6 Tips for Qualifying a Tenant in Commercial Real Estate Agency

commercial real estate boardroom presentation
Qualify your tenants thoroughly first in commercial real estate.

In commercial real estate agency the tenants that you talk to must be qualified before you spend a lot of time with them.  Most tenants looking for new or alternative premises to occupy will have spoken to quite a number of local property agents; on that basis you are just another person to get information from.  Asking the right questions will help you work with the right tenants in the right way.

Most towns and cities will have a good supply of vacant premises available.  We have some good listing stock to work with.  If you want to dominate the local leasing market for your property type, it is wise to focus on the best property locations and the quality properties.  In that way you will move more listings and do so faster.

 

Here are ten questions to ask prospective tenants before you get deeply involved in matching listings and undertaking property inspections:

  1. Find out just who you are talking with and determine that they are the principal decision maker that is looking for property to lease.  This issue gets more complex when you are dealing with a company or corporation.  You may be talking with the local business manager but they may have little decision facility.
  2. Understand their property requirements in location, improvements, car parking, area of premises, permitted use, and rental budget.  These simple facts will help you with creating a short list of premises to look at.
  3. The services and amenities in a property may be of relevance given the way the business or tenant operates.  Staff and customer numbers will place some pressures on property choice.
  4. A lease can be negotiated on the basis of gross or net rent.  Through direct questioning you can see what rent types could suit the tenant.  That will then influence the choice of property, the lease negotiation and the initial term of the lease in years and or months.
  5. Ask them about any contacts they may have made with other agents.  If your market is dominated by open listings it is likely that the tenant has looked at a lot of your listing stock already; on that basis you can see your commission from a lease agreement ‘disappear’ due to another agents introduction to the same property earlier.
  6. The ideal timing of property changeover will give you an idea of just how important the move of premises is to them.

When you have got these facts sorted and identified you can move to the next stage of property selection and inspection.  A wise leasing agent will get all the leasing the facts on the table and clearly identified before the hard work starts in property identification.

Author: John Highman

Commercial Real Estate Broker, Coach, Speaker, Author, Broadcaster.