Leases dominated our roster of closed transactions for May with our office signing or renewing leases equating to more than 205,000 square feet.
With such a significant amount of leasing activity, we thought we’d take a deep dive into the benefits and misconceptions regarding tenant representation and share with you our top five reasons why hiring a tenant representative is beneficial!
Signing a lease for a commercial property is a big commitment, and finding that perfect space is often a time-consuming and sometimes, daunting task. The good news is – you don’t have to do it alone! Hiring a tenant representative can save you time and money, and provide you with many other benefits you may have not even considered!
Are You Tired of Unreturned Calls?
Believe it or not, a lack of representation can affect landlord and broker responsiveness. As brokers and landlords sift through dozens of calls per day, they naturally consider inquiries by other brokers to have more legitimacy. Additionally, they have established relationships with other brokers and landlords, as they have probably worked with them in the past, which also carries weight. And at the end of the day, their goal is to lease their available space, so the effort is placed on returning calls that have the most promising return on investment.
By hiring a tenant representative, response times increase and your interest is taken seriously.
Find the Space You REALLY Need
As the saying goes, we don’t know what we don’t know. You may set out with a list of “must-haves” that in reality, either isn’t attainable or are possibly not really what you need. Hiring an experienced representative can help you ascertain what you really need from your space, as well as future considerations. Also, a good broker is also well-versed in all the latest trends and can share with you what other tenants are doing, which may provide a new perspective when looking at a space.
Furthermore, brokers have networks and market knowledge that they leverage to present you with properties that aren’t listed or aren’t currently on the market, giving you an advantage! And also saves you precious time!
Read In Between the Lines
There is a lot of gray area in those black and white contracts. Knowing what terms can be negotiated in a commercial lease boils down to experience. There are dozens of terms that can be negotiated and a broker knows what standards are acceptable and what aren’t. They also understand how those factors contribute to the total cost of occupancy – another somewhat gray area to the untrained eye.
Additionally, they know which landlords are deal makers – another time saver. Beyond that, every negotiation is based on give and take, and a good broker is skilled at understanding what economics are important to both parties which can make for a harmonious lease.
Hiring a Tenant Representative Doesn’t Cost You Anything
That’s right. Landlords have a listing agreement with their agent that states that their agent must split their fee with the tenant’s broker. It is a misconceived notion that landlords are more amenable to negotiations without tenant representation. Regardless of your decision to have representation, the fee to the landlord is usually the same.
Real Estate is About Relationships
But isn’t a broker’s commission determined by the value of the lease? Yes, it is. But – a good broker would rather establish a long-term relationship with you and earn your referral business. There is far more value in preserving their reputation than earning a few extra dollars on a single commission.