Working with a tenant rep in a commercial leasing transaction is a very smart decision. A tenant rep, also commonly referred to as a tenant advisor, will go above and beyond to take the stress out of the commercial real estate transaction process for the tenant. Their primary role is to essentially run the process from start to finish so the tenant doesn’t have to. If that explanation still feels a bit broad, let’s take a deeper dive into some of the tenant reps’ responsibilities.
Needs Assessments
Upon agreeing to work with a tenant, one of the first things a tenant rep will do is a needs assessment. This process is a rep’s way of learning everything that they possibly can about their client’s business. From the information they gather during this time, they will be able to more accurately determine how much space they need, how they will accommodate any future growth, the right area to look for space, the type of property layout that will best suit the business and more!
Site Selection
Armed with the information from their assessment, a tenant rep can now take the next step in finding their client the perfect property. Based on the needs that were identified, they will begin the process of vetting out available properties in the local market that most closely meet them. An experienced rep will also use this time to reach out to the listing agents to make sure the terms being offered are flexible enough to fit the client’s criteria. They will then sift through each one to narrow down the choices to a few top picks that check the most boxes.
From here, a tenant rep will begin scheduling times for their client to tour the remaining properties. Their main job in this process is to ensure the client is accurately noting how this property could benefit their business and in what ways it may not be the best choice. They’ll make sure their client is considering factors such as parking, quality of the building, infrastructure, layout, lighting, amenities and more.
Negotiations
After touring as many properties as they need to in order to help their client make an informed decision, it will be time to choose which one the client would like to make an offer on. The tenant rep will be there to advise their client where to make concessions, where to ask for more, what their rights are in the process and so much more. The process will begin by the tenant rep sending out a formal request for proposal. This document outlines the initial terms that the landlord is willing to offer and is completely non-binding. It is, however, the foundation for any negotiations that will take place. After sitting with the tenant to determine where changes may need to be made, the tenant rep will send back a letter of intent, which is essentially a counter offer outlining which of the original terms they agree to and where they would like to see changes and/or upgrades. This is also a non-binding document. If the document is approved by the landlord, negotiations will ensue to see where further compromises can be made so both parties are happy with the end result. A tenant rep is an integral part of this process, in constant contact with the owner/landlord to guarantee their tenant gets the fairest deal.
Questions
The tenant rep will be with their client throughout the entire signing process to make sure every question they have is answered and that they fully understand each document they are signing. The relationship between a tenant and a tenant rep does not, however, stop there. A tenant rep is there to answer any questions that might arise throughout the duration of the lease. They are also there to assist should any need arise for space expansion or the ability to sublet all or part of the space in question. Additionally, tenant rep’s can be a great bridge between a tenant and a difficult landlord. They will go to bat for the tenant to ensure they are being treated fairly and ethically throughout the length of their lease.
Lease Expiration
At the lease term, a tenant rep will, once again, prove to be a valuable part of the commercial leasing experience. Before a tenant chooses what they would like to do moving forward, a tenant rep will be there to ask them all the right questions that will help them to make an informed decision about what is best for their business when it comes to the space in question. There will likely be another needs assessment and from there, either the process of finding a new space will ensue, re-negotiations will begin on the existing space or a new lease following the same terms will be signed.
The role of a tenant rep is extremely important and can truly make the commercial leasing process exponentially smoother and less stressful for a tenant.
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