Am I a principal or a broker?

I get this question a ton, usually from brokers who are interested in figuring out a way to take both sides of the commission (by representing both the buyer and the seller).

For the record, here’s my answer:

1. If you bring me a deal which is “off-market”, in the sense that it has not been widely marketed on the MLS, Loopnet, etc., then I will happily have you write for me. Nice work in bringing it to me: For a certain type of deal, I’m almost always the best buyer.

2. If you bring me some valuable piece of information regarding a deal which is on the market which causes me to view the deal differently, then I will happily have you write for me. Examples of information like this: The deal will actually be delivered vacant, the seller is willing to take dramatically less than asking, the property is actually non-rent control due to some obscure agreement with the city, etc.

3. If your deal has been widely marketed and I approach you, then I am almost certainly writing my own offer. The only exception would be in a scenario where the deal is ridiculously, blindingly, spectacularly good… and those deals tend to get bid up as soon as they are widely marketed.

The concept is pretty simple: I want to incentivize brokers to bring me good deals, disincentivize them from calling me about stuff I already see online, and allow myself to take the buy-side commissions when I’ve done the work of identifying the deal.