Tenant Representation:
A Valuable Service At No Cost To You
A Valuable Service At No Cost To You
It's time to renew your lease and you just sign the papers. Why not? After all, you've been at the same location for several years and you've always just signed the new lease.
By doing this you may be missing out on more favorable terms and conditions. Think about it this way—what if you were not just re-signing your existing lease; what if you were signing a new lease at a new space with a new landlord? Would they be offering you the same deal? Often the answer is no.
The renewal process is your opportunity to reassess your real estate situation, look closely at the commercial real estate market in your area and to rethink your relationship with your landlord.
The good news is you don't have to go it alone. The increasing role of tenant representation has given tenants the ability to have a real estate professional work on their behalf.
Whether renewing your current lease or entering a new lease, here are some things to consider:
By doing this you may be missing out on more favorable terms and conditions. Think about it this way—what if you were not just re-signing your existing lease; what if you were signing a new lease at a new space with a new landlord? Would they be offering you the same deal? Often the answer is no.
The renewal process is your opportunity to reassess your real estate situation, look closely at the commercial real estate market in your area and to rethink your relationship with your landlord.
The good news is you don't have to go it alone. The increasing role of tenant representation has given tenants the ability to have a real estate professional work on their behalf.
Whether renewing your current lease or entering a new lease, here are some things to consider:
- Time frame. Do not wait until the month your lease is up to start negotiating or obtaining the needed information. You simply won't have enough time to do it correctly and your landlord will realize this, thus you will have lessened your advantage.
- What is the current market like? Has it softened since you first signed your lease? Are any large companies moving into or out of the area that may affect the real estate prices in your area?
- Compare individual properties in your area to gain insight as to what options you have available. Be aware that the terminology used between landlords may be different. Here are some areas that can cause confusion and hinder your goal to make a fair and informed comparison:
- Tenant Improvements—It is very important to clearly define who is paying for what.
- Measurement of Space—Be certain you understand the difference between usable (the actual space you will be using) square feet and rentable (your space plus a percentage of the common areas such as bathrooms, hallways, etc.) square feet so you can make an accurate comparison.
- Rent Per Square Foot—Rent structures can vary dramatically ranging from gross leases to triple-net leases. Understand what is being included in your structure: taxes, utilities, operating expenses, maintenance charges, common area charges, etc.
Deal with an expert. By ethics and law, real estate brokers are obligated to be fair to all parties involved in a real estate transaction. However, unless the broker is your representative, the broker cannot offer opinions on properties, give advice about your transaction, or even make specific
recommendations. Hired by you as a tenant representative, this allows the broker to present the facts, make specific recommendations and give advice. A partnership with a qualified broker to act as your representative allows you to take advantage of their experience, expertise and market insight.
What type of expertise to look for? When selecting a tenant representative look for a company that has expertise in all areas of real estate—from ownership to management to development to sales. It makes a lot of sense to have all these areas represented because companies with this type of broad and extended experience can off you the largest support.
What does it cost? In most situations the landlord pays all tenant representation fees. This means that all these benefits are available to you without direct, out-of-pocket expense.
More Information? If you would like more information on this important topic, please fax a note on your letterhead to 713-977-7288 or zip us an E-mail to elberger@concorderealty.com.
Author's Note: Bob Elberger is the co-founder of Concorde Realty Development and a leader in the Greater Houston business community for more than 15 years. Founded on Bob's focus on value and creative problem-solving, Concorde Realty Development has a unique ability to recognize hidden opportunities in the real estate industry. Concorde Realty Development is based in Houston, Texas and can be reached by phone at 713-789-3600 or at www.concorderealty.com.
What type of expertise to look for? When selecting a tenant representative look for a company that has expertise in all areas of real estate—from ownership to management to development to sales. It makes a lot of sense to have all these areas represented because companies with this type of broad and extended experience can off you the largest support.
What does it cost? In most situations the landlord pays all tenant representation fees. This means that all these benefits are available to you without direct, out-of-pocket expense.
More Information? If you would like more information on this important topic, please fax a note on your letterhead to 713-977-7288 or zip us an E-mail to elberger@concorderealty.com.
Author's Note: Bob Elberger is the co-founder of Concorde Realty Development and a leader in the Greater Houston business community for more than 15 years. Founded on Bob's focus on value and creative problem-solving, Concorde Realty Development has a unique ability to recognize hidden opportunities in the real estate industry. Concorde Realty Development is based in Houston, Texas and can be reached by phone at 713-789-3600 or at www.concorderealty.com.
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