So basically you shake your head. It's just a dumb email, after all - right?
As a god forsaken commercial property solicitor, I am regularly sent details of off market properties which I then forward onto clients and contacts. These deals always promise huge finders fees and massive incentives. For example, last week I was sent information relating to a confidential £140 million development site in Central London promising a 2% finders fee (£2.8 million) if the deal could be successfully placed and completed. According to the details, it wasn't going to be too difficult as the developers were in administration and would take an enormous discount if necessary. The redevelopment value was estimated to be in excess of a billion pounds.
However, as I've found out, there are several problems with these deals and most of these problems reflect the current state of the economy.
1. The deal either doesn't exist or exists in a completely differently form to what is being touted. Frequently, this is because proprietors or their agents leak information into the public domain solely to ascertain what the true market value of their properties are. They usually have no intention of selling the properties and will always insist the properties were put on the market without their authority. However, the reality is quite different.
The best example of this is Northern Rock who at the end of last year knowingly released details of over 1,200 repossessed properties in order to obtain their current market price. The resulting scandal made the headlines of the Mail on Sunday and Northern Rock were extremely quick to maintain that the properties were not for sale and they had no idea the information had been released. The truth was by the time they issued their denial they had received all the information they required about the value and demand for their remortgage portfolio!
2. If the deal does exist, there will be a myriad of ignorant intermediaries and agents to overcome before you can actually get to the proprietor or the genuine controller of the deal. This is because the original information will have been been relayed to numerous agents and solicitors who will ultimately demand their finder's cut should the transaction ever complete. The process inevitably creates hideous chinese whispers so a £1m residential property development in Coventry may become a £12m commercial development in Central London by the time you receive it. If that isn't bad enough, the whole property market is currently swamped by paranoia, distrust, fear and greed. Unless you are dealing directly with original parties, the prevailing commercial atmosphere will drag you down. Supposedly off market and confidential properties have sometimes done the rounds for many months and will be flung around the market like a syphilitic whore.
3. If you can obtain an offer from an interested party, it will nearly always be rejected as being too low. Sellers are still woefully naive, or willfully ignorant, as to the current condition of the market which resembles a hedgehog that has been crushed by a line of several hundred tanks. In contrast, cash rich purchasers (there are no other types for the time being) are rare and highly valued. Unlike oppressed sellers, these purchasers are acutely aware of current market conditions and will have been wooed endlessly. When they make their precious cash offers, they will demand their pound of flesh and sellers will find their ruthless offers exceptionally difficult to stomach.
4. If, miraculously, a deal is agreed, it will inevitably collapse as sellers will become convinced that they have been cheated and purchasers will keep chipping the purchase price as the market continues to sink like a stone.
This is Brown's Britain in 2009 and it shows no signs of improving. It is just as well that our Prime Minister has only one functioning eye. With two eyes, he would behold the true state of the economy and the hideousness of his claim to have abolished boom and bust in 2007.