When you work for tenants in commercial real estate the listings and the opportunities work in reverse. You are the agent looking for the space that your tenant client needs. You act for the tenant and they pay your commission. That’s a good thing, however it is a specialised service.
The logic works well if you are focusing on the bigger end of the tenant market in any city and particularly the larger companies and businesses. This can be a very lucrative and specialised part of the property industry. We call this ‘tenant advocacy’ or being a ‘tenant’s agent’.
A key leasing fact
The larger tenants and particularly the successful companies in your city do not have the time or the skill to focus on the information gathering process involved in looking for new space. They are better at other things. They are well served by finding a professional and skilled agent or broker to help them with the leasing process.
I think the leasing focus here should be on the two words ‘professional’ and ‘skilled’. There is no point in working the market segment if you lack in those ways. Corporate clients demand the best service; they also pay well for a positive outcome.
What do you do in the leasing sense?
If this is the market segment for you then consider this phrase, ‘Create the space’. You would then be the leasing agent to find and ‘create the space’ that the tenant needs. The space that you locate has to ‘tick all the boxes’ from a business and occupancy perspective.
There are many things to do in the process and many criteria to fill. Some businesses are very demanding and specialised; you have to know exactly what they need in leasing and why that is the case. A professional outcome is required. Here are some ideas to help you get started with a client to work as their ‘tenant’s advocate’:
- Know the people – Understand who the people are that will have a share of the business decision on relocation. There will be a chain of command to work through and ultimately one person will make the final decision. Hopefully you are close to the person at the top of the ‘decision chain’.
- Know the needs – The basic facts that you should get upfront in the client leasing brief will be timing of the lease transition, area of space, location, building types, services and amenities. This is the raw data. From here you can dig down into greater occupancy detail and all of the particular leasing specifications.
- What do they do now? – You must investigate fully their current business operations so that you know how issues of occupancy impact staff, customers, business, sales, service, and trade. It is a valuable process to visit the tenant’s current business location so you can see how they use occupied space as part of day to day business. Look for the strengths and weaknesses and qualify all occupancy issues so you know exactly how they see and use the space.
- Get specialists involved – With some businesses it is wise to get architects and engineers involved in the fitout design and/or specification stages of the leasing brief. Expert opinion will help you determine and focus on the right physical attributes of occupancy including air conditioning capability, lighting, security, access, communication systems, services, amenities, and building code compliances.
- Budgets – Determine exactly how much money will be required in getting to the new occupancy. That quantum or equation will include relocation costs, lease payouts, and make good costs, new lease rent, incentive strategies, fitout costs, outgoings strategies, and more. Set the budget that takes all occupancy factors into account.
- Lease documentation – There are many choices to be made when it comes to lease documents today. If you are working for a tenant then you should reach a solid understanding of just what they require with the lease terms and conditions. Those facts will include rents, rental structures, rent reviews, permitted use, lease duration, option periods, fitout contributions, and risk management.
These 5 factors will help you get started with any tenant in a role of ‘tenants advocate’. Specialise your services at the top end of the lease market today.