I'm a noob that needs help. how How much does it cost to sell a property? How do you estimate the final amount of profit?
Long story short, 5 years ago my mom died, my sister and I Inherited a commercial property, which was a surprise because my mom was broke, and my mom never really talked about the property. She was out of it her last year of life. The property was in pretty bad condition, and only 40% occupied, apparently my mom was on the brink of losing it.

We had to choose if we wanted to sell it, or keep it and work on it. We naively decided to keep it, and try to fix it up, and get it 100% occupied. After narrowly losing the property at one point, we finally got it 100% occupied and it's doing really well since a few months ago. The only reason we were able to fix it up and save the property is because 100% of the rental income has gone right back into the property for 5 years.

So at this point, we've been taking on a massive risk for years, that we don't benefit from. We realize how little we actually know, honestly I'm not sure how we've held through this whole time. For years we've dreamed about one day having passive income from the property, but now we feel like that may never happen. We don't have the balls to distribute any of the income to ourselves, you never know when something catostrophic will happen that costs dozens of thousands of dollars. 
At this point, it might be a better idea to make passive income investing in something else, using the money from selling the property. 

Almost two years ago we got the property appraised, it was estimated to be about 3.1 million dollars which surprised us. we still owe 1.2 million on the mortgage.  I don't want to give too much personal info, but we are located in Arizona in a really busy spot, the commercial property is occupied by all family businesses. So let's say we sold the property for 3,000,000, what are all the costs that go into selling it? How do I estimate the profit?

Also, any advice you have relevant to commercial realestate, please let me know. Thanks!
[{"id": "hlbyxa6", "text": "Typical sales costs are about 8%. The bulk of it is broker fees at 6%  then there are title and escrow fees. In this market in AZ and the investment opportunity it is worth paying brokers for the marketing side of it in order to bring as many buyers to the table as possible. The bottom line is you get what you pay for. \n\nSaw your other posts. You are thinking of a 1031 exchange. \n\nAZ CRE broker here. Happy to answer direct questions.", "replies": [{"id": "hlc5dn2", "text": "&gt;Saw your other posts. You are thinking of a 1031 exchange. \n\nHaha your intentive, thanks I appreciate it. \n\n&gt;Typical sales costs are about 8%. The bulk of it is broker fees at 6% then there are title and escrow fees. In this market in AZ and the investment opportunity it is worth paying brokers for the marketing side of it in order to bring as many buyers to the table as possible.\n\nOkay gotcha, yeah I for sure am going to use a broker, but first I need to read a book or two about commercial real estate buying/selling. You got a book/textbook you recommend? \n\n\n&gt;AZ CRE broker here. Happy to answer direct questions.\n\nAwesome Thanks! I will forsure probably be reaching back to you with more questions soon. I can also get Into a bit more detail through chat, I'm a very private person and created this throw away just for talking about commercial real estate. Not even my closest friends or family know about the property.", "replies": [{"id": "hlejglf", "text": "I do not know of any books or materials that would be on point. \n\nWhat specific questions do you have on selling, what is the asset (industrial, retail, office, etc), and what is the size of the property? These will all impact the sales process.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "hlcfow5", "text": "3+3 % commission is lower. 1% more for closing cost. So 210K off sale price at 3M. The listing agent if he can double end you should stipulate he get say 50% of buyer agent side so 4.5%.  Most residential realtors handle MF and their fees are slightly lower.  Some agents will take a fixed price. So you are still ahead.  I suspect AZ mf has gone up a lot since last appraisal.  In our area No CA coast it has jumped +30% during pandemic(again).  Most agents here will find a buyer in a few days.", "replies": [], "depth": 1}, {"id": "hlcr0av", "text": "If you shop around could probably find a broker who will do it for 4 or 5%.  I work for a bigger firm and we never pay more than 4% but without a possibility of repeat business you might have a tough time getting a broker to go below 5%. Then 0.5-1% in closing costs. Depends if your state has real estate transfer tax or not.", "replies": [], "depth": 1}, {"id": "hldkhj1", "text": "I'd find a way to keep it, you've done most of the heavy lifting.\n\nGo find yourself a mentor....the top 3 owners of like properties, you and Sis take these guys to lunch, bring copies of your leases for them to review, ask them for advice as well as the same question you asked here.\n\nI bet you'll have a vastly different opinion about keeping the place.", "replies": [{"id": "hlf4sw0", "text": "I appreciate the advice.\n\nYeah I feel like all the hardest and most stressful work is finally over with. For now. For the past five years there was always something drastic that needed to be done or fixed. I'd very often be on the phone with the management, the leasing agent, lawyers, contractors, etc. There was always something.\n\nBut recently, I suddenly realized \"wait a minute, for the past few months I've barely talked to management, and Im not at all up to date with any of the current issues\" so I anxiously called management for updates and was told \"there is no current or immediate issues everything Is going well\". It honestly sounded too good to be true, this is the first time I've heard that in five years. Every single time we finally had room to breath, some absolute bullshit would immediately happen, I've always assumed that's just the name of the game in commercial real estate.\n\nGetting a mentor is a really good idea, but I have no idea where to even begin to find one. I've really wanted an expert to look at all the leases, and finacial statements. I have no idea if the cash flow is even being properly utilized because I don't have any experience with other properties of management teams. Getting advice from an expert seems like something that I'd have to pay for, I know very successful CRE investors probably value their time, and unless they're doing business with me, I'm not sure they'd bother being a mentor to me.", "replies": [{"id": "hlf9tih", "text": "&gt;Getting a mentor is a really good idea, but I have no idea where to even begin to find one.\n\nSee my post above. It tells you exactly how to accomplish that goal.\n\nEvery CRE owner worth their salt will happily take an hour for someone who is sincere and truly desirous of knowledge.  Whether through paybacks for the times they got the ear of someone 40 years ago, or simple ego....trust me...you'll find someone who will be happy to advise. But you need someone local, from your area. Location matters.\n\nBut...don't seek out \"a broker\"....find an owner.  Someone (or several someone's) who got their hands dirty.\n\nAnd don't try to impress these folks...ain't nothing wrong with being green and dumb. Everyone starts out that way.\n\nYou have the asset stabilized, largely, now focus on getting incomes up...maybe that's repainting the parking lot to gain 12 parking stalls and...those lease out for $50.00 a month to people who don't have enough parking.\n\n$600.00 a month....$7,200.00 a year.  Not bad for a little paint.\n\nMaybe your building is situated on a hill better suited for cell signals than other buildings (or that you uniquely have power that those systems need that would cost more in another building).  Who is paying **you** for your roof today?  No one?  *Welllllllll*......that's a potential income source. There are firms that literally specialize in finding you roof top tenants.\n\nAre you on a super busy road?  Do you have enough room (and support....such as water and power) to build a tiny little drive thru coffee stand?\n\nI call these things \"leakage\".....money is leaking through holes that you haven't filled, and until you fill those holes...that money goes right through the property every day.  I'm sure people that went to college will have a much fancier name for it...but whatever you call it....it's cash that is driving past your parking lot every day...and it has ***your*** name on it.\n\nAnd, as each tenant leaves, that's a good thing...in fact, it's a *wonderful* thing.  When a tenant leaves, that's an opportunity for you to revamp your leases.  Do they have up to date rental increase verbiage and formulas?  If not....make that happen.  A small differential of just 2 or 3% annually over 5 years makes EVERY difference in your pocket. Is your base rent locked in for 5 years...or do you increase off of last years revised rent amount? Are you charging the tenants for all the services (taxes, utilities, etc.)?  You should.\n\nDo you have enough land to build an additional building on it?  Go find out what the county / city / municipal agency would allow and put up a sign or an advertisement on Craigslist or similar stating \"*will build to suit....xxx,0000 sf building*\".\n\nYou can figure out how to get the financing for it later.\n\nDon't have enough for a \"real\" commercial building?  Maybe you have enough to build some carport / garage type things?  Save up enough money to pour some 6 inch thick concrete pads and (check with your municipal agencies first) and get out there on weekends and start framing in some little garages yourself...maybe you have enough room to build something 200 feet long by 18 foot deep. Cost: If you do all the labor yourself...in wood....as low as 20 to as high as 40 bucks a sf (depending on where you live).  Think it'll look odd next to your existing building?\n\nDoes $60 - 90,000.00 of new annual income look odd to you?\n\nThink it's crazy that something you can build for 80 - 100 grand, will rent for 60 - 90 grand (annually)? I think so too but I can assure you...stranger things have happened in the real estate world. I'm confident there are CRE folks in here who can put those numbers to shame.\n\nPut a light bulb in each 18 x 20 foot space and rent those spaces out to a guy who has his plumbing business in his garage....I guarantee you....even if you live in the smallest town on the planet....some wife is currently yelling at her husband to *\"get that crap out of here...go rent a small mini storage somewhere.....I'm sick of having your crews use my bathrooms at all hours of the day and night.....\"*\n\nThere are only two things limiting you from doing any of the above:\n\n1. Desire.\n2. Effort.\n\n*(Everything else is already there for the taking).*\n\nEdited to add:  *\"Getting advice from an expert seems like something that I'd have to pay for\"*.  You've been paying the price for not having it for 5 years. You've stabilized the asset without their advice.  You did a great job.  Now go find out if you're smarter than you thought...or if you could benefit from someone's experience.\n\nChances are...*both* are true.", "replies": [{"id": "hlf9umz", "text": "200 feet is the the same distance as 88.35 replica Bilbo from The Lord of the Rings' Sting Swords.", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "hlds9ec", "text": "8-10% depending on legal and accounting as well. Things I\u2019m assuming you don\u2019t have but likely have to credit back are survey, plans, entity (?)\n\nWould ask a broker for a BOV, tell them you\u2019re not selling but want to pay them for it. Then you can decide again later. \n\nRegarding your exit, just have a plan for proceeds before you list. Are you looking for another property? DST fund? Don\u2019t want you trade one problem for another one.", "replies": [{"id": "hlegopb", "text": "Delaware Statutory Trusts, or DSTs, are an alternative for 1031 exchange investors seeking replacement properties. \n\nNot for me, but research it as an alternative to the 1031.", "replies": [], "depth": 2}], "depth": 1}, {"id": "hleg2jx", "text": "In my experience as a buyer and seller, I estimate all rolled up costs to be around 8% as a seller. The average time line is approximately 180-days from signing the listing papers to closing.", "replies": [], "depth": 1}]