Individual research and perseverance can knock thousands of dollars off the cost of a real estate deal, and companies and organizations are increasingly inclined to explore the idea of searching for space without a broker. But is it worth it to sift through hundreds of local listings and suit up for negotiations without professional expertise? Here are three things you need to know about when deciding whether to tackle your office search on your own:
Market Knowledge:
Market conditions are constantly changing and opportunities are found and lost on a daily basis. Because a commercial real estate broker processes hundreds of opportunities each day, they often know which buildings are immediately available, as well as any restrictions, zoning issues, or other proposed development projects in the search area. They are familiar with neighborhoods, trends, and even local business owners and landlords--all information that you might not be aware of as an outsider. That being said, much of this market information is published on the internet and made available to the public, meaning it is easier than ever to do your due diligence in 2014.
Time Management:
If you are a business owner or manager, you usually have your hands full running the day to day operations of the company. By engaging the services of an experienced commercial real estate broker, you can maintain your focus on their business while obtaining the benefits and guidance of real estate professional in quantifying and securing their new facility.
Cost Savings:
Brokers have financial motivation for your lease to be more expensive and your lease term longer, as their commission will improve as the total lease amount increases. However, cost savings also can be gleaned by virtue of the broker's market knowledge, access to privileged information, and skill and experience at negotiations. Brokers want to earn a high commission, but they also want their clients to be satisfied. You might be able to successfully navigate the process on your own, but you might miss important market information a broker could supply that would minimize costs as the business expands. Also keep in mind that a commercial real estate broker negotiates for a living, and serves as a mediator between the landlord and the client. Negotiations and leases can be complex, and it is helpful to have an advocate on your side that can spot one-sided clauses in the lease.
Whatever you choose, remember how important it is to understand the different roles brokers play, and to carefully weigh the advantages and disadvantages of using an intermediary when searching for office space. With the tools and information now at your fingertips, you have options. Trust your instincts, and seek help when you need it.
