Many of the big commercial real estate agencies now have tenant representation departments, but are they the best option if you need help with your office lease?
Commercial real estate agencies specialise in leasing, selling and managing property on behalf of landlords and property companies, as well as purchasing property for investment and leasing themselves.
A trend has emerged with some major global agencies in Australia – creating a department within the company and labelling it “tenant representation” or “tenant services”.
Playing both sides of the fence
While these “tenant representation” departments may portray themselves as independent tenant advocates, office tenants should carefully consider their independence.
Commercial real estate agencies make the vast majority of their revenue from landlords. So, the potential for their in-house tenant reps to have a conflict of interest is huge.
For example, what if the agent of your preferred office space is from the same agency as your tenant rep? The lower the rent the tenant rep negotiates for you, the less revenue their employer will make! So, whose side will they be on? Yours or their agency’s?
Or, your tenant rep puts forward a shortlist of properties for your consideration. But several of them are represented by their agency. How can you be sure the space is the best fit for your company and budget, and not just desperately in need of tenant?
Do you see the problem?
Independence = savings
The commercial real estate agencies often rely on their well-known brands to pull tenants in. But just because they’re large corporations doesn’t mean they can offer you greater savings. In fact, it is likely to be the opposite.
These agencies might not be able to offer office tenants the best deals as they may not search the market as thoroughly or negotiate as hard as truly independent tenant reps.
When you’re choosing a tenant rep, think about the impact independence could have on your savings.
Independence gives a tenant rep the power to explore the entire market, not just a select few properties. More options mean a higher likelihood of finding suitable office space at the lowest rent.
And you know those back-and-forth negotiations when you’re trying to score the best deal? Independent tenant representatives are your secret weapon. They’re committed to your success, which means they’ll negotiate with complete transparency. No hidden agendas or ulterior motives here!
TRS – independent always
Don’t let the big commercial real estate agencies hijack commercial tenant representation. To our way of thinking this service is for the tenant only, and TRS upholds this by never receiving money from landlords or agencies, and always putting the tenant first.
To find out more about TRS and how we can help you get the best deal on your next lease, please contact us.