Thursday, March 3, 2011

10 Leasing Insights - Tip #7

J. Michael Hoeck, SIOR Industrial SpecialistPosted by: J. Michael Hoeck, SIOR
Industrial Specialist
775 336 4621

Mike began specializing in industrial brokerage with Colliers International in 1999, and in May 2005, joined Alliance Commercial as a Partner and as Vice President of its Industrial Properties Group. In May of 2007 Alliance Commercial became NAI Alliance and Mr. Hoeck became a Senior Vice President.

~10 Leasing Insights ~
Broker tips to better deals

Tip # 7
Representation (why choosing an agent to represent your interests helps)

Can you think of a single complex task you got 100% right the first time around? Sure, it gets done, but by the 10th time through it gets done much better (and quicker), and by the 100th time you’ve worked through almost every eventuality. The challenge in representing yourself in lease negotiations is that you only do it every 1 – 5 years. Typically, your landlord is likely more practiced and has an information advantage based on their experience as well. What’s a tenant to do???? You can hire a broker to represent your interests in the transaction. A broker (or better yet a team of brokers) typically has the experience from seeing lots of deals, and they can often avoid pitfalls you might not have thought to address.

BROKER INSIGHT: When a tenant is clearly represented by a broker, and there is a trust between those two parties, deals which are outside the formal Commercial Leasing Market can get done. If the perfect space for a tenant is somehow in a grey area (say it won’t be vacant for another 3 months), but a broker knows the tenant will protect them absent a landlord’s listing agreement, maybe a better deal gets done that otherwise wouldn’t have. These grey area deals can be great. They can also be a disaster. Without a broker you really trust, it would be difficult to know the difference.

Next Tip.... Trade Fixtures vs. Tenant Improvements

Last Tip... Option to Purchase

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