One Page Tenant Representation Agreements Are Useless!

First of all, “Tenant Rep” is simply an incorrect term.  Read about that!

One page commercial occupant representation agreements don’t protect clients or real estate professionals.  They may actually be dangerous!

A commercial occupant representation agreement is intended to reflect the nature of the business relationship between the client (the commercial occupant) and its service provider.   A well-written agreement clarifies the roles, rights, and responsibilities of both parties, and should protect them both.

Commercial Occupant Representation Agreements should clearly define:

  • Who the real estate professional represents
  • The term of the agreement
  • Commencement and expiration dates
  • Services to be performed
  • Events that must occur for the real estate professional to be entitled to compensation
  • The amount the real estate professional will be paid, and by whom
  • A statement about how the receipt of commission by the real estate professional from the landlord will not be viewed as a conflict-of-interest by the client
  • A mechanism for identifying and resolving conflicts-of-interest
  • A provision to extend the agreement
  • Obligations of both parties on termination and post-termination
  • Default, cure, and termination provisions
  • Authorization for the real estate professional to deal with the client’s other service providers
  • Statement that the agreement is governed by the laws and courts of the appropriate state
  • Statement that the parties to the agreement are authorized to enter into it
  • Entire agreement, no amendments except in writing
  • And, don’t forget all that other legal text that’s typically associated with service agreements that, while often lengthy, is intended to protect both client and service provider.

*** The above is not intended to represent a comprehensive list, nor am I practicing law by providing it.  Consult an attorney before drafting or executing an contract or agreement.

Since there exist more issues that are not reflected above, how the heck can you get all that is necessary onto a single page and make it an effective agreement for you and your client?

For your sake, and that of your client, hire an experienced commercial real estate attorney to draft a great document that protects you and your clients, learn how to present it effectively to your prospective clients, and then go make incredible deals for them!

About Real Estate Strategies Corporation
Real Estate Strategies Corporation is a respected corporate advisory and transaction services firm that provides thought-leadership, decision-making, planning, project management, and transaction execution services to finance and senior executives at management team-led public, private, and portfolio companies, and not-for-profit organizations.  Under the leadership of its award-winning CEO, Andrew Zezas, RealStrat’s clients engage the firm when acquiring, disposing of, renegotiating, or enhancing occupied leased or owned real estate in New Jersey, Pennsylvania, New York, Connecticut, and throughout North America.  By creating and executing Business DRIVEN Real Estate Solutions and identifying hidden Opportunities, RealStrat drives greater operational and financial performance in support of its clients’ stakeholder objectives, M&A requirements, and exit strategies.

In the current economic environment, RealStrat’s efforts are focused on uncovering, capturing, and re-purposing hidden liquidity and minimizing risk in its clients’ leased and owned real estate.  The firm provides counsel as to competitive advantage strategies in preparation for the eventual economic recovery.  Visit www.RealStrat.com. Read about timely commercial real estate issues at RealStrat’s blog at www.CorporateAdvisor.wordpress.com. Follow RealStrat at http://www.Twitter.com/RealStrat.

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Copyright Real Estate Strategies Corporation 2011.  All Rights Reserved.

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THIS WORK IS DESIGNED TO PROVIDE PRACTICAL AND USEFUL INFORMATION ON THE SUBJECT MATTER COVERED AND REPRESENTS THE OPINION OF THE AUTHOR. HOWEVER, IT IS PROVIDED WITH THE UNDERSTANDING THAT THE AUTHOR IS NOT ENGAGED IN RENDERING LEGAL, FINANCIAL, ACCOUNTING, OR OTHER PROFESSIONAL ADVICE TO THE READER. IF LEGAL, FINANCIAL, ACCOUNTING, OR OTHER PROFESSIONAL ADVICE IS REQUIRED, THE SERVICES OF A COMPETENT PROFESSIONAL SHOULD BE SOUGHT. THE AUTHOR SPECIFICALLY AND EXPRESSLY DISCLAIMS ANY LIABILITY THAT MAY BE INCURRED AS A RESULT OF THE USE OR APPLICATION OF THE INFORMATION THAT IS CONTAINED IN THIS WORK.

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