A commercial broker helps clients acquire properties. This is a booming industry with plenty of parties at play, and the government doesn’t take it lightly. The work of property management is greatly regulated.
However, a commercial real estate broker’s regulations will vary depending on where you live. In some cases, the government may have specific regulations in place for commercial brokers and property managers.
In other cases, the industry itself may have its own set of guidelines that professionals must follow.
Here are some of the regulatory bodies that are tasked to ensure that a commercial real estate broker or an industrial real estate broker is licensed and property managers meet the set standards while conducting business.
The Licensing Boards for Residential and Commercial Real Estate Brokers
The Licensing Board for Residential and Commercial Property Managers is a board that was created by the state of Maryland in 2006. This board is responsible for licensing commercial brokers and regulating property managers in the state of Maryland.
If a cheap commercial property for sale doesn’t meet set quality, you can contact the board to file a complaint.
The Department of Commerce
In every state, the Department of Commerce is responsible for regulating property managers. This department ensures that property managers are complying with the law and are providing good service to property owners.
They also work in conjunction with commercial brokers to protect the interests of property owners.
The Department of Insurance
The Department of Insurance is responsible for regulating commercial real estate brokers in most states. This department ensures that property managers are adhering to the insurance requirements for property management businesses.
The department hence cannot insure a cheap commercial property for sale with no resale value
The Federal Trade Commission
The Federal Trade Commission (FTC) is a federal agency that regulates the advertising and marketing practices of businesses. The FTC has an enforcement branch, which is known as the Bureau of Consumer Protection (BCP).
The BCP is responsible for investigating complaints against any commercial real estate broker or industrial real estate broker and taking disciplinary action against those who have violated the law.
Department of Business Oversight
The Department of Business Oversight (DBO) is the regulatory agency for the financial services industry in California.
The DBO has an enforcement branch, which is known as the Division of Financial Institutions (DFI). The DFI is responsible for investigating complaints against a specific commercial real estate broker and taking disciplinary action against those who have violated the law.
Here’s What A Commercial Real Estate Broker, Should Watch Out For
- Making false or misleading statements about a property
- Charging excessive fees
- Taking kickbacks or bribes
- Failing to disclose important information about a property
Consequences Of Not Being A Regulated Industrial Or Commercial Real Estate Broker
If you’re a commercial real estate broker, then it’s important to ensure that you’re working with a regulated property manager. Otherwise, you could face some serious consequences.
First oft; if you’re not a regulated industrial real estate broker, then you’re not going to be covered by any insurance policies. This means that if something goes wrong, you could be on the hook for a lot of money.
Second: not being a regulated commercial real estate broker could seriously damage your reputation. If something goes wrong while you’re working with an unlicensed property manager, then people are going to blame you.
For more information on the regulations imposed on a commercial broker, please check out Treevita, a regulated property manager.