Buying or Selling Commercial Real Estate in Southern Minnesota
Choosing a Commercial Real Estate Agent – Getting Started
Why is hiring a commercial Real Estate specialist different from hiring a residential agent?
Commercial transactions involve income analysis, zoning, CAM expense review, environmental risk, and investor-grade valuations—skill sets residential agents rarely use.
What credentials should buyers or sellers look for in a commercial agent?
Seek a track record of recent closings plus designations such as CCIM or SIOR, and current listings in the asset class you need.
How many commercial deals per year is considered “active”?
Ten or more closings annually over the past three years shows strong market engagement.
Does True Commercial focus only on Southern Minnesota?
Southern Minnesota is the core territory, but a referral network allows statewide and multistate coverage when needed.
How soon should a business engage an agent before a planned purchase or sale?
Six to twelve months out provides time for site searches, pricing strategy, and lease-roll analysis.
What questions should owners ask during an agent interview?
Ask about recent comparables, marketing plans, valuation methods, fee structure, and how due-diligence timelines are managed.
Are dual-agency situations common in commercial real estate?
They occur, but True Commercial prefers single-agency advocacy; any dual agency requires full written consent.
How does True Commercial structure its listing agreements?
Exclusive-right-to-sell listings with transparent commission rates—no junk fees or hidden marketing charges.
Is there a minimum property value True Commercial will represent?
Typical assignments start around $500,000 and scale to multimillion-dollar portfolios.
What distinguishes True Commercial from a national franchise brokerage?
Local business-owner agents know regional ordinances and lenders yet leverage national platforms through the wider True Real Estate network.
True Commercial Expertise & Services
What asset classes does True Commercial handle?
Retail, office, industrial, flex, mixed-use, hospitality, multifamily (five units or more), and development land.
Does the firm perform opinion-of-value reports?
Yes—broker price opinions and income capitalization analyses are provided at no cost for prospective clients.
How are properties marketed beyond MLS?
LoopNet, CoStar, Crexi, proprietary investor lists, targeted e-blasts, drone video tours, and social campaigns.
Can True Commercial coordinate 1031 exchanges?
Yes—through trusted intermediaries to ensure timeline compliance and replacement-property identification.
Does the team assist with site-selection analytics?
Yes—traffic counts, demographic heat maps, competitor mapping, and zoning confirmation are included.
What negotiation strategies set the firm apart?
Data-backed counteroffers, escalation clauses for multiple bids, and creative terms like seller carrybacks or rent bumps.
How is client confidentiality protected?
NDAs, blind summaries, and secure document portals safeguard proprietary financials.
Does True Commercial manage RFPs for tenant representation?
Yes—drafting RFPs, screening landlord responses, and scoring proposals against occupancy-cost targets.
Are environmental assessments coordinated by the brokerage?
Phase I vendors are scheduled and reports reviewed with clients before contingencies expire.
What post-closing services are offered?
Lease-up strategy, vendor introductions, tax-appeal guidance, and six- and 12-month performance check-ins.
Does the company leverage True Land for development deals?
Yes—land specialists provide annexation, platting, and entitlement expertise for commercial developers.
How does the residential arm add value?
The residential division handles executive relocations and employee home-sale referrals, generating cross-channel exposure.
Can clients access an investor network?
A vetted pool of 1031 exchangers, REIT buyers, and local owner-users is maintained.
Is there a technology platform for real-time deal updates?
Clients receive a secure dashboard showing inquiries, showings, offers, and marketing analytics.
How quickly are inquiries answered?
Same-business-day response is guaranteed; urgent questions receive phone replies within two hours.
Buying Commercial Property
What first step should a buyer take before touring properties?
Secure pre-approval or proof of funds to strengthen offers and clarify budget.
How does True Commercial vet on-market vs. off-market deals?
Active listings are mined from CoStar/MLS while owner contacts supply pocket listings.
What inspection periods are standard in Southern Minnesota?
Thirty to sixty days for due diligence, with extensions for environmental or appraisal delays.
How does the firm analyze cap rates?
By normalizing income, verifying actual expenses, and comparing to metro cap-rate surveys.
Are SBA 504 or 7(a) loans common?
Yes for owner-occupied purchases; the firm maintains relationships with preferred lenders.
Can buyers finance tenant improvements?
SBA and conventional lenders may roll TI allowances into loan proceeds.
How are property taxes estimated post-sale?
Assessed-value projections model tax impact on cash flow.
How does a buyer avoid environmental liability?
Order a Phase I, escalate to Phase II when red flags appear, and negotiate seller indemnity.
What insurance coverages should a new owner budget?
General liability, property, loss-of-rent, and EPLI for multifamily or retail centers.
Can the firm recommend property managers?
Yes—specialists in office, retail, and industrial management are available.
How does the escrow timeline differ from residential?
Commercial escrows often run 60–120 days and include lender legal reviews and estoppel certificates.
Should a buyer form an LLC?
Most investors do; counsel should confirm the best structure for liability separation.
How is zoning verified?
Municipal zoning maps and planning-department confirmations ensure permitted use.
What is CAM, and why does it matter?
Common-area maintenance fees influence net operating income; the firm audits CAM reconciliations.
How does the firm evaluate tenant quality?
Rent rolls, credit scores, lease terms, and co-tenancy clauses are reviewed.
Can the buyer add solar or EV chargers?
Feasibility studies and utility incentives are assessed during due diligence.
What ROI target is typical for value-add plays?
Investors often seek 15–18 percent levered IRR over a five-year hold.
Does True Commercial negotiate seller financing?
Yes—down payment, amortization, and balloon terms are customized.
How is market rent verified?
Comparable lease data and broker opinion support underwriting assumptions.
Are lease audits part of due diligence?
Yes—options, escalations, and assignment rights are reviewed line by line.
Selling Commercial Property
What documents should sellers gather before listing?
Rent roll, leases, three years of P&Ls, utility history, and any surveys or environmental reports.
How is asking price determined?
Income capitalization, sales comparables, replacement cost, and current cap-rate trends.
How long are properties on the market in 2025?
Average is 120 days from listing to accepted offer for stabilized assets.
What marketing budget is included?
Photography, drone video, premium CoStar placement, and social boosts are included in the fee.
Do sellers need an appraisal before listing?
Not required; broker opinion is sufficient until a lender orders an appraisal.
How are showings coordinated for occupied buildings?
Tenant-friendly windows, NDAs, and 24-hour notice minimize disruption.
Will the owner pay capital-gains tax?
Usually; a 1031 exchange can defer the liability.
Can the broker coordinate sale-leasebacks?
Yes—rent, term, and escalations are structured for investor yields.
How is confidentiality maintained?
Financials are released only after NDAs; blind listings are available.
What is the typical commission?
Competitive transparent rates with no upfront marketing fees.
How does the firm qualify buyers?
Proof of funds, lender pre-approval, and property-type experience checks.
Are environmental issues a deal killer?
Not always—price offsets or remediation escrows can keep deals alive.
Can the broker coordinate minor repairs pre-sale?
Yes—preferred contractors handle repairs with project oversight.
How are earnest-money deposits handled?
Held in trust; standard deposit is one to three percent of purchase price.
What closing costs does the seller pay?
Title insurance, transfer taxes, and brokerage fee; a net-sheet estimate is provided upfront.
Does staging work for commercial spaces?
Virtual or physical staging helps vacant suites lease or sell faster.
How are offers presented?
LOIs are summarized side by side with net proceeds and contingencies for easy comparison.
Can the seller stay involved post-sale?
Yes—options include retaining property management or minority equity.
What happens if the appraisal comes in low?
Price adjustments or increased buyer equity can bridge the gap.
How quickly are marketing materials prepared?
Full package, photos, and syndication go live within five business days of signing.
Market & Valuation
How often does True Commercial publish market reports?
Quarterly snapshots and annual deep-dive reports on vacancy, absorption, and cap rates.
What factors drive cap-rate changes in Southern Minnesota?
Interest-rate shifts, tenant credit quality, and supply pipeline.
Are tertiary markets gaining investor interest?
Yes—yield-seeking buyers move outside metro cores for higher returns.
How is rent growth projected?
Historical trends, comparable leases, and economic forecasts inform projections.
Does the brokerage track Opportunity Zones?
Yes—map overlays and tax-benefit summaries are provided.
How are land values set for development?
Price per buildable square foot after entitlement analysis.
What exit strategies do investors prefer?
Five- to seven-year holds with value-add improvements before sale or refinance.
Does population growth affect retail rents?
Demographic influx boosts demand and supports rent escalations.
Are interest rates cooling buyer demand?
Higher rates compress leverage but create value-buy opportunities.
How is vacancy trending in industrial space?
Sub-4 percent across key submarkets, supporting speculative development.
Financing & Due Diligence
What loan-to-value ratios are lenders offering?
Sixty-five to 75 percent for stabilized properties; lower for specialty assets.
How early should financing be secured?
Pre-approval before the LOI strengthens negotiating position.
What is a debt-service-coverage ratio?
Net operating income divided by annual debt service; lenders want 1.20–1.35×.
Does True Commercial help assemble loan packages?
Yes—rent roll, operating statements, and comps are compiled for lenders.
How are tenant-improvement allowances financed?
Landlord contributions, amortized rent bumps, or lender TI lines.
Are bridge loans available?
Yes—interest-only bridge debt funds value-add plays before permanent financing.
What contingencies protect buyers?
Financing, inspection, zoning, environmental, and appraisal contingencies with timelines.
How long does underwriting take?
Thirty to 45 days for conventional; about 60 days for SBA.
What third-party reports are typical?
Appraisal, Phase I environmental, building inspection, and ALTA survey.
Who pays closing costs on commercial loans?
Buyers pay lender, appraisal, and legal fees; sellers cover title insurance.
Legal & Paperwork
What documents form a complete LOI?
Price, earnest money, due-diligence period, closing date, contingencies, and broker-fee disclosure.
How is a PSA different from an LOI?
The purchase and sale agreement is binding and details all terms; an LOI is non-binding.
Are attorney reviews mandatory?
Strongly recommended; brokers draft PSAs and attorneys finalize them.
What is an estoppel certificate?
A tenant-signed statement confirming lease terms and current rent.
How are lease assignments handled?
Sellers obtain tenant consent and deliver signed assignments before closing.
Who orders title work?
Closing agents or attorneys coordinate title insurance and lien payoff.
What is zoning compliance documentation?
A city letter or certificate verifying property use.
How are prorations calculated?
Taxes, rents, and CAM charges are prorated as of closing.
Do electronic signatures count?
Yes—e-signature platforms are enforceable in Minnesota.
How long are files retained?
Digital deal files are stored for at least seven years.
Closing & Post-Closing
How soon after closing can a buyer occupy?
Immediately, unless a lease-back or hold-over agreement is in place.
What post-closing deliverables should the buyer receive?
Recorded deed, ALTA policy, settlement statement, and original leases.
Can True Commercial help appeal property taxes?
Yes—introductions to tax consultants and support data are provided.
How does the firm track ROI after purchase?
Annual reviews compare actual NOI to pro-forma projections.
Does True Commercial offer ongoing advisory services?
Yes—portfolio expansion, refinancing strategies, and disposition timing analyses maximize long-term value.