A couple of weeks ago I almost elevated my landlord status to the next level and became an even bigger ‘landlord wanker’ by scooping up my first commercial property. The Lord knows there’s nothing worse than an arsehole landlord with ambition in the middle of an economic meltdown. There’s people out there increasingly feeling the pinch and knocking-back shots of their own saliva just to clench their thirst, while I’m sniffing around my loose-change jar, trying to diversify my portfolio. If it wasn’t for the motivational and profound words of 50 Cent the guilt would have probably killed me. “Get rich, or die tryin'”
When I say “almost elevated”, I really mean no such thing, but it’s the closest I’ve ever danced with the idea. I simply viewed a commercial property that ever so slightly piqued my interest. A 3-story, 5,000 sqft, freehold property, in a small industrial estate in a quaint rural village on the outskirts of London.
There for the taking!
The location was good, the price was extremely appealing, and there was scope to stick a blade into the corpse and gut the Mo’fo into pieces and end up with a property that compromises multiple units. It’s currently being occupied by one company, which from what I could gather is facing financial turmoil and going down the shitter- although that was never confirmed. But I met the vendor during the viewing and he threw around the word “downsizing” and notably said, “everyone is selling online these days”- I could also see a glimmer of hope in his eyes when he looked into my innocent eyes. Perhaps I was his saviour. Imagine that. Worrying. If I’m the beacon of hope for anyone during any situation, it’s safe to assume they’ve hit rock bottom.
I got the impression that while everyone in their industry moved with the times and embraced the digital age, he was busy faxing his invoices and carving his accounts on rocks. Needless to say, this guy’s poker-face was dog-turd and crumbled from the moment he saw me. He needed me.
I wasn’t actually in the market to buy (and I’m still not), but my interest was triggered by an unsolicited and random search for commercial properties in my local area on Rightmove. Unexpectedly, this one property caught my seductive little eye because it was located 5 minutes away from my doorstep and the asking price didn’t want to make me top myself, so taking a gander didn’t seem like a huge gamble. On impulse, I contacted the estate agent and arranged a viewing for that same afternoon.
On arrival I was greeted by both the estate agent and the vendor. They seemed like nice enough folks, although the agent looked like a minor that jacked off to Star Trek. Nonetheless, nice enough, very pleasant. Eager.
I spent about an hour looking around the inside of the property; taking measurements, calculating the costs of converting the open space into separate units, estimating the returns, and asking bullshit questions for the sake of it, just so I looked like a serious guy. It was all about perception.
The Agent’s dribbling sales patter!
In my head, it all made sense and it seemed like an exciting opportunity. Of course, it made even more sense to the estate agent, which was made abundantly clear by his constant need to narrate how much of an amazing opportunity lays before me… throughout the entire damn viewing.
“Oh, that space would be perfect to split into an office unit”
“Look over there, that’s a nice bit of open space- lots of natural light coming through”
“it’s useful that there’s toilets on every floor”
14 days later… I can still hear the rat-weasel screeching against my eardrum and masturbating all over it.
Unfortunately, he wasn’t actually telling me anything about the property that I couldn’t already see for myself. He was just cheer-leading, and I generally hate the ‘hype’ tactic, where I’m fed pointless/meaningless sales patter. I’m not an idiot, I don’t have impaired vision, there wasn’t a dog attached with H.V. strips next to me, and there was nothing complicated about the open space in front of me, so I didn’t need the droning mutterings of an estate agent telling me there’s natural light coming through a window that’s 1 meter in front of me. I can see, ok?
But he was fine, he was just doing his thing. Like I said, nice guy, just a bit of a harmless twat.
I’ve always believed that an over enthusiastic approach and/or hard-sell isn’t practical or appropriate when you’re trying to flog property because it involves too much money, and it’s unlikely that you can force someone into parting with that much cash unless they genuinely like the product. It’s not in the same ball-park as selling a shitty Sanyo TV, where the salesman can give you an erection by enticing you with the prospect of a home entertainment centre that delivers crystal clear porn and 7.2 Dolby surround sound, all in exchange for a couple of hundred pounds. What the hell, maybe he’ll throw in a couple of DVDs with the deal. SOLD! It’s tough to always be closing with property- there’s too much at stake- you can’t force it with meaningless cheer-leading and give-aways.
Despite the futile ramblings I was forced to endure, I was interested in the property, which was actually worrying because this investment would push me deep into the red. I sure as hell don’t have money lying around- my Louis Vuitton man-bags didn’t grow on trees. Consequently, I probably would have been forced to try and sell you guys some advertising space or some other kind of retarded junk. So fair warning, if in the coming weeks I release a new eBook on the subject of ‘The correlation between an appealing front-door colour and tenant interest’, you know why.
Ok, onto the (problematic) prospect…
I figured I could split the property into 6 separate units, which could very comfortably hold about 6 people each. The rental yield seemed healthy, although the figures were purely conjecture at this point. But I figured I wasn’t far off, because I knew the going rates in the local area.
After I had taken a good mooch around the office space, we stumbled onto the issue of the legal boundaries of the premises. I was particularly interested in the parking spaces. Bear in mind, we’re talking about a 5,000 sqft property, which was going to accommodate approximately 36 people. Let’s say 20 of those people required parking space (even that’s being conservative) and I also need to take into consideration visitors, so that totals to quite a lot of parking space.
When I initially walked into the premises I did notice a lot of cars surrounding the building, and I also saw a lot of signs dotted around the car-park which had the company’s name on, so it seemed like they had legal ownership of many of those spaces. However, the building is mid-terraced, so it wasn’t entirely clear where the boundaries were.
I posed the question, “how many spaces does this place come with?” The estate and vendor looked at one another (they didn’t really, but I added that for drama- I want this to be an experience for you), and the specky little rat-weasel muttered, “4 spaces, but there’s plenty of space”.
I wasn’t quite sure how 4 parking spaces equated to “plenty of space”- but I was all ears, eager to learn.
I was pretty surprised by the situation because I saw at least 15 workers in the building, that’s not accounting for anyone that may have been taking a dump or masturbating in the stationary cupboard. Plus, there was still the mystery of all the company signs in the occupied parking spaces, which led me to ask my next question…
What’s going on, geezer?
The vendor chirped up and said, “over the years we’ve stamped our company logo on various spaces that look like it’s part of our building, so no one would dispute it. The spots we claimed actually belong to National Rail (there was a train track opposite the property), but we’ve never had an issue”
Thanks for the honesty. But still, hijacking parking spaces doesn’t seem like a viable business plan to me. Alarm bells. Ringing. Loudly.
Regardless, after adding up all the legal and illegitimate spaces, they still fell short, massively. I think they had about 11 spaces in total. This was a major concern, and pretty much demolished my plans in one foul swoop. A practical and legal parking solution in a rural town (we’re not talking Central London here) where everyone pretty much drives is crucial for commercial premises.
Hypothetically speaking, if I purchased the property and continued to use those hijacked spots, there was nothing stopping National Rail popping along one day and telling me to sling my hook. If that were to be the case, I would have been royally fucked.
It started to make sense for why the price was so appealing. I’m sure others viewed the property and had the same concerns, and were never to be seen or heard from again. That was certainly my new plan. 4 parking spaces for a 5,000 sqft property? Seriously, bruv? Impractical was an understatement.
I then asked how long the property had been on the market for, I was told 14 months. I have a feeling the vendor will be holding onto that place for the unforeseeable future unless he practically gives it away, but I didn’t say it out loud, he already looked lifeless at this point. The reality is, which I’m sure the agent and vendor is aware of, a property of that size with such limited parking space is just way too impractical for any sensible use. It’s a shame though, the actual property is decent.
The Agent’s unbreakable spirit!
Despite my obvious drop in enthusiasm, the estate agent kept his spirits high (as expected) and kept re-emphasising everything right about the property. There was no destroying the guy’s dribbling hype. He kept recycling the same lines: the potential, the vast open space, the perfect opportunity to split the space into various units etc. The fact that I had 4 legal parking spaces to accommodate 36 people (plus visitors) didn’t seem to phase him or his spirits. But then again, why would it? He doesn’t give a flying-fuck if this place drags me into bankruptcy and results in me rummaging around his bins for leftover Subways.
Out of curiosity, is that a genuine sales-tactic? Are agents trained to focus on the positives and completely ignore the problems? I mean, don’t get me wrong, I understand the philosophy behind it. I’m just curious.
Convinced I had stumbled upon the opportunity of a lifetime, he stayed true to his sales patter with conviction, all the way until I walked off into the sunset…and then after, via several follow-up phone calls and e-mails. I’m surprised he didn’t Tweet me.
I don’t know if he was actually dying on the inside, but I imagine continuous knock-backs eventually take its toll, and are often a catalyst for desperation and self-harming. However, on the surface, he was adamant the property was still perfect for my intended purposes, despite my best efforts of making him understand that the proposition he’s offering me is dogshit. I’m sure if I pitched the idea of buying a minibus to start a shuttle service, which provided early morning pick-ups and after work drop-offs for all the employers, he would have sucked my nuts and praised my ability to solve problems.
At the end of the day, I don’t hold any resentment towards the agent, he didn’t overly bother me because I know he was just doing his job, and I appreciate that. I’m not the client, the vendor is, and he’s just working his greasy arse off to the bone, trying to close the deal for him. Unfortunately, he won’t be closing the deal with me, but “a fool and his money are soon parted”, so I’m sure he’ll eventually find some chump to close the deal with. Don’t be that chump.
Moral of the story? The agent isn’t working for the buyer, the agent is working for the seller, so it’s his job to sell YOU an impractical piece of shit! But it’s our job, as the buyer, to know better.
Disclaimer: I'm just a landlord blogger; I'm 100% not qualified to give legal or financial advice. I'm a doofus. Any information I share is my unqualified opinion, and should never be construed as professional legal or financial advice. You should definitely get advice from a qualified professional for any legal or financial matters. For more information, please read my full disclaimer.