As a tenant in a building you may think it’s a good idea to negotiate your own commercial real estate lease directly with the landlord. You may even recognize the landlord’s broker faces a conflict of interest when he claims to serve both the landlord and tenant at the same time. You’re probably thinking, you have to pay your broker a fee.  You may also think that the landlord will pass the savings of not paying an outside broker over to you  as an existing tenant leasing office space in his building. Well, I’m here to tell you that you would be wrong. First of all, a tenant broker gets paid from the landlord and acts on your behalf as your consultant without receiving a fee from you. Also, an agreement is already in place between a landlord and the landlord’s broker regarding both sides of the commission. This commission rate is already baked into the lease rate.  So, by not having your own representative at the table negotiating the best deal possible for you, you will basically allow the landlord to get the most favorable deal possible while having the landlord’s broker get paid a larger fee. There is essentially no incentive for the landlord’s broker to negotiate the best deal possible on your behalf, as his fiduciary duties are owed to the landlord. So, the next time you are seeking to move or renegotiate your lease, make sure you hire a tenant representative broker first.

by: Ana Sandomire, Broker Associate