INCREASING numbers of tenants are calling on professional services to help them negotiate a better commercial lease.
Be it avoiding a requirement to pay the landlord’s legal fees in a lease dispute, or negotiating a ‘make good’ clause that demands tenants spend thousands of dollars when exiting an office space, tenants are looking to secure the best outcome possible.
During 2003 and into 2004, Perth’s premium sector will experience a peak lease expiry period and many companies will want to bargain with property owners or developers for a better deal.
On top of rent-free periods and fit-out deals, other issues on the table include maintenance responsibilities, rent market reviews and exit costs.
Stepping in to negotiate for the best deal on behalf of the tenants are tenant advocates, an emerging force within WA’s commercial lease industry.
Tenant advocates advise and represent tenants during the process of securing a new or improved property lease.
A tenant advocate service can include needs analysis, broad market search, management of property selection, financial analysis and comparison modelling, and the appointment and management of other consultants. They also will deal with the final lease documentation.
Grant Samuel head of tenant representatives and associate director, Matthew McNeilly, said that, unlike commercial real estate agents, tenant advocates only represented a tenant’s interests.
“The whole premise is based on independence, advising and representing the tenant, never the landlord,” he said.
“Tenant advocates were born out of tenants wanting no conflict of interests.”
Grant Samuel represented tenants ranging from 500 square metres to large blue-chip clients, Mr McNeilly told WA Business News this week.
“Perth is a landlord friendly town and I think the level of knowledge and experience we have is reflected by the tenants we represent,” he said.
Mr McNeilly said he expected to pick up many new clients during the next six to 12 months that had not used a tenant advocate before.
Feinauer and Associates principal Dirk Feinauer said a commercial lease was not the simple document many people believed and tenants required professional advice when entering into a lease.
“The lease is the foundation of the entire business and we look at the commercial impact of the wording on a lease,” he said.
© Business News 2017. You may share content using the tools provided but do not copy and redistribute.