The Evolution Of Tenant Representation
Author : Caroline J. Smith Law | Published On : 28 Sep 2021
Have you heard about the dirty little secret of the commercial real estate industry known as conflict of the industry? If your response is negative, understand it so that when you look for a new building, things get musky, conflicts are obvious. You need to consider the commercial real estate tenant representation.
Fact about tenant representation!
What is tenant representation?
A tenant representative is a professional commercial real estate broker who exclusively works for the tenant or never the building owners. These people are now universally embraced because they are helping the world to maximize their profit and ride on a positive road while dealing.
How has tenant representation changed the industry?
Previously, landlords and brokers used to hold all the cards and tenets with very few chances of winning the end. Since the tenant representatives have started showing reality to the market, tenants have started holding a card. After all, they pay the rent of the building.
What kind of savings can CEOs expect by using a tenant representative?
It is a known fact that for most companies, real estate is the largest expense after payroll; that is why real estate tenant representation is significant because it saves the hard dollar and mitigates the risk. Every landlord on this entire planet searches for the highest paying tenants, and typically, tents look for the cheapest properties; a representative helps you with that.
Is there any resistance to tenant representation from the old guard?
Yes, there is. If we look from the landlord's perspective, we are the ones who are helping their customers and educating them to use their leverage, which is causing them lower rent. The lesser money but greater lease flexibility and more tenant-oriented protections do not let them sleep in the night. A landlord will definitely try to keep a representative out of the game.