How to Make the Most Informed Real Estate Decision: Work with a Tenant-Only Representative
By James (Jay) Rigelsky on May 3, 2017
Consider your experiences purchasing a car.
Would you purchase a car from the same salesperson that will be financing your loan?
For example, car dealers offer various incentives to entice you to buy a car. They offer instant rebates, new buyer discounts and free maintenance for a 6-12-month period. Let’s say that the salesperson has piqued your interest and factored all these incentives into the sales price; he then presents you with one more option: incentivized financing if you purchase your car through the dealer.
How can you feel certain you have negotiated the best out-the-door price for your new car when the same person giving you the incentives is offering to finance your new car for the life of its loan?
In my personal experience, I have found upfront incentives are often diminished when the same entity providing the incentives will be accepting my monthly payment.
This same scenario often unfolds in the commercial real estate world where landlord representatives and landlords collude to provide incentives to tenants who are looking to lease space, and then recoup those costs through monthly rent payments and operating expense reimbursements.
How can you as a tenant ever be fully confident that a company offering to represent your interests is ever going to candidly give you the best lease terms when they also represent landlord interests?
As in the new car scenario, office space incentives often make the monthly price look attractive, but when considering the cost over the life of the car, or in this case, the lease, you often find that when you go to trade in or relocate………
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The most effective way to ensure that you don’t end up upside down is to seek out the most independent and intelligent market data available, and that data is often only available from those with no ties to landlords — i.e., independent tenant representation firms.
By working with a knowledgeable tenant-only representative, you gain valuable insight and confidence that you have an advocate working on your behalf whose goals and objectives are perfectly aligned with yours.
This eliminates conflict of interest and you gain a partner you can trust.