Download Transaction Narrative Guide.

ALC Application - Transaction Narrative Guide
Transaction Narratives are utilized by the ALC Designation Committee in order to understand the
transaction and the role of the candidate.
Narratives should:
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Include:
o Candidate’s role
o Buyer/Seller’s objectives
o Transaction activities, challenges, solutions, and outcomes
o ALC skills and tools applied to complete transaction
Be no less than 300 words.
Be written in a professional voice.
Have correct grammar and spelling.
Below are examples of great narratives from previous applications.
Further tips are highlighted in red.
Transaction Narrative Example #1
The following narrative fulfills all of the above points and incorporates how the LANDU courses would
have been helpful had the candidate taken the courses prior to the transaction.
This transaction was one of my first large-scale sales. It was challenging at times but ultimately
prepared me for sales down the road and led to what has become my most beneficial professional
relationship.
My role was that of the buyer’s agent, and I have ended up helping this party purchase three
class A farms and currently have another pending. The seller had listed this farm with another
REALTOR® in our firm who has since left the industry. The seller had owned this parcel for a short time
purchasing it when river bottom land was selling at a discount. His goal was to reap the benefits and use
the proceeds for a 1031 like-kind exchange. The buyer’s goal was to enter into a new venture with a
parcel large enough to make the commute economically and logically feasible.
The initial connection with the buyer was made through advertising in a farmer publication.
After some initial data gathering, buyer interest “gained steam” and negotiations got underway. The
immediate challenge came from the seller. He had the reputation of being a very tough negotiator. He
had always had a way of piling on additional requests that would muddy the waters. When a deal
appeared imminent, he would request a closing extension or suggest a complex closing date trigger
clause in case he found a 1031 opportunity.
Another issue involved a natural gas pipeline that had just gone through the property. The farm
was in the middle of a multi-year damages payout plan through the Express Pipeline Company. This
added additional dollars and payments to an already complex situation.
Transaction Narrative Example #2
The below narrative is an effective example of how challenges were overcome, lessons were learned,
and knowledge was used from the LANDU Education Program.
This transaction was unique in several ways. I secured this listing as an auction working for the
seller as a seller’s agent. The seller’s objective was to make a large profit on this farm. His family
purchased this farm in 2007 before land prices sky rocketed. The current market place gave the seller an
opportunity to “cash in”. The seller was also moving his/her family across the United States which was a
motivating factor.
My actions as the land professional took all aspects into consideration. An auction greatly
intensifies the need for concise and efficient marketing plan. The marketing was to stay within a $5,000
budget. Flyers, posters, newspaper ads, and site specific signage were included in this budget figure.
Securing a strategic and feasible auction site was also a priority. We, the firm, refrain from onsite
auctions because too much is at stake to rely on “Mother Nature”.
Another challenge was the location of the farm. It was a little further south than the area to
which we usually marketed. Our network was not as deep, and so more investigative work and
networking needed to be done. Finding addresses and establishing meaningful contacts was time
consuming. We also took on the challenge of separating this tract into two separate parcels. We did this
because our fear was that such a large piece of land would limit the numbers of bidders. Not many
parties have the economic means to purchase 270 +/- at a strong price. Organizing and obtaining the
survey in a timely fashion added to the responsibilities I had to oversee. In the end, the same party
purchased both tracts, but we opened up options which brought interest and potential new clients.
The outcome was that tracts one and two sold for a very strong price. Tract three did not meet
the bidder’s reserve price.
This was a huge learning experience for me. I realized that doing business in an unfamiliar
geographic area is challenging and takes time and a more strategic approach. We, as a firm, also
learned how to better handle situations where one tract does not quite live up to expectations.
Transaction Example #3
This narrative includes all of the requested points and presents the transaction in a well-written and
well-organized narrative format. Many transactions have stories behind them adding to the learning
experience.
Going with Your Gut – Marketing unique real estate has a way of allowing land professionals to
cross paths with interesting people creating business opportunities. Although I ended up representing the
buyers for this transaction, I originally met them while representing a seller on another listing.
A lady, Jane, called me stating she, her mom, and sister would like to view a specific property I
had listed in Iowa. She mentioned how she and her husband were originally from Iowa, and they wanted
to move back to Iowa from Ohio.
I arranged the showing and met Jane and her family at the property for a tour. Jane’s husband
was unable to join us for the showing. When I asked Jane a few personal questions about her husband,
she did not offer much information. When I asked her what her husband did for a living, she replied, “not
much anymore.” Since I did not receive clear answers about who they were and what they did, I started
to think that I had done a poor job of qualifying them as legitimate buyers for the property. However, I
had a gut feeling from our initial conversations that she and her husband could afford a place such as the
one I was showing her. I had learned from previous experience, especially when selling $1M+ real estate
to unrepresented buyers, qualifying them from the beginning is an absolute must, but can be much
harder to do than qualifying buyers on properties of lesser value.
After viewing the property, Jane informed me that she did not believe the house was large
enough to accommodate her husband and three young children. She told me that she would be
interested in other properties in Iowa with 80+ acres including some sort of outbuilding and a home of no
less than 5,000+ finished square feet—a criterion that does not often come up in our state. After doing
some searching, I was able to locate a property for sale that seemed perfect for Jane and her family.
Note: All of the contract negotiations took place while I was at 2011 LANDU Education Week in Chicago.