Q: What is the difference between a Commercial Tenant Rep Real Estate Specialist, and any other commercial real estate broker?

A: Commercial Tenant Rep Specialists only represent the needs and interests of businesses that occupy commercial real estate, either by lease or by purchase.  We do not take listings on property for lease or sale, since to do so would be representing the needs and interests of property owners.   Specifically, listing brokers have a duty of loyalty and care to get the highest price and best terms on behalf of the property owners they represent.  Whereas, Commercial Tenant Rep Specialists have a duty of care and loyalty to get the lowest price and best terms and conditions on behalf of the businesses they represent.

Listing brokers focus and specialize in specific property types, and specific markets.  However, a well qualified commercial Tenant Rep real estate specialist will have the requisite skill, training, and experience to represent a client in all types of commercial property, and in any market.  This means you will have a single point of contact for all types of commercial real estate property your business my require; local and nationwide coverage: industrial space, distribution space, office space, land, commercial or retail space, technical lab space, mission critical space, and flex space. 

Q: How is a Commercial Tenant Rep Real Estate Specialist paid?

A: Leasing. In today’s market ownership of commercial real estate has become a sophisticated endeavor.  It requires that budgets are well planned and funded.  Accordingly, commercial property owners have capital expenditure budgets, which are funded to pay commissions to brokers for new leases, both for new tenants and renewals of existing tenants.  Commercial Tenant Rep specialists are compensated by payments from owners when a lease is fully executed by tenant and landlord. 

Purchase. It is standard that a commission is funded to representative brokers upon closing and transfer of ownership, as a function of the purchase money paid to a seller.  This has not changed in hundreds of years.

Q: Does the Commercial Tenant Rep Real Estate Specialist have a conflict of interest if money to pay their fees comes from a seller, or owner?

A: Yes, the conflict is that a Tenant Rep Specialist may push or advise terms, which are disadvantageous to make the deal so they get paid.  That is why it is important to hire a Commercial Tenant Rep Specialist who is professionally trained regarding conflicts of interest.  That is, they must properly disclose all conflicts, advise assistance of legal counsel, and avoid all conflicts, which will materially interfere with proper representation of their clients.

Though the conflict exists, it is further buffered by market conditions, which will protect the client.  There is a saying, when your research becomes circular you have done enough, meaning you come to the same answer after repeated inquiry.  A Commercial Tenant Rep Specialist who has done his job properly will have worked with his client sufficiently that market rent, concessions (free rent, tenant improvements, sign rights . . .) and other terms and conditions will be so well established, the client will know they are not being force fed a bad deal.  In fact, it will be clear in their mind to what extent they are being aggressive in their negotiations.

It is also important to know that the concept of payment from third parties is common place in today’s business world.  For example, insurance defense attorneys are paid by insurance companies, but represent the insured parties in their legal actions.  

Q: What if I merely want to renew my lease for my current lease space, do I need a Commercial Tenant Rep Real Estate Specialist?

A: Your landlord is in the business of leasing commercial real estate.  The primary business requires they implicitly know the market to include competition, rents, and other data surrounding the property.  Likely, your landlord has an ongoing legal obligation to report to investors and lenders regarding facts and data regarding the property and surrounding market.  Trust they know where they stand in the market before you start talking. In this vein, your landlord undoubtedly has a listing broker and dozens of relationships with brokers, property managers, and appraisers to keep abreast of the market.

So, the question is really best answered with a question.  Wouldn’t you want similar data and information, and more importantly knowledge of your actual, meaningful options before you engage in negotiations?  Since it is in your landlord’s capital expense budget to pay your Commercial Tenant Rep Real Estate Specialist, and since the market will dictate terms and conditions for your transaction, you have nothing to loose and everything to gain.

Q: When should I start working on looking for a Commercial Tenant Rep Real Estate specialist?

A: All things equal, you should pick a broker 18 to 12 months prior to the expiration of your lease, but it is never too late.  It is not unusual for us to be retained, when clients feel they are not getting proper representation.  It is also not uncommon for businesses to get to the “last minute” before they focus on their facilities.  Do you remember what cabinet has the lease buried in it? Perhaps the landlord just called reminding you there are only a few months left on your lease and now wants to know what you are going to do.

Landlords know they have a lot to loose once you vacate the premises.  Too often clients feel they have a gun to their head and that they have to wrap up a new lease or location, on or before their lease expiration date.  In reality, a good Commercial Tenant Rep Real Estate Specialist can easily negotiate with a landlord to agree with a month-to-month commitment, or other short term obligation prior to termination of your current lease.

Q: What is the advantage to hiring a Commercial Tenant Rep Real Estate Specialist with an exclusive agreement?

When you grant an exclusive agreement, you are making a commitment to a Commercial Tenant Rep Real Estate Specialist that they will be treated no differently than had you hired that person to be on your payroll, and sit down the hall in your office.  They are a one stop, outsource delegated with the responsibility to manage your facility requirements.  If used properly, the delegation frees you up to stay focused on your primary business and trust that information will be presented so that you are not bogged with wasteful detail, yet presented with meaningful information to make informed decisions.  Since an exclusive guarantees your agent will earn a fee regardless if you lease or purchase a new facility, or renew your current lease, it is your way of avoiding situations, which could create further conflicts of interest.  In return, you get a relaxed, hard working, motivated professional willing to put all the time, energy and cost necessary to take care of your needs.