With all the information on line, many tenants are searching for office space without a broker. Can you imagine? I Can.
I get calls from tenants that are frustrated. The office market data is often out of date and many leasing options are not visible without a subscription. Beyond the lack of good data, tenants complain about the amount of time required to sort through all the information. Once I talk with a tenant about the benefits of working with a knowledgeable broker, the tenant breathes a sigh of relief; particularly when they realize that they don’t have to pay the broker to assist with office needs.
Nothing is free, but hiring a broker is as close as it comes. A tenant representative gets paid by the landlord only when a deal is done, similar to how a residential agent gets paid when representing a buyer.
Another reason you hire a broker is because finding new space and negotiating a new lease or a renewal is complicated. Finding space is just the tip of the iceberg, and a when you work with an agent you save time because the agent knows what is actually available, and the agent knows which landlords are “reasonable” and those who are not.
Many office users (occupiers, tenants, owner users,) whether they lease or own, need guidance even when they don’t need to move. Over 50% of the clients I represent need to deal with their office needs years before the lease expires. Occupiers outgrow their space, so they need to sublease and move, or they need to expand and extend their lease. Some tenants need to consolidate. What happens when business slows down, and you need to cut your real estate costs? What is the best way to go? Well, a good commercial agent will help you evaluate all the options. Once you have weighed the options you can move forward – with a clear objective in mind. We are just finishing up a lease where the Tenant has nearly 5 years left on their existing- they anticipated that they would need about 50% more space a year from now, so we negotiated an extension and expansion that included a significant tenant improvement allowance. Had the tenant waited, they would have been reacting and they would have had much less leverage in negotiations.
Business leaders, Executive Directors, Partners, all the C level execs, are smart – and they have not gotten to where they are by accident. Success is a deliberate process; so is dealing with commercial real estate. It is no accident that most these smart business leaders hire a commercial agent. It just makes sense.
Tom Bacon, CCIM, has been assisting commercial real estate clients in Sacramento since 1991, with an emphasis in office properties and Occupier representation. Click on the link to subscribe and download the free Commercial Real Estate Leasing Guide.
