Commercial Property: The Rise Of Tenant Representatives
Tenant representation in the commercial real estate sector seems to have become standard practice, especially abroad. This has now started to gain traction in South Africa too, as there is a boost in the complexities of negotiating commercial leases. This is according to Greg Huntingford, the CEO of Spire Property Management.
Spire is anticipating that tenant representation will continue to grow in popularity, while also moving into the mainstream of commercial real estate in South Africa. This is because more people are looking for space, and realizing that they need a property consultant to best represent their needs and interests.
“Already we are seeing more and more commercial real estate (CRE) tenants in SA appointing a CRE representative to protect their interests when negotiating the details of a lease agreement,” says Huntingford. The role of a tenant representative is frequently less about assisting a person in finding suitable space, than it is to provide advice, exclusively represent and negotiate the interests of the tenant.
The Rise Of The Smarter Tenant
“Potential tenants are getting smarter about bringing their own representation to the table, and an independent view to guide a tenant is important. The problem with a non-specialist trying to negotiate their own leases is they almost never know what constitutes a good rental agreement, and a tenant representative can do just that,” says Huntingford.
In an era of increased specialization, few people in commercial real estate has as much expertise in it than tenant representatives. The tenant representation process starts by evaluating and refining the tenant’s requirements. These requirements vary greatly, but are always complex, and frequently require an analysis of the company’s entire portfolio, while also determining the market conditions. These are only a few of the many reasons why so many companies are turning to tenant representatives to help them find the best premises for their businesses.
Image courtesy of : Spire