In today's uncertain market, your strategy and approach to marketing an asset can significantly impact your outcome. Over the past two years, we have helped owners and sponsors navigate these complexities and achieve optimal results.
Generally speaking, there are two primary approaches for marketing an asset: a broad approach or a highly targeted approach.
Broad Marketing Strategy:
The broad marketing strategy is the traditional process most advisors will follow, leveraging a combination of marketing platforms, such as CoStar and Real Capital Markets (RCM), and working with existing relationships. The process generally consists of these phases:
Packaging Period (4-6 Weeks): This is the preparation phase of the project, from ordering photography and videos to crafting compelling teasers and offering memorandums.
Marketing Period (4 Weeks): Here is when the marketing begins, launching the teasers, emails blasts, calling campaigns, answering questions from interested buyers, and commencing property tours.
Bidding Period (2-4 Weeks): Soliciting initial bids, uploading due diligence materials, evaluating second-round bids, conducting buyer interviews, and ultimately selecting the buyer.
Closing Period (5-8 Weeks): Negotiating purchase agreements, commencing buyer due diligence, and closing the transaction within 15-30 days after the due diligence period concludes.
In markets with high transaction volumes, broadly marketing a property can be advantageous. It allows for the identification of all potential buyers and fosters healthy competition, potentially driving up the final sale price.
Targeted Approach:
Opposite to broadly marketing an asset, in a targeted approach, the broker selects a limited number of investors who would be interested in the specific asset, have access to funds, and are capable of closing the transaction.
By keeping the buyer pool small and confidential, sellers may achieve higher pricing due to the absence of valuation discussions between buyers and other market participants. This is especially true today with office and mixed-use assets, where transaction volumes are light, and while we are still going through a period of price discovery.
The targeted approach also simplifies and streamlines the process and may result in a quicker close.
As the market continues to evolve, it's crucial to adapt your disposition strategy accordingly.
Feel free to reach out to talk more about your unique situation.