Don’t trip up over this. Just fill it out, sign it and forget it. It means nothing, except the managing broker wants one just in the case you are given a pocket listing and then search out the owner and make a side deal that cuts out the brokerage. In that case, if he (broker) can figure out what you’ve done, he’ll try to make your life a living hell, if you haven’t closed yet, and the deal was large enough.
Meantime, you’re probably not planning or intending to do that, so it won’t be a problem. If however, you actually do that… the community of commercial brokers in your area, is likely very tiny, and you’ll get a nice big, bad rap among these people and then you’ll be worse than “toast.”
Make friends with these folks, and if they know you’ll perform (and can) they’ll be very good to you. Like all things, it’s relationships that guide this industry as much as anything.
Just as an aside, larger deals attract more help and cooperation, because everyone involved stands to make more money if the deal closes. I found this out when I bought my second apartment building. Positive resources, advice and help came out of nowhere. Just saying.
My second deal was 18 units in KCMO, and it wasn’t anything near $5M, no.
However, 5 million, where I’m today, will buy me a bread and butter complex that’s about 40 years old…
I don’t know how to answer your question regarding the size of the deal. Theoretically the larger the deal the more likely the agent will take action to protect his interest.
That all said, the C.A. is still fiction. Theoretically, anyone can pass the lead on to a 3rd party, and 3rd party buyer(s) could strike a deal with a seller, without the agent’s further involvement and despite the “leaker” signing a confidentiality agreement.
However, this is likely going to be a one-off transgression, because word will spread like gossip about a pregnant nun.
Treat the brokers well. Make friends with them. Let them make their money as agreed. If they make money and you represent repeat business, not only will you make the returns you want, but you’ll enjoy an army of agents offering you first right of refusal on their pocket listings.
Whoops, I misinterpreted your question in my previous post. You werent’ asking about the risk of getting attention about going around the agent… You were asking about the attention you would get buying at a higher price point. My bad.
You’ll get plenty of attention at the $5M price point! I would say anything over $3M and the momentum is easier to maintain and generate. It’s interesting to me also, that the feedback you get from the professionals is of higher quality and sophistication as you go up the food chain.
As an aside, you should retain the most aggressive and effective real estate contract litigator you can afford. He could make, or save, you more money than he costs if things go south. BTW, it doesn’t hurt to let people know who represents you legally, when it serves your purposes.
My brother was glad he retained the best RE contract litigators in the county when he had to sue the state for damages on a real estate project gone south. He won a huge settlement mostly as a result of his choice of legal representation.