Finding the right premises is one of the most important factors for your company’s success. Your property and its location have an impact on everything from your brand perception to your staff satisfaction – from your ability to expand to your monthly outgoings. So it makes sense that when you’re looking for the right property, you’d get an expert on board to help. This is where a tenant advisor (or tenant rep) comes in.
What is a Tenant Advisor?
You could think of tenant advisors as being opposite to leasing agents. Leasing agents are appointed by the landlord to market their property and get the highest possible rent. A tenant advisor is a professional who works for you, the tenant, to help source and negotiate a lease for the property that best meets your business needs.
If commercial property landlords are hiring professionals to negotiate a price and navigate the process for them, why wouldn’t you as the tenant do the same?
Engaging a tenant advisor can bring a number of benefits, which include:
On average, businesses makes a property decision once every 5 years. It’s unlikely therefore, that the typical (or even not so typical) business owner will have a detailed knowledge of the current property market. Landlords and leasing agents will use this to their advantage, and they often employ a number of tactics to win a higher price when negotiating with someone who doesn’t know the industry as well as they do. A tenant advisor will be up to date on the true current market rates, so they’ll know from the outset whether the terms of a lease are appropriate. They’ll also know the negotiating tricks that a leasing agent might use, so will help you avoid these to get the best deal. In essence, by hiring a tenant advisor, you level the playing field from the beginning.
Greater Market Access
Search for commercial property online and the results that you see almost certainly won’t tell you the full story. Some listings may well be out of date – a common ‘fishing’ tactic used by leasing agents to pique your interest before showing you another property. All too often, this ends up wasting your time.
A tenant advisor will know which properties are legitimately on the market, and which listings are out of date. What’s more, they will have extensive networks within the property industry, and will often know of available properties that have not been publicly listed yet, giving you the chance to get in early on a prime location.
Finding the right property takes time. A typical new tenant will view around 20 to 30 properties, listed in multiple agencies, before making a decision. All this requires research and coordination, not to mention time away from the office for the actual property inspections. Most companies will appoint a tenant advisor to coordinate the entire process, from collating all the available options in the market, to organising inspections, negotiating the most favourable terms across multiple buildings through to working with your appointed legal team on the lease documentation. This enables you to focus on your core business.
Leverage in the Renewal Process
A tenant advisor isn’t just for when you are relocating; they can also be engaged when you are negotiating the terms of a new lease as well. Indeed, to achieve the best outcome in this situation, it is advisable to approach the renewal process in the same way that you would if relocating. If a landlord feels there is a genuine chance of a tenant leaving, they are more likely to offer concessions. A tenant advisor will be well versed in this process and can present you with genuine alternatives to your current lease, thus giving you more bargaining power in the lease renewal process.
The lease negotiation process can sometimes involve tense conversations as both sides hold out for the best deal. This isn’t necessarily ideal when you’re hoping to have a good relationship with this landlord for the next five years. A tenant advisor will do all this ‘dirty work’ for you, meaning you can start (or continue) a relationship on good terms with your landlord.
Landlords and leasing agents often prefer to deal with tenant advisors anyway, and many will have pre-existing relationships with your tenant advisor from previous deals. Often it will be the strength of these relationships, rather than any hardball negotiating tactics, that can win you the best deal.
While you may have a good idea of the space your business will need, a tenant advisor can bring a fresh, experienced pair of eyes to your situation, and will be able to provide advice on whether the kind of space you have in mind really matches your business trajectory and values. They might see how your business is growing and recommend you take a larger space to avoid another costly move in the near future, or find ways you could economise on space and save money. A good tenant advisor will act as a partner in your property acquisition process, working with you at every stage to ensure you get the best deal for your needs.
At Meta5, we provide tenant advisory services as part of our comprehensive commercial property offering. If you are thinking of relocating or have a lease for renewal, contact us to see how our tenant advisors can help.
Patrick McFarland, firstname.lastname@example.org