Commercial real estate brokerage: a world in itself

The professional authorized by the OACIQ who acts in commercial brokerage carries out the purchase, sale or rental of commercial buildings, warehouses, offices or land for industrial or commercial purposes. Framed by the Real Estate Brokerage Act , he had to pass an entrance exam into the profession before obtaining his license to practice. In addition, he is required to follow several training courses as part of a continuing education program developed by the OACIQ.

While you continue to conduct your business with peace of mind, the real estate broker:

• analyzes the market (competition, strategic location, rental policies, buyer or seller behavior, etc.);

• finds opportunities for you to buy, sell or rent commercial or industrial premises;

• helps you determine the most advantageous price;

• tracks your transaction until completion.

The Big Differences Between Residential Real Estate Brokerage and Commercial Real Estate Brokerage

Here are some non-exhaustive examples of the differences between the professional practices of the two sectors. However, one similarity remains: brokers and agencies are subject to the same ethical obligations , regardless of their field of practice.

Mandatory and recommended forms of the OACIQ Unlike the residential sector, in the case of commercial or industrial buildings (as for buildings with five or more dwellings), brokers and agencies are free to use their own forms, although the OACIQ has created recommended forms, adapted to these different situations.

The use by the broker of the forms published by the OACIQ is not mandatory in commercial matters. However, the regulations provide for information that must appear in the brokerage contract or transaction proposal, such as the identification of the parties and the property, the broker's method of remuneration, and the price and conditions of sale.

Cancellation of the promise to purchase In residential real estate brokerage, there are mechanisms that allow the buyer, in certain cases, to cancel his promise to purchase. In commercial real estate brokerage, the buyer has greater power to cancel his promise to purchase, since there is a period called "due diligence" that follows the promise to purchase. During this period, the buyer reserves the right to carry out the necessary verifications, in particular the financial statement, the inventory, environmental inspections, zoning, obtaining permits, etc. Finally, he could terminate his promise if he is not entirely satisfied with his observations.

Visiting the building In residential real estate brokerage, it is normal for the buyer to visit the property before completing a promise to purchase, because the interior appearance is a determining factor in their decision. In the case of a rental property, it is rather the investment that usually interests the buyer. Visiting the premises is often conditional on the acceptance of a promise to purchase: we agree on the price and the conditions of the sale and then visit. This also avoids disturbing the tenants several times.

Information and duty of collaboration A broker has a duty to collaborate with another broker who requests it; they must therefore transmit the relevant information to each other without delay. However, in commercial matters, fearing that the financial data relating to his rental property or business may reach a competitor, the seller can make the disclosure of this information conditional on the conclusion of a confidentiality agreement. The signing of such a document by the potential buyer will reassure the seller as to the use of the information transmitted. The condition of signing such an agreement before any transmission of information therefore does not go against the ethical obligations of the broker.

Listing for sale1 The terms of listing differ since in residential matters, the broker generally proceeds by standard marketing (newspaper ads, signs, etc.) whereas in commercial matters, the broker generally proceeds by call for proposals. The same applies to the granting of the brokerage contract: the commercial sector favors calls for applications and sales pitches (commonly called " sales pitches ").

A transaction under the sign of protection

The real estate broker is mandated to look after your interests, whether he works in commercial or residential real estate brokerage. By using his services, you have access to the Info OACIQ information centre and can also use the Assistance Service to request assistance from the OACIQ if necessary.

The commercial real estate broker, like the residential real estate broker, is governed by the Real Estate Brokerage Act , the application of which is ensured by the OACIQ, contributes to the Real Estate Brokerage Compensation Fund (FICI) and takes out professional liability insurance ( FARCIQ ).

Furthermore, it should be noted that to constitute a brokerage transaction within the meaning of the Act, a transaction relating to the sale of a business must include the sale of one or more buildings, and these must constitute the principal asset, according to their market value, of the business. If these conditions are not met, the transaction is not covered by the FARCIQ.

For any additional information on this subject, we advise you to contact the Insurance Fund directly by telephone at 450 656-5959 or 1 866 956-5959, by fax at 450 656-5746 or by email at assurance@farciq.com .

SOURCE: https://www.oaciq.com/fr/pages/achat-vendre-ou-louer