If you have an upcoming lease expiry or have recently made inquiries regarding commercial office space – you’re likely to be inundated with varying agents, looking to help you with the leasing process. But with the influx of information from a range of agents, it’s hard to know who to listen to or know the best direction for your business. So, we’ve outlined the key information and our tips to help you navigate this journey.
Whereby the agent works within a team who service the leasing requirements of landlords. Agents in this situation generally focus on a particular “patch”. This patch can be defined by geographical location, asset class (e.g. Office, Industrial, Retail) and/or transactional value. These agents may work on behalf of many landlords, but generally have longstanding relationships with Institutional Landlords and Property Funds such as Dexus, Goodman, Charter Hall, Mirvac, etc.
Whereby the agent is employed directly by a Private Landlord, Property Fund, Institutional Landlord or similar and acts specifically on behalf of their employer.
Whereby the agent/broker seeks out opportunities to act on behalf of landlords. These agents may have relationships with some landlords, but generally, have no longstanding relationships with established Institutional Landlords or Property Funds.
Regardless of which “category” an agent falls into, there is one thing that all agents have in common, and that is that they are all mandated and remunerated by landlords to maximize the rental return and complete transactions on behalf of landlords.
Commercial Leasing Agents have significant expertise in the leasing process which includes but is not limited to:
Commercial Leasing Agents are generally well versed in current rentals, vacancy rates, and recent transactions – this information is valuable, where accurate, in benchmarking any new lease agreements you enter.
Commercial Leasing will be familiar with the intricacies of the buildings they represent, as well as the competing stock in the market.
Familiarity with the landlord, understanding of what drives their decision making. Many institutional landlords and property funds have financial formulas that need satisfying to sign off on deals. Commercial Leasing Agents appointed to represent these landlords will have a general understanding of these metrics.
Commercial Leasing Agents have experience over a high quantity of varying transactions, allowing them familiarity with the obstacles either party may face in reaching an agreement, as well as an understanding of key commercial, and non-commercial terms of the lease agreement.
The best way to ensure your interests are protected is to appoint an independent tenant representative or advisor.
Why would you not arm yourself with the same tools that a landlord does, by appointing someone to represent your best interests?
Appoint an independent Tenant Representative or Tenant Advisor who will:
Commercial Leasing Agents are a necessary part of any transaction and can add significant value to your leasing process. It’s important, however, to understand the motivation behind a Commercial Leasing Agent’s activity – a Commercial Leasing Agent is appointed, and paid, by a landlord to represent the landlords best interest.
The only way to truly ensure your interests as a tenant are protected throughout the leasing process is to arm yourself with the same tools as the party on the other side of the transaction (Landlord represented by Agent), by appointing a Tenant Representative or Advisor.
If you would like any further information, please don’t hesitate to contact PCG.