Is Your Broker Your Consultant or Just a Deal Maker?
To most, the function of a commercial real estate broker is to simply identify a space and negotiate basic terms. On the other hand, at IN/House, we believe a broker should serve as a consultant for all real estate matters throughout the term of a lease or ownership.
Our clients engage us because they understand they do not have either the knowledge of the complexities of commercial real estate or they simply don’t have the time to address the myriad of issues that come up from time to time related to their tenancy.
Unfortunately, while our clients may understand our unique value proposition, there are often others involved in both the transaction or lease management who still need to be convinced of the value of that additional service. That often includes clients’ attorneys and time many times, property managers.
Recently, we received a referral from an existing attorney client. He gave us a very positive recommendation and raved about our ongoing and continuing service particularly after the transaction was completed. The potential client was more than excited to meet. I presented my Authorization Agreement along with the State mandated 2079 representation disclosure form.
In our follow-up meeting I reiterated that:
We exclusively represent tenants/buyers.
Our agreement is a business contract and NOT a listing agreement.
We provide ongoing services, after the transaction is completed.
Compensation comes by sharing the listing agent’s broker commission paid to him by the landlord. (That agreement is also a business contract and NOT a listing agreement.)
The initial six-month term converts to a month to month agreement which can be cancelled by either party at any time.
However, when I received the signed copy of our Authorization to Engage Services Agreement back, their attorney deleted the section outlining our on-going services and the month to month continuing agreement.
Despite what the referring attorney/client had offered as a recommendation, he couldn’t understand why a broker would continue to service a tenant after a deal was done. In discussing the matter with him, his static perception remained that an agent listed property, sold or leased it, then went on to the next deal.
We are often asked what can go wrong after the leases are signed. We get that question asked so often we decided; besides our Blog, that we are doing to post a daily, well, almost daily, issue or problem that comes across our desk. Initially we referred to it as the “Problem of the Day” but many of our clients who saw the posts noted that we are problem solvers.
With that said, look for our “Solution of the Day” on our Linkedin, Twitter or Facebook feeds.
In the meantime, don’t be afraid to ask your broker for help on any real estate matter. They have likely been paid handsomely to handle your transaction. The fee was paid by the landlord to his listing broker who then shared the fee with your broker. Understand that the broker is a licensed professional and works in real estate all day while likely, you don’t. I’m sure they would love to help, but you need to ask. Remember too that it is YOUR money so be sure you are getting the full value of your investment.