Commercial Broker unwilling to let competition Represent Seller

8 Replies

A friend of mine and I are looking at a commercial real estate property listed through Real Estate 7 brokerage in Devils Lake, ND. My mother in Law is a licensed real estate agent at a competing brokerage. I  initially stopped in at the business to introduce myself and tell them I was interested in the possibility of purchasing the business as long as I could have my mother in law represent me as the potential buyer. She (The owner) said she had no problem with that, but when I had my mother in law contact the agency(Real Estate 7)they said they would not allow it. What do I do from here?

You did all the leg work and found the property by yourself, or did your mother-in-law do any of the work?

Sign a buyer's agency agreement with your mother-in-law and pay her the commission yourself if you feel she needs to be compensated for no participation in the deal.  Or, you could offer to increase the sale price to cover the commission.

I've run into this in the past when selling as FSBO/Agent. I'd have someone come through 3 times without ever mentioning or seeing their "agent", then come back to make an offer and say they have a "friend", or whatever, who is a real estate agent and would like for them to write the deal and get a commission.

I simply tell them I have no problem, but their price just increased to cover the commission and cut in price I'd take for pulling the rug out from under me.

Want it that bad? 

Best of luck.

Thank you for the advice Dan! I did do all the leg work myself. My issue is besides the fact my mother in law is an agent; the brokerage that listed the property is not a reputable company. One in which I refuse to let represent me as a potential buyer; besides the broker is best friends with the property owner and how should I expect him to have any of my interests in mind? Is it normal for a brokerage to refuse to let the potential buyer be represented by his own REA?

It's commercial, so your agent will likely need a commission sharing agreement executed by her and the listing broker.

The listing agent is unwilling to sign an agreement to share the commission. Is this out of the ordinary? This is my dilemma. I don't want to business with the listing agent for numerous reasons.

Thank you @John Cohen . What would your advice be from here? Deal with it or forget about the property. Or is there a possibility of being creative and finding a way to not deal with the Brokerage.


an old saying keep your friends close and enemies closer you know how their coming get the deal done! !!!

Seth your initial post is confusing. You say you are buying a business. That is business brokerage and has nothing to do with real estate.

Sometimes they might be selling the building with the land and the business and that will include a real estate component. How the physical asset and land is valued is different than buying the assets of a business.

To get information in the beginning of a commercial transaction the listing brokerage usually has the buyer sign a CA agreement. This is a confidentiality agreement. This spells out the information will not be shared with competitors or other parties not directly involved with the transaction etc. Also mentioned generally is whether you are represented or not and you sign a statement that if you are not then if you bring in an agent later YOU will pay for that commission.

This is why it is important to sign the right CA upfront that you are represented. Usually the buyers broker signs it and gets the buyer to sign a commission will be paid by the seller etc.

A listing broker can still get both sides of the commission if the buyer isn't represented by being a transactional broker capacity or representing one party as a client but performing ministerial acts only for the other party as a customer.

Each state has it own little laws on what is acceptable or not for representation.

You could have your family member write an LOI to submit. In it have the seller paying XX commission at closing as a condition of closing. This way when you move to purchase and sale the seller can't play games with the commission later on. Even though LOI's are generally non-binding the ones I use have certain parts binding on the seller.

No legal advice given.      

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