Can’t You Just Use A Commercial Real Estate Agent?
If you hire a commercial real estate agent to find you just the right space, he may tell you that he will represent you in the negotiations for the lease on that space. But you need to be aware of several things before you proceed without using the services of a lawyer.
Most real estate agents are not lawyers; they are not trained in the minutia of contract law. In fact, real estate agents cannot even pretend to represent you in any legal way, because that would be practicing law without a license–a crime in most states. But your future landlord is definitely using a lawyer to draft that lease and advise the negotiations process. That creates an imbalance of knowledge and power in the negotiations over the lease.
The agent you chose will be paid by the landlord when the deal closes, not by you in advance. So ask yourself where the agent’s interests lie: In getting you the best deal, or making sure the landlord pays him a commission? Rent abatement is not uncommon for a period at the beginning of a lease, but that costs the landlord money in addition to the commissions he has to pay the agent. Do you know how much commission the landlord will pay the agent, and are you sure the landlord would not have given you more concessions if he didn’t have to pay that amount of commission?
You most likely will have an emotional attachment to the space your agent found for you; how will that affect your judgment and the judgment of your agent during negotiations? On the other hand, your attorney will be completely independent and will be able to provide you an unemotional analysis of your risks during the lease negotiations.
Our focus is on finding commercial space to lease for new or expanding businesses, then negotiating the leases. This unique one -stop shop should produce better results for tenants than using a commercial realtor who is not a lawyer to find space and begin negotiations, even if the tenant eventually engages a lawyer at some point in that old process. We’ve done lease review for quite a few businesses—some moving, some expanding, some buying existing businesses—including one restaurant owner who is expanding to multiple locations. In addition, we’ve noticed that when we can get to know business owners we can provide better overall tenant services because we are attorneys (and Anjali is an attorney-realtor).