The fourth quarter is upon us, the most competitive time to secure lease terms.
With the end of the year looming, landlords and their brokers are working hard to sign leases and increase building occupancy.
It’s a good time for a business owner to have a tenant representative take a look at the best opportunities for securing new or renewed lease contracts.
A tenant representative is a licensed real estate professional who represents only tenants and corporate users of commercial real estate. The basis for this representation is that the client company can be certain that its commercial real estate agent has no conflicts of interest such as building listings and landlord contracts.
A tenant representative is, in essence, a partner devoted to an unbiased real estate process. A tenant rep represents only your interests.
Tenant reps work with other real estate companies and property owners on a daily basis to satisfy the needs of clients.
They cover the entire process of site selection for your business. Even if you’re not ready for a fourth-quarter lease contract review right now, consider using a tenant rep for doing the various tasks that’s required.
Planning
Tenant reps work with your architect or space planner, attorney and key executives to target the best location, amenities, size and configuration that meet your company’s needs both now and for the future.
Location Search
Searching for available space includes research into facilities that may become available. Often the best space is not currently vacant. The tenant rep’s business is to know of vacancies before they exist.
Research activities include
• Contacting all applicable landlords and brokers
• Broadcasting the client’s space requirement via various industry and trade media
• Networking with brokers and landlords.
This work gives you the maximum number of location choices.
Market Research
Once the search process is done, the tenant rep inspects sites and compares their market rates and terms. This market research gives you information on which to make a decision on the best price and terms.
Negotiation
Once you have decided on one or more facilities to pursue for a lease, the tenant rep will prepare and issue requests for proposal (RFPs) to applicable landlords or issue letters of intent (LOIs). The responses are then analyzed and in-depth lease negotiations are performed.
Lease Renewals
Up to a year before your lease expires, your tenant rep will research the market to determine fair renewal terms, including new landlord upgrades and new lease clause protections.
(Editor’s note: Adapted from “Working with a Tenant Representation Firm.” For a complete copy, go online to commercial-real-estate-tucson.com/resources/working-with-a-tenant-representation-firm/)