I’m a Specialist Broker - Here’s What I Do.

I’m a Specialist Broker - Here’s What I Do.

There are many similarities between specialist and generalist business brokers. We all appraise, list, and market businesses for sale for our Sellers. We all find, qualify, and procure offers from our Buyers. And we all negotiate the terms and conditions of the sale to achieve a win-win scenario for both Buyer and Seller. But as a specialist, there are distinct and nuanced differences in each of these areas. 

I specialise in the sale of rent rolls and real estate agencies across Queensland. When appraising a rent roll for sale, there are many factors that need to be taken into account that are specific to rent roll transactions, such as the location of the properties in the rent roll, the level of landlord ownership in the rent roll, arrears and vacancy rates, how long the properties have been under management with the agency, the reason for the sale and the Seller’s intentions after the sale, as well as the earnings and where they sit amongst industry averages.

Multipliers for rent rolls are attributed to the projected earnings of the coming 12-month period on the assumption that all properties in the rent roll will be fully let during that time. I don’t use EBITDA or PEBITDA or any other valuation methodology when appraising a rent roll.

Buyers for rent rolls are almost always established real estate agents who are looking to grow their own portfolio, so marketing a rent roll for sale requires a select, targeted database of Buyers who are already established with several years of experience behind them and a stable rent roll of their own that can be used as equity for the purchase. Real estate agency sales that are conducted on a walk-in-walk-out basis will also require Buyers that have the relevant industry licenses and appropriate experience in the industry. 

Due to the nature of these businesses and the industry they are in, confidentiality is paramount to Sellers and I am often instructed to list a business for sale off the market and try to secure offers from Buyers without going to the open market and advertising through the usual channels, so my database of registered and qualified Buyers is invaluable for finding a Buyer under these circumstances.

For most Sellers in the real estate industry, the right Buyer is not just about the price that is being offered. Sellers have invested their time, effort, and money, and have often made great personal sacrifices to build their business to its current state. The emotional investment they have in their business means that the right Buyer for them will lie in their ability to fulfil a certain need of the Seller’s: are they a local agency, are they franchised or independent, what is the history of the Buyer, are they a large agency or a boutique agency, will the staff be remaining with the business, are they property management only or a full service agency? Often the Buyer’s aspirations and credentials will mean more to a Seller than the dollar value.

of transactions. A specialist broker will understand the implications of these conditions and what they mean for both parties, which is necessary to ensure that the broker is negotiating for their Seller with their best interests in mind. 

The benefit of using a specialist broker is that you are dealing with an expert that is accustomed to the terms, the conditions, the processes, and the timelines that are specific to this particular industry. They have registered, qualified Buyers who are looking for your exact kind of business and aren’t simply shopping around. Specialists have a network of solicitors, finance brokers, and valuers that all understand the characteristics of the transactions they are dealing with and who your specialist broker can work closely with to ensure the best outcome for all involved. 

A specialist broker will keep up to date with industry trends and legislative changes that may impact on the sale of a business in this industry. And because they deal exclusively with a particular kind of business day in and day out, there are generally no surprises – their own experience and that of their professional network will usually help them to resolve any issues or overcome any hurdles that arise along the way, allowing for a great result for everyone.
 

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