Each has a specific function and duty. Make sure you pick the right person for your commercial site selection needs.
You want to save time and money when it comes to selecting, negotiating and signing a commercial real estate lease or purchase. You want someone with expertise in the office, retail or industrial market that interests you.
In short, you need a commercial real estate broker, whether you’re looking for property in Tucson, Arizona or anywhere else in the world.
A qualified commercial property broker will
- do much of the grunt work
- possess deep market knowledge and market information
- have strong problem-solving and negotiating skills.
Agents vs. Brokers
Choosing the right representative starts with understanding who can best represent you.
Agent. Agency is an action; if a real estate licensee, including a broker, acts as your agent, that person becomes your agent.
Commercial Real Estate Broker. A broker owes you a fiduciary duty, an absolutely faithful duty to perform in your best interest and to do no harm.
Real estate brokers are either specialists or generalists.
Brokers are paid once the transaction is complete. They do not get paid if the transaction fails for any reason.
Commissions are calculated in two ways:
- a percentage of the rent for all the years of the lease. The amount declines with the length of the lease.
- a certain number of dollars per square foot based upon the lease term. The amount declines at fixed stages for the length of the lease.
Commercial Leasing Brokers
This is a specialty among commercial real estate brokers. These brokers fall into two categories:
Full-Service Brokers serve as agents for both landlord and tenant. They receive and initiate transactions. Full-service brokers often work on more transactions than their tenant rep counterparts.
Full-service brokers often work in dual agency, meaning one agent works for two opposing parties—the landlord and the tenant—in the same transaction. Dual agency must be disclosed and all parties must agree to accept the dual agency scenario.
Tenant-only representatives, such as Commercial Real Estate Group of Tucson, serve only the interests of tenants, not landlords. Any broker, even a tenant rep, can inadvertently become a dual agent in a transaction by performing an agency action for the other party.
Choosing a Broker
Take into account these factors when considering who to hire as your representative:
- Consider the depth and the volume of experience.
- Select one qualified specialist in the area and type of property you desire. Enter into an exclusive agreement with that broker.
- Select someone who will put you in control of your lease transaction since you are the one who will live with the lease.
- If someone is representing a property you’re interested in, ask if that person is an agent or an employee of the owner. You might want to opt to get your own tenant rep.
- A broker who has properties listed or is working with another tenant with the same needs may not have your best interests in mind, as wonderful as that person might be. Determine if the broker is representing you or the landlord when the broker shows those properties.
Hiring a Broker
- Select one broker and enter into an exclusive agreement with that person.
- Put your agreement with your broker in writing.
- Include the right to terminate the agreement on five to 10 days’ written notice.
Contact Commercial Real Estate Group of Tucson for more information. Its brokers will explain how a commercial real estate broker works and why tenant representatives can find the best lease or purchase deal for you.
Commercial Real Estate Group of Tucson specializes in representing tenants and corporate users across the United States, Latin America, Europe and Asia as a member of ITRA. For more information, call 520-299-3400.