Rating Your Landlord – But do you even know who they actually are?
Many times I hear from clients and tenants that this landlord or that landlord is good or bad, helpful or not helpful. But who is your landlord?
In a recent presentation to a real estate group I posed that question for discussion. There were a lot of layers that were pulled back before the real answer surfaced.
The owner of a building we were visiting was listed as, “OC-4-South Coast, LLC.” That entity was likely composed of dozens of investors in this property and most likely part of larger portfolio managed by an asset manager located somewhere else in the country. The landlord hired a local listing broker to market the property and to negotiate the general terms as the wind blows.
Once a lease is drafted an attorney reviews the document to make certain it confirms with the agreed upon terms as well as any modifications requested by the tenant. After that step is completed the documents are signed and the property manager takes center stage. In my opinion, after many years of experience, the property manager becomes the day-to-day real landlord in deference to your building’s true owner.
When you have issues on your premises, whether it is a maintenance issue or a compliance matter with the lease, the property manager most certainly is the contact person to resolve the issue. As a tenant broker it is my job to serve my client. I typically handle those situations on behalf of my clients and over the years I have seen the best and the worse of these situations.
As a broker, I exclusively represent tenants and I am obligated to show all spaces available that meet my clients’ needs. If clients of mine in the past have had bad experiences with a property manager I have an obligation to disclose this information to my client. It is not unusual that this information will completely negate that property.
At times complications occur in your transaction because it was negotiated with a broker, the lease drafted by an attorney and the document handed to a third party to interpret and enforce.
Too often in lease negotiations, I hear the other side saying things like, Oh, it’s a “standard” form; just sign it” or perhaps they will retort, “Don’t worry, that will never happen.”
One prominent property owner I have dealt with has a reputation for being a very difficult and lord to work with. The common perception is that they are tough on both their pricing and lease negotiations. On the other hand, some my clients who occupy space in their properties rave about the property management as well as the ease of completing the deal once the process began. As evidenced in another transaction everything went quite smoothly during the lease negotiation phase. However every time an issue surfaced once the lease was signed the property manager put their foot down and said, “No,” claiming that they were interpreting the Lease through their own lens and that was that.
Two conclusions can be reached First, no matter how small your premise, negotiate every detail in the lease that might impact you knowing that a third party will be interpreting it at some point. Whatever you may think will never happen is likely to occur at some future date. Second, get to know your property manager. They can make or break your tenancy. When you are looking at space, be sure to stop by other tenants in the building and ask them their opinion about the property manager.