A Statement On Ukraine from Kevin Maggiacomo, SVN President and CEO

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Big Commissions in Government Contracts and Bankruptcy

Editor’s Note: This blog post is part of SVN’s August focus on Accelerated Sales, and was submitted by David E. Gilmore, CCIM, CAI, AARE  and Louis Fisher III, CAI.

The commercial real estate market is always changing,  and each SVN Advisor should consider every area of possible sales and income. Following we discuss two segments of the market that most may not have considered but which often lead to big commissions: government real estate auctions and bankruptcy auctions. Following are case studies to illustrate how these work.

Government Real Estate Auctions: SVN Alta Commercial and UDOT

CASE Chet Barber, Managing Director, and Tia Shim, Esq. of SVN Alta Commercial in Salt Lake City, Utah had a client relationship with the Utah Department of Transportation (UDOT) and heard about an upcoming Request for Proposal (RFP) for Real Estate Auctions. Chet immediately called in David E. Gilmore, CCIM, CAI, AARE and Louis Fisher III, CAI of the SVN Accelerated Sales Team to review the RFP. Dave and Louis put together an 85-page proposal illustrating the team’s ideas and qualifications  and  how local market experts, SVN Alta Commercial, would be integrated into the team. The combined team made it to the oral presentation phase and won the five-year contract to provide auction services to UDOT.

In the first six months of the contract the SVN Accelerated Sales/SVN Alta Team held two online events, offered 27 UDOT properties, closed 10 properties for $7.8 million, and had another 14 properties under contract for more than $10 million. And, the third and fourth online auction event are schedule to happen before the end of the year, and it’s only the first year of the five-year assignment.

Bankruptcy Auction: SVN Miller Commercial Real Estate’s Retail Client

Bankruptcy is a fact of life, and it could affect your clients. However, bankruptcy doesn’t mean that you necessarily lose the listing.

Brent Miller, CCIM, CPM of SVN Miller Commercial Real Estate in Salisbury, Maryland was the property manager of a Class A neighborhood retail center with national anchor tenants such as Outback Steakhouse, Chico’s and Talbots.

Once Brent was notified of the shopping center’s Chapter 7 filing, he contacted Louis Fisher and Dave Gilmore to make a proposal to auction the property for the Bankruptcy Court.  The combined team of SVN Accelerated Sales and SVN Miller submitted the proposal, won the assignment, then conducted a live auction with simultaneous online bidding in the bankruptcy courtroom. With four bidders in the courtroom and five bidding online, the auction began at $4,200,000 and quickly rose to the final sale price of $5,925,000 which happened to be $1,325,000 more than the appraisal.

The bottom line

SVN Advisors should be aware of solicitations and RFPs for auction services from local municipalities and states. They should also be looking for bankruptcy opportunities.

SVN’s Accelerated Sales team has recently won contracts with the FDIC, UDOT, State of Rhode Island, State of Louisiana Land Trust, State of Michigan, and 18 Bankruptcy Districts across the United States.

 

5 for Friday Double Header: David Gilmore and Louis Fisher of SVN Auction Services

We are posting August’s Five for Friday early to give you enough time to read our double-header! Since SVN is focused on Accelerated Sales and Auctions in August, this month we feature Louis B. Fisher III , CAI, National Director and David E. Gilmore CCIM, CAI, AARE, Marketing/Operations, Managing Director, who are both part of the SVN Auction/Accelerated Sales Services team specializing in government auctions and bankruptcy.

 

 

What advice would you provide to an aspiring advisor who is new to the industry?

Fisher:  I’d give two main pieces of advice. First, choose a successful mentor to shadow. And second, learn the power to say NO to clients with unrealistic expectations

Gilmore: I also have two pieces of advice. Number one is learn good sales techniques for the real estate business. And number two is to hire a coach.

 

What does the SVN Difference mean to you?

Fisher: Collaboration, and ability to have doors opened to opportunities otherwise not available.

Gilmore: It means an international group of professionals collaborating and sharing, all for the benefit of the client.

 

What learning tools (book, blog, website, etc.) would you recommend to your colleagues to further their knowledge and enhance their careers?

Fisher: Attend SVN’s Annual Conference every year. It’s invaluable for learning and making connections.

 Gilmore: I recommend the Sandler Sales Institute’s books and programs. Sandler teaches you how to ask questions, find the prospect’s pain, and close the sale. And, get into a Vistage group.

 

What was your most memorable deal and why?

Fisher: It was a contract that came from the State of Utah Department of Transportation to sell all state-owned surplus parcels through a newly created online auction program with the entire legislature’s support. The development of this program has created a successful public and private partnership not ever seen previously.

 Gilmore: Mine was in August 2005. I auctioned an office building in New Orleans on Friday for $800,000. I then evacuated to Tunica, MS for the impending arrival of Hurricane Katrina on Saturday. On Sunday, I flew to Michigan to help Louis Fisher auction a $31.5 million former psychiatric hospital for the State of Michigan. Meanwhile, I watched Katrina flood my hometown. After, I lived in a casino hotel for three weeks while working on a $10.8 million auction in Oklahoma City. Both good times and bad times, but certainly memorable.

 

List a fun fact to share about yourself – something that people may not know and that they may be surprised to find out.

Fisher: I played two years of collegiate basketball, and never saw a shot I didn’t like or wouldn’t take.

 Gilmore: I have always had a desire to be a rock and roll drummer. When I was about seven years old, my dad said, “We can afford to buy you a drum or a set of shoulder pads for football.” I chose the shoulder pads. It was a good decision, as football paid for my college degree. Many of you that know me probably think I played too many games without a helmet, but that’s another story…..


Develop your career in commercial real estate with SVN. Check out our career opportunities.

Tuesday Tip: Add Accelerated Marketing to Your CRE Toolbox

August is Accelerated Marketing/Sales Month here at SVN, and today’s tip comes to you from David E. Gilmore, CCIM, CAI, AARE, national auctioneer and managing partner for SVN | Gilmore Auction & Realty Co. David is an integral member of the SVN Auction Services and SVN Asset Recovery Teams.


Did you know that…

Many municipalities (i.e., cities, counties, school districts, states, housing authorities, etc.) by law, must sell their real estate using auction/accelerated marketing?

In some instances, the municipality will award a multi-year contract for these real estate auction services?

It’s the law because auction has been universally recognized as a fair and transparent method to sell real estate. Everyone has the opportunity to bid and buy the property, not just a select few.

Here are some tips for you to take advantage of accelerated marketing:

  • Read your local/regional newspaper or online news publication and look for ads or legal notices that contain:

          -RFP (Request for Proposal) for real estate auctions

          -Request of Qualifications (RFQ) for real estate auctioneer

          -Auction of surplus real estate

  • When prospecting, contact your state land office, Dept. of Transportation, or City Council member and ask how they sell their real estate.
  • If an RFP/RFQ is available, immediately contact the SVN Auction Services Advisors who specialize in government contracts: Louis B. Fisher III, CAI and David E. Gilmore, CCIM, CAI, AARE. Call or email ASAP as most RFPs usually require a proposal within a very short time frame.
  • Make sure that your bio/resume is up to date, as you will be featured in the proposal as the local CRE expert and the headquarters broker/advisor.

Here’s the bottom line: Accelerated marketing/auction can be that “extra CRE tool” that makes you big commissions.

Top Reasons to Sell a Property Using the Auction Method

Why the Auction Method is Something to Consider

If you’re interested in selling a property “as is, where is,” the auction method is typically the way to go. Instead of marketing a property with a set listing price in a negotiated sale, some sellers opt for the time-sensitive format for a variety of reasons.

Auction sales can work in the seller’s favor by giving him or her more control over the process. After all, the seller gets to set the terms and conditions of an auction sale. Selling a property at a true market value is arguably most feasible using the auction method, and a property can sometimes end up selling at a higher price in an auction than in a negotiated sale. Three of the biggest auction format upsides have to do with timing, exposure, and financing.

Top 3 Reasons to Try the Auction Format Instead of a Negotiated Sale

  1. The auction method speeds up the process. Because an auction is a time-sensitive sale with a set date, this format creates a sense of urgency among potential buyers. Compared to negotiated sales, auctions stimulate a need for informed buyers to act fast, encouraging competition. It may be assuring to the seller, who knows exactly when the property will sell. In negotiated sales, the seller has no idea when the sale date will arrive – it could be any number of weeks or months after the property is listed. The accelerated timeframe in the auction method means the seller enjoys a 30-45 day unconditional all cash closing. To top it off, all due diligence, inspections, and testing is performed prior to the sale.
  2. The auction method increases exposure. Using the auction format ensures an aggressive marketing program, which is accelerated due to the limited timeline leading up to an auction. This accelerated marketing strategy can leverage the seller’s advertising investment 10-20 times in a multi-property event. Since auctions involve a large number of pre-qualified prospects, this aggressive exposure in an auction marketing campaign means the property is advertised to people who are truly serious potential buyers.
  3. The auction method cuts costs and may increase value. The speedy process involved in the auction method reduces carrying costs, which include taxes and maintenance. Auctions also require potential buyers to pre-qualify for financing, meaning the sell-side agent does not have to waste time (and money) dealing with those who are not “true” potential buyers. Compared to negotiated sales where the asking price is essentially the highest amount the seller will be able to get for the property, the sky’s the limit for properties sold through the auction method.

Over all, auctions are worth considering, especially if the seller wants an accelerated timeframe, increased exposure to qualified prospects, and certain financial upsides that the auction method can provide.


SVN Auction Services is a provider of date-specific sales and special asset solutions. It encompasses an elite group of local and regional auction Advisors throughout the United States who specialize in areas such as foreclosures, tax sales, multi-properties, receiverships and bankruptcies. SVN Auction Services offers the industry’s most comprehensive spectrum of auction solutions—from rapid asset resolution and 30-day countdown asset sales to wide area and high impact/high promotion events. As part of one of the most recognized and reputable commercial real estate firms in the industry, SVN Auction Services is supported by SVN International, which features more than 190 locations serving more than 500 markets. For more information, visit SVN Auction Services.

This blog post was adapted from the SVN | Menish Auctions website

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