are a number of consumer protection laws governing residential leases that in many cases do not cover commercial property leases. For example, the privacy of commercial property tenants is not fully protected, and security deposits have no caps. The laws and rules can differ from state to state, but generally speaking, leases for residential properties come with a greater degree of protection.
Negotiations are usually more prolonged as commercial tenants often require special fixtures or features installed. Landlords are usually willing to comply with whatever a commercial tenant wants, within reason, for a lot of money is usually at stake, and as a result, the commercial lease tends to be long term and much more difficult to change once an agreement has been reached. Also, each commercial lease is usually customized to the tenant’s needs, which means they are not based on a standard agreement, or a standard form.
The duration of a commercial lease is rarely less than a year, and more often a number of years, with perhaps a three year minimum lease time. Landlords like to see their commercial buildings constantly under lease if possible, as this will make the properties much more valuable to them.
With long term leases, landlords are likely to be much more amenable to lengthy negotiations where the tenant may leverage better lease rates, for example. While this may seem counterintuitive at first glance, it isn’t really, as the longer lease will very likely provide a better overall deal for the landlord as well.
A Commercial Property Realtor
A commercial real estate agent and a commercial property realtor are more or less the same thing, or at least, they can be. However, not all real estate agents are realtors, while all realtors are real estate agents. It isn’t as confusing as it sounds, really.
Everyone who wants to sell real estate must be licensed to sell real estate. In other words, they must pass a state exam and gain a state-approved license that allows them to carry out property transactions. Getting this far makes them a real estate agent.
If someone wants to become a commercial property realtor, they need to take the extra step of becoming a member of the National Association of Realtors. This means they have subscribed to the Realtors Code of Ethics. This code exists as a strictly enforced regulatory system within the industry.
The Realtors Code of Ethics contains 17 Articles. Within these Articles are various Standards of Practice. All together, the Code of Ethics restricts and confines a realtor much more than anything governing a real estate agent. This means that you can expect a much higher standard from commercial real estate services that have a realtor is employed.
A real estate broker is also a distinct level within the real estate industry. Brokers are those who have studied and passed an exam for a broker’s license. This exam is a step above that of a real estate agent exam. They can choose to work alone, or they can choose to hire real estate agents to work under them.
In most US states it is a requirement that a broker has a suitable amount of experience, often several years, working as an agent before they are allowed to even take the broker exam. The exam usually has both state and national sections that must be completed successfully.
Commercial Real Estate
Closing a sale or securing a leasing agreement with commercial real estate is harder to achieve, initially at least, than with residential real estate. However, the deals are nearly always much more lucrative, and in the case of a lease, it tends to be for a much longer time period as well, typically three years at least. Agents selling office buildings and the like receive a percentage of the sale price. Commercial buildings can be worth several million dollars, compared to a typical American house, which might go for $150,000 to $200,000, typically.
There’s more emotion involved in the sale of residential properties, than in commercial properties. Families are involved in residential sales and residential rentals, and they need to be able to assess things like nearby amenities, shops, schools, churches and the like, as well as the kind of neighbourhood they will be living in.
Families tend to buy houses or apartments for the very long term, so it’s important for them that they can get along with their neighbours, that they are reasonably close to public amenities, that their children will have the right kinds of opportunities in the area, and simply that they all like the place.
With commercial real estate there is not usually much emotion involved. Everything is assessed on a practical business basis. It’s all about turning a healthy profit, so things like lease rates, property management and the like are given equal consideration to location, usually, and in the case of office buildings and industrial buildings, for example, where the public are not too important, location is not much of a consideration either. It’s really only in retail that location matters.
While it isn’t a hard and fast rule, residential real estate tends to be valued against comparable properties in the area. If, for example, houses are typically selling for $150,000 on average in a given area, then the house you have your eye on in that area is likely to be worth somewhere in the region of $150,000.
With commercial properties it is different. They tend to be valued on the amount of revenue that the property can generate. There is still some comparing to other nearby commercial properties too, of course, but by and large, the valuation of a commercial property is based on the revenue that the property has generated previously.
As already mentioned at the beginning of this article, the Chilliwack real estate market is a healthy one, and if you need to find commercial properties in the area, then Rick Toor is possibly the best licensed realtor and mortgage broker Chilliwack has to offer. He can listen to your needs, give you a real estate virtual tour of the area, showing you the vacancy listings available, and ensure that your investment is a shrewd and wise one that pays healthy dividends over the long term.