Tenant representatives are commercial real estate brokers who specialize in assisting commercial tenants seeking office, medical office and industrial space for lease. Although commercial real estate tenant representatives act on behalf of tenants, their fee is paid by the landlord.
There are times the landlord’s agent represents both the landlord and the tenant. This is called dual agency. Although the agent already has sworn his or her loyalty in writing to represent the landlord as his principal with a fiduciary responsibility to act in the best interests of the landlord, the dual agent then pledges to represent the tenant prospect as agent. When the landlord’s agent acts as a dual agent, there is always a potential conflict of interest. It is never beneficial to a tenant when an agent represents both sides of the transaction.
A commercial real estate tenant is better served by hiring a tenant representative to represent the tenant exclusively. The exclusive tenant representative will perform a site search of all available properties, filter those buildings meeting the tenant requirements, arrange tours of properties the tenant would like to visit, and negotiate letters of intent to lease space on behalf of the tenant. Finally, the tenant representative assists the tenant in negotiating business points for the lease agreement. As exclusive agent for the tenant, tenant reps provide objective, conflict-free advice.
Although landlord agents work to get the best deal they can for the landlord, tenant reps owe their loyalty and fiduciary responsibility to the tenant. The tenant gets a much better chance of a fair deal when the tenant rep is working on his or her behalf.
In the past landlords had an overwhelming advantage in terms of commercial real estate market information, but with the advent of tenant reps, tenants now have a mechanism to fill the knowledge gap. Tenant reps provide a source of current market data to help level the playing field for the tenant.
Rental rates are currently rising as the economy improves and vacancies decrease. We expect that rates will continue to increase over the next several years as the economy continues to improve. There are still opportunities to be had and we are encouraging our clients to review their leases now in order to determine if it makes sense to extend the term of their lease in order to lock in a rate moving forward. Please feel free to contact us at any time for a free lease analysis. Retrieved from “http://www.articlesbase.com/real-estate-articles/no-cost-for-tenant-rep-2263659.html“