Pocket Listings

       

Pocket Listings   

 

A fellow realtor referred a client to me recently, and told his client that he should establish a good relationship with a commercial realtor, if he is interested in finding out about the best deals that come on the market in our area.  This new client was told “most of the good deals don’t even get listed on the MLS”.  When I heard this, my first thought was, ‘I put all of my listings on the MLS’.

 

Then the client started telling me about what they were looking for.  He was looking for investment property or a business that cash flowed and I couldn’t find much for him in the MLS.  I went through old notes of people who I had previously spoken to about selling but who had decided not to list their properties at the current time.  This is a group of people that have told me they would sell their property if I had a buyer, but they did not want to list it for sale.  This is known in the industry as a “pocket listing”.  I was able to put together a much longer list of possible acquisitions for the client and realized that, quite often, sales do happen this way.

 

I’ve decided to share with my readers some basic information on a few of the properties, which are not listed for sale, but I think are desirable properties and currently hard to find on the market.  Here’s the short list of my favorites:

 

A 24 unit multi-family development centrally located in Traverse City.  It is fully rented and has good cash flow with a 6.5% return on existing income.  That is a good rate for apartment buildings, but this also has room on the site for an additional 12 units to be built.  Making this deal even more enticing, is that the rents are under market rent, so a new owner has an opportunity to significantly increase income as leases come up for renewal.

 

Another hot area is downtown commercial property.  There have been 5 sales that I know of in the last year and none of the properties were listed for sale.  Recently I spoke with the owner of a building in downtown that does not want to put it on the market, but said they would sell if offered close to the amount of money they have put into the building.  It’s a two story building that’s been completely remodeled and is in a prime location.

 

Retail strip malls have had a hard time the past few years but are poised to make a comeback as the economy continues to gain strength.  I know of one for sale on Garfield Ave that is 17,000 SF, one on South Airport that is 20,000 SF and one on Division (US-31) that is 40,000 SF.  The owners are willing to sell with current returns running 5-9% on existing income and the ones with lower returns have upside potential of adding additional tenants and income.

 

If you know of anyone interested in these properties, please have them contact me.  Other properties for sale include a 50 room hotel, a 10,000 SF industrial building leased to tenants, an 18,000 SF industrial building that is vacant and an acreage parcel in the city limits zoned to allow 200 apartments. If there is something special that you have been looking for, let us know and we will search to see what we can come up with to fit your needs, even if it’s not currently listed.

 

Currently I am finalizing a lease with a customer that was looking for a 5,000 SF warehouse.  This has been a very tight part of the market recently and we couldn’t find a single one in Traverse City that was on the market.  I was able to come up with 2 properties that were not listed and worked for him.  We are negotiating the lease on one of them now.

 

Dan Stiebel, CCIM

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Dan Stiebel

Dan Stiebel

Associate Broker
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