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  3. Does a Tenant Rep Cost or Save You Money?

If you are working directly with the broker who has the sign on the building, make no mistake about it, you are working with the landlord’s broker or agent. Their loyalties are to the landlord not to you.

Landlords would prefer that you work directly with their broker or agent, and that you do not have your own representation in the transaction. Tenant Representatives help you get a lower lease rate through using their knowledge of leasing, and through providing other alternatives which will give you leverage in the negotiation process. Further, professional Tenant Rep will get you better terms when it comes to renewal rates, expansion option and Tenant Improvement allowances.

Who pays the commissions? A Tenant Reps’s fee is generally paid out of the listing commission that the landlord has already ‘baked-in’ to their rental rate pricing. If their is not Tenant Rep, the landlord’s broker generally walks away with the difference. It does no inure to the benefit of you, the Tenant. In that situation, you, the Tenant, end up a paying higher rent, and you are left without brokerage representation and advocacy.

For these reasons you should not buy into the myth that working directly with the Landlord or their broker will get you a lower lease rate and a better overall deal.. In reality, the opposite it true.

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