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As brokers, our pledge to our clients is “to secure the highest price and best terms from the largest pool of qualified buyers at any given point in time.” Techniques we typically engage to accomplish this include public auctions, sealed bids, and extensive advertising by which we hope to create a competitive environment that will enable us to drive up the price. This is usually achieved through the use of signs, advertising, direct marketing, etc. Any attention-getting methods should be used to get the word out that this asset is for sale. Aptly described as “on-market” selling, this is also sometimes referred to as “push marketing” referring to the broad dispersal of information to the market.
And, in a “sellers’ market” with an abundance of ready, willing and qualified buyers, this is a suitable choice as we have seen in recent history. However, there are many purchasers who refuse to participate in auctions or anything that looks remotely like one that narrows the pool of potential bidders. With a limited number of buyers, it is questionable if you are getting adequate exposure to the "right" buyers. Today, with many ‘acquisition funds’ being formed to take advantage of historically low pricing and potential windfall opportunities to acquire distressed properties and loans, more and more “off-market” transactions are being recorded.
Exactly what is an “off-market transaction?”