Landlord Agents vs Tenant Representative When Leasing Commercial Real Estate

tenant rep vs landlord repUnless you do it everyday leasing commercial real estate can be complicated. Because these commercial leases are such a big deal, it makes sense to have a professional in your corner.

Who Represents Whom in a Commercial Real Estate Lease?

A long time ago it was common for a commercial real estate agent to put up a for lease sign, show the space, receive offers, and close the deal.

Most of the time tenants thought that the commercial landlord agent had their best interests in mind or at least was neutral to the deal when in reality the agent represents the best interests of the landlord.

These days most landlords (aka lessors) and tenants have their own representation. It makes total sense because lessees of property want to get the best terms and lowest lease rates as possible, which absolutely conflicts with that of landlords and commercial property owners who want to get the best terms and highest lease rates possible.

Understanding the Commercial Real Estate Market

In the U.S. each state has its own set of rules for commercial real estate transactions. Lease contracts, closing steps, and the responsibilities of everyone vary.

Commercial real estate leasing info is shared by agents using multiple online platforms such as Costar, Loopnet, Xceligent, etc. Consumers are able to access some of the information with only Loopnet and if they pay for it they can get full access. This  creates a disadvantage for tenants who want to know more about what is available and at what price.

Tenants do not have to pay a fee to have a commercial realtor work on their behalf. The Landlord/Owner traditionally pays 100% of the available commissions.

Commercial real estate agents have to be licensed to represent landlords and tenants in commercial lease transactions. 

The Commercial Landlord Representative

Because Landlord reps market properties for lease and have signs posted everywhere on buildings or online it’s not uncommon for a tenant to contact them directly.

When you are a tenant it’s important that you understand that your are contacting the landlord representative.

The landlord rep is legally obligated to represent the landlord’s best interest.

The landlord agents primary responsibility is to market the property, attract potential tenants, and work to get the highest lease rates and best terms possible for the building owner. They are not allowed to tell you how low the building owner is willing to go or how badly they need to lease space, or anything else that would put the building owner at a disadvantage.

Landlord Representative Responsibilities

The following are the duties of the landlord representative:

  • Properly value and price the landlord (lessor) or building owners property for lease
  • Suggest improvements or repairs
  • Develop effective marketing campaigns
  • Show space to prospective tenants 
  • Receive, present, and negotiate offers on the lessor’s behalf
  • Draft proposal for the owner or lessor as well as counter offers
  • Help the owner or lessor get the best terms and highest rents as possible

As a building owner seeking to lease your commercial space, the landlord rep is your biggest advocate.

The Tenant Representative

The tenant representative represents the tenant’s best interest in a commercial lease. They put the business or company’s needs first that is leasing commercial space. He or she educates the lessee and shares info in a way to put them at an advantage in the negotiations. And the tenant rep will provide any other info known to help them get the lowest lease rates and best terms possible.

Tenant Representative Responsibilities

  • Help the tenant search for properties
  • Provide the tenant a list of commercial space that match their needs
  • Unbiased advice on lease rates, market conditions, commercial properties, etc
  • Tour with tenant the best options
  • Draft all loi’s and lease proposals
  • Negotiate against the landlord to get the best terms and lowest rates possible
  • Review lease documents
  • Help coordinate construction bids, et

If you are looking to lease office space in Austin, Tx or need to rent Austin warehouse space in Southeast Austin feel free to give us a call for help.



Scroll to Top