If you don’t have the most recent ALTA survey and Phase 1 environmental report, you should complete them before marketing begins. This comes with an understanding with each respective engineer that the reports will be updated for the benefit of the buyer for a nominal charge.
Know whether your sale will require the buyer to assume your existing financing or secure a new loan. You may want to require your buyer to demonstrate his ability to actually obtain the financing needed to close the deal. You can accept a lower offer if it’s all cash or if the buyer can prove his ability to get a loan.
You or your broker should contact a number of prospective lenders so you’re prepared to provide whatever documentation a lender may require to process the buyer’s loan application as quickly as possible. The probability of a smooth and timely closing will be improved if you can provide your buyer with specific lenders’ names and phone numbers.
If there’s an exiting loan that can or must be assumed, you should know what it takes to accomplish that and be prepared to share that information with the buyer. The process of assuming a securitized loan is very difficult these days. Find out what’s involved and make sure your buyer knows, too. If there’s an existing loan that will have to be paid off, know what it will cost to do that, if anything, and be prepared to deal with that as well.
Although there may have never been a better time to sell a self-storage property, it’s still important to plan your work and work your plan.
Bill Alter has been a self-storage specialist with Rein & Grossoehme Commercial Real Estate in Arizona since 1986. Along with business partner Denise Nunez, Alter has been responsible for the sale of more than 100 storage facilities, totaling more than 6 million square feet and $225 million. He can be reached at 602.315.0771; e-mail email@example.com.