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Recent Articles

Is Your Broker Conflicted?

Mark Bowman, June 2024

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It is no secret that there are frequent conflicts of interest in the commercial real estate industry when it comes to how brokers represent their clients and how they are compensated for their services. The most glaring conflict is the Conflict of Representation.

 

Most real estate brokerage firms, and certainly all of the national brokerage firms, are retained by building landlords and owners to manage and lease up office buildings. A major conflict arises when these firms attempt to represent the interests of tenants while servicing their primary client, the landlord.

 

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Renewals & Renegotiations: Do I need a real estate broker?

Mark Bowman, October 2024

 

While commercial tenants (office, retail, and industrial) tend to retain a real estate representative when they are planning a relocation, nearly half of commercial tenants opt to "go-it-alone" when re-newing or renegotiating a lease.  In a survey of tenants considering renewal or renegotiation of a lease, the three most popular reasons for acting without representation were as follows:

 

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Negotiating Operating Expense Clauses in Office Leases

Mark Bowman, November 2023

 

During lease negotiations, office tenants tend to focus most of their time negotiating base rent, annual escalations, free rent, and tenant improvements.  While these terms are fundamental, the operating expense provision of a lease can often result in significant additional expense to the tenant over the course of the lease term.

 

In a net deal, tenant is typically required to pay its pro-rata share of the building’s operating expenses (common area charges, insurance, maintenance, landscaping, taxes, etc.).  In a gross deal, tenant usually pays its pro-rata share of only the increase in operating expenses over a base year which is typically the year the lease was executed.

 

(please email us for a full copy of this article)

 

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