My clients don't always like to hear it, even if they appreciate it. More than ever in today's economy, it takes an extra and a different type of effort to sell a high end or investment property, whether residential or commercial. The days of "here it is, come and buy it" are long gone.
One of the networking sites I frequent had a post from a realty agent I do not know and had never contacted before to the best of my knowledge. He basically announced that the property is for sale and linked to its web site as well as to another version of the listing on a commercial property listing service.
This is for a waterfront restaurant and property in Rhode Island, with the web site he gave being WaterfireDining.com.
My curiousity got the best of me. In better times (as in a few years ago) I did extensive market research to prepare brochures and presentations on a waterfront restaurant in Indiana, and a family owned restaurant in Wisconsin, among others. And this Rhode Island property is priced higher than those I have worked on. I decided to visit the site as if I were a potential investor.
I don't often quote myself in an article, but in this case, it gets my point across. This agent asked for comments, so after visiting the links he gave, here is what I replied with:
"Don - the site and the listing impressed me but didn't "sell" me on why it would be a good investment. (OK - I'm not an investor and don't play one on TV, but I do point these things out to realty agents who are already my marketing clients.) So far I want to eat there rather than buy the place, and that isn't your intention. There is nothing to show a potential buyer why he/she/they should spend over $2,000,000 on this property. Why is it a "former" restaurant? That would potentially scare me off before I would contact you about it. I could go away thinking it has been closed for years and you are still another agent trying to unload an overblown listing. Or, I could come away thinking that it just closed due to insufficient financing in a challenging economic time and that someone could get a good deal if they open it again by the end of the year. And if I had over $2,000,000 for an investment, I'll think the worst of an opportunity. And all the photos in the world don't answer that important question for me. Also, it is located near a major college campus. But is it a place that students go and hang out? Unless I know it is, the proximity to campus doesn't necessarily sell me on this as a good investment. If the students do not frequent the place, the location could be more of a negative than a positive. But I don't know either way. This looks to be another instance where "reasons and benefits" should come before the pictures, bells, and whistles. The site and the listing do not tell me why I should invest in the property."
In other words, I only got part of the overall picture. That part I can understand, but my entire point is that I got the "wrong" part.
This, like thousands of others, is an investment property. Potential buyers are not going to compare it to other restaurants or buildings. They are going to compare it with other potential investments. The potential buyer for this property may not care if it is waterfront, in a college town, or in the middle of a swamp near New Orelans. That potential buyer wants to know, first and foremost, how he/she/they can serve their purpose by purchasing the property.
That purpose could be specific to wanting to own a restaurant, expanding a college town or coastal restaurant concept, starting a family run business, a plan to establish and then re-sell in five years for a hefty profit, or as a tax shelter to pour some money into "improvements" for.
Yet, the majority of the points raised in the previous paragraph were not addressed. I'm sure that those of you who are realty agents are saying to yourself "Of course not, that's why you need to contact me!".
And that's where I come back with my explanation that times have changed. If I am considering an investment of more than $2 million, I am just as likely to say "next!" and look for another possibility as I am to contact the agent and have to give out information before I can get answers to what really are qualifying questions.
If I really was a potential investor in this property, a visual presentation (and I consider a dedicated web site to be one of them) needs to start me up with more important information.
The presentation needs to answer the questions that an investor or investment group of this magnitude needs answered. Like the questions I raised in my response to Don the agent.
Then, if I am still interested, I'm sure I'd be impressed by the pictures.
Now, I'm sure that Don and many other agents I talk to want to tell me that this disappoints them because by doing it the way I suggest they will not be contacted by as many potential buyers.
I disagree. This is not just another condo in a 20 year old development. This is a serious investment property. As an investor of this magnitude, I would be well versed enough to take note that a realty agent has started off by targeting the most important factors. Even if he/she did not target my specific needs, I might still be tempted to contact him or her. Why? Because it would come across that this person understands the marketplace and likely could address my specific need. Or know enough to refer me to someone who does.
Sell the sizzle, and not the steak. At this level of investment needed, market the property and not the agent.
Let me assure you that I am not here to attack agent Don or the property one bit. This is what I would tell him if he were my client. But I will also tell you that in the first 6 days of Don's post about this property, mine remains the only response, and I haven't heard from Don about it either. And the property is still for sale.
Places in Time III
1 day ago