In the world of commercial real estate, a tenant representation broker is the professional whose sole clients are office tenants in need of finding, re-locating or re-negotiating their office lease. This is the guy (or gal), who decision makers often times question the value that this professional could potentially provide to their business. First of all, what is a tenant rep broker? Why do I need a tenant rep if I can have my assistant search online for my new space by simply googling “office space” or by driving by and calling the “for lease” signs on the side of a building? Why should I use a tenant rep to negotiate my lease if my landlord, their broker and I have already discussed renewing my current lease? All these seem like pretty reasonable questions and what needs to be done sounds pretty simple, right?
Finding and leasing commercial office space and securing a dream office is much easier said than done and savvy and experienced tenants generally tend to agree, especially if their first go-around was without a tenant rep. There is a lot of money involved when signing a long-term lease and a whole lot more risk if you don’t know what you’re doing. The office leasing process is much more complex and much less straight forward than you’d think especially when the transactions are long term decisions. Below is a list, to name a few, of the things you’ll need to consider if you want to go it alone:
– Locating spaces in the right market that meet your requirement within your budget
– Market rates and asking rates
– Term length and pros/cons to signing a long-term lease
– Rentable vs. usable square footage & how much space you really need
– Rental abatement
– Parking costs & availability
– Early termination
– Load factor
– Base year
– Renewal option
– Right of first refusal
– Build to suit
– Triple Nets (NNN) and CAM charges
– Tenant improvement allowances
– Moving allowance
– Security deposits
Feeling overwhelmed yet? Wait until you see a fifty page lease! Not only does learning and understanding what all these terms mean and how they may affect your business take a substantial amount of time and energy but one small phrase or word over looked could cost you big time in the long run. If you think you’re saving money by not engaging a broker to be your advocate, think again. Your landlord has a representative, shouldn’t you? Many tenants also don’t know that the landlord pays the tenant representative’s broker fee which means our services are free to you.
Don’t let your office leasing experience turn into a nightmare for you and your business. If you feeling confused, overwhelmed and feel like you’re struggling to make a decision regarding your current or future office space lease, reach out to any one of our tenant reps at TTG for a free consultation and some sound advice!