On Your Side: Benefits of Tenant-Only Representation
Finding a commercial office space that meets your company needs and budgetary restrictions is often a long and grueling process. In the face of seemingly endless deliberations and ever-increasing options, it can be tempting to sign on with the first commercial real estate representative a potential landlord suggests – and at first thought, the connection makes sense. Theoretically, a shared representative would have a full understanding of both parties’ needs and be in a position to hammer out a reasonable compromise. Given the bias a landlord’s representative naturally has for their employer’s interests, however, this rarely works out well in practice. CRE tenants need to safeguard their own interests by looking beyond the immediate options and finding a broker who specializes in tenant representation. Here, I outline just a few of the benefits of bringing a tenant representative onto a commercial real estate case.
The best real estate brokers are phenomenal communicators. They listen as you outline your company’s needs and finances, and are forthright in assessing the problems inherent in a space. However, even trustworthy brokers can steer you wrong if their first loyalties lie with the landlord. Think of it this way: while the representative may want to give your case a fair shot, their paycheck ultimately comes from the landlord’s wallet – therefore, they need to maneuver showings, negotiations, and closings to fall in their employer’s favor, even if such a deal is less opportune for you. A dedicated tenant representative, however, is ethically bound to look out for your interests. They won’t be obligated to push you towards a specific property, or encourage you to take terms that put the lesser’s interests above yours. A tenant rep focuses solely on meeting your needs and interests, and is thus better able to get you the deal you want at the negotiating table.
Tenant representatives know the landscape. As market experts, they will be able and willing to tell you how much a property in the area should cost and whether a any given quote is reasonable given the market. But a tenant rep’s value doesn’t simply lie in knowing the market – part of their skill set lies in understanding their clients, as well. An office is more than four walls and a line of desks; it is a physical home for the company’s mission and values; a place to foster the business’s culture. A good tenant rep can think beyond simple budget and area requests and find a space that suits the spirit of the company in addition to its logistical needs.
A good tenant representative’s job doesn’t stop when closing papers are signed. Once a company leases a company space, it needs to design and outfit their office to suit their needs. This process is a complex one, requiring the aid of a number of outside contractors and consultants. A tenant rep can take point on managing the project or simply connect their client with trusted architects, contractors, IT vendors, and other needed third-party businesses.
In the end, a tenant representative is always valuable: they help guide their clients through a plethora of options, fight for their interests at the negotiating table, and close out the process by aiding in the office’s final design and launch. The success of a company branch starts with finding an ideal commercial space – so why not give your business its best shot by enlisting the aid of a tenant representative?
*Originally posted on ErichSollman.net