Posted by ray@lcorn on June 01, 2006 at 14:24:59:
Whether you can truly shop the deal will depend on the market, local development patterns, zoning climate and a myriad of additional details.
Retail deals are very location sensitive, more so than any other property type. Generally a retail project needs to be on a main thoroughfare, highly visible and accessible, near other commercial development and close to residential development.
If you’re in a fast-growing area where zoning is tough, developable land is scarce, lots of growth, and this property is right in the middle of it all, then you’re in the driver’s seat and should shop the deal around.
On the other hand, if it’s a secondary or tertiary market, growth is spotty, lots of land available in the vicinity, zoning easy to get, then the developer may play other sites against you anyway. That’s what I meant by being able to “truly” shop the deal. Small markets are hard to develop, and there isn’t much room for error.
Chances are the developer has already checked out neighboring parcels and may have decided yours is his first pick, or not. He may have already talked with others and the price wasn’t to his liking.
Either way you can’t be hurt by talking to other developers. If this developer has a deal to develop a grocery store then he won’t stop just because there is someone else in the mix. It will likely make him try harder. And usually if a market area attracts one developer, there will be more coming. The rule of thumb in selling anything is to never take the first offer.