Thursday, March 1, 2012

For Tenants Only – Benefits of Exclusive Representation

Tenants undertaking a commercial premises search should insist on Exclusive Representation in working through a Broker on their requirements. As the old adage goes – DON’T GO IT ALONE - and there are a host of benefits which should be gained by working with a broker on an Exclusive Representation (ER) basis.

Here are some key areas to focus on as you interview candidates for your assignment:

i) Market Knowledge/Competence - the agent(s) should be able to be able to provide good advice concerning market availability, locational/market trends, building options, base rate/operating cost analysis, and landlord background, as a most basic initial starting point. References and resumes most often speak for themselves and should be requested to confirm the qualifications advertised.

ii) Representation – major landlords/developers often have their own exclusive leasing staff representing their interests. Tenants need similar representation.

iii) Savings – Tenant saves time and money, as the Agent develops the list of building/locational options, arranges the property tours, solicits landlord proposals, assists in space planning, and coordinates detailed negotiations on the selected property. These are the key elements needed in any successful ER.

iv) Brokerage Fees – depending on the jurisdication and the market, most often the Landlord will agree to pay the fees due to a Tenant Representative, and will build it into the lease transaction itself. Insist that the Agent’s fudiciary responsibility remains to you (the Tenant) in any ER Agreement which is entered into.

v) Privacy - ER can protect your privacy and confidentiality as you move through the market process, engage landlords/other brokers, and eliminate any adverse publicity on an impending move.

vi) Timing on ER Agreement – can vary depending on the specific needs of the Tenant and the realities of the marketplace. Both parties must agree on a realistic time period - but more importantly, have a clear understanding of expectations relating to the services being provided, regular communication & reporting, and feedback mechanisms.

Although not necessarily a complete list of requirements, the above gives you a sound basis to interview candidates for an ER Mandate. At the end of the day, a Tenant must be confident in the ability of the Agent to ‘GET THE JOB DONE’.

As always, seek out experienced commercial realtors with successful leasing backgrounds, to provide you with Exclusive Representation on your next move. To learn more about our Tenant Representation services, click here.

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