BOOK of LISTS

Tenants need an advisor with in-depth knowledge of the specific markets in which they’re interested. When deciding between multiple locations, narrow the choices to those that best fit your organization’s particular needs and use a broker with experience and first-hand knowledge of those desired locations.

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1. What locations, cities, or specific neighborhoods are you most familiar with in your practice?

Tenants need an advisor with in-depth knowledge of the specific markets in which they’re interested. When deciding between multiple locations, narrow the choices to those that best fit your organization’s particular needs and use a broker with experience and first-hand knowledge of those desired locations.

2. Where do you see the market going right now?

This question is another way of asking whether the markets are expected to be moving up or down in the near future and to get a better understanding of the broker’s knowledge of market fundamentals. Market knowledge and the ability to leverage information is critical for a tenant, as it ultimately determines whether lease terms are more favorable for the tenant or landlord relative to current market conditions.

3. What is your experience as a broker?

Just as they would with an investment advisor or lawyer, a tenant should never hesitate to ask brokers about their experience in the field, including a list of past clients, industries served, office sizes, and anything else deemed important. Also, when addressing work experience, it’s usually a best practice to focus on a broker’s number of completed deals rather than years of experience. It’s almost always preferred to have a broker consistently active in the market rather than one semi-active for a longer period of time.

4. Can you share some of your success stories?

Ask commercial real estate brokers to share specific examples of hurdles they have helped other clients overcome. True expertise shines in the face of adversity, and you want to know you have the right resources on your side.

5. Do you specialize in specific types of office space?

Certain brokers have developed specialized expertise with particular office types, including retail, warehouse, industrial, and office space. If you have specific demands that would benefit from such a specialization, seek out a broker with the type of expertise that would add the most value for you.

6. Have you negotiated a tenant improvement allowance and worked through a build-out before?

Although tenant improvement allowances are standard in many commercial leases, you shouldn’t assume any particular advisor has significant experience with them. Given the potential importance of improvement allowances to lease negotiations as well as your satisfaction with your new office space, always confirm an advisor has sufficient experience with them if you expect to request them as part of your lease agreement. Office build-out negotiations can be incredibly tedious and time-consuming. If you’re expecting to need a build-out in your new space, a broker with significant experience in build-outs can make the process significantly more streamlined and efficient for you.

7. Have you ever worked with a company like mine before?

No two companies are built alike, and the specific needs of your company won’t be like those of any other company out there. However, finding a broker who can draw on past experience will provide insight into your requirement.

8. What about real estate interested you in the first place?

Personal and professional passions can be extremely enlightening regarding advisors’ commitment to their craft and client base. Try to gauge advisors’ sincere desire to help people and their organizations as well as more quantitative metrics like their problem-solving skills.

9. What will your broker services cost me?

It’s standard practice for a broker’s compensation to funnel through the property or landlord as a commission contingent on lease execution. However, there are exceptions to this practice, where a broker might charge for a one-off project like reviewing a lease. While these are far less common, they are worth asking about.

10. Do you represent any buildings or landlords?

Representing multiple parties can naturally lead to conflicts of interest or bias. It is typically preferable to use a broker who works exclusively with tenants to avoid such pitfalls.

Source: Mike Zei is the COO & Co-Founder of TenantBase. TenantBase is a technology- enabled commercial estate brokerage with online tools built specifically for small business. Mike can be reached at mike@tenantbase.com.