Exclusive Buyer Agent

How to Choose Your Toronto Commercial Real Estate Exclusive Buyer Agent

Picking the right agent is one of those critical issues that can cost or save you thousands of dollars. There are very specific questions you should be asking to ensure that you get the best representation for your needs. Many agents would prefer that you don't ask these questions, because the knowledge you'll gain from their honest answers will give you a very good idea about what outcome you can expect from using this agent. And let's face it - in real estate, as in life - not all things are created equal.

Hiring a real estate agent is just like any hiring process - with you on the bosses side of the desk. It's critical that you make the right decision about who will handle what is probably the single largest financial investment you will ever make.

Do you really need an Exclusive Buyer Agent? Over 90% of tenants use an agent. Why? An agent can help you access the most Toronto office space commercial buildings possible using the Multiple Listing Services (MLS) and other sources of exclusive listing information that is only available to commercial Realtors. He or she can also guide you through the process.

However, not all brokers are equal. Your choice of broker can greatly influence: (a) the number of buildings you have to choose from; (b) the quality of information and guidance you receive; (c) the rent you pay; and (d) the quality of the office building you lease (e) the air quality and heating and cooling inyour office (f) whether or not you will be affected by clauses in your lease that can either help or hinder your business in the future

The types of agents are listed below.

Exclusive Buyer Agent - [100% for BUYERS].

Only a very few real estate brokers, are true, exclusive buyer's agencies. They work exclusively for tenants and never work for landlords. Why should this matter to you?

They help you find more office spaces because, having no buildings of their "own" to favor, they aggressively search all buildings listed with all other companies without bias. They aggressively research and negotiate 100% on your side so that you pay the lowest rent.

And, they give you honest advice that you can trust, because you know they are 100% on your side, 0% on the landlord's side. Less than one half of 1% of active agents qualify as true, Exclusive Buyer Agents.

Exclusive Seller's Agency - [0% for tenants].

This used to be the norm, where the entire firm would work only for landlords. They could claim they fought to get "top dollar" for their seller clients because, in fact, they never worked for tenants.

One of the major firms when I started in the business in Toronto worked this way and many of their agents are still around with the same mindset.

This type of strict, 100% seller agency is fading. It still exists whenever you call an agent directly who is advertising a building (the "listing" agent). All agents, when they act as "listing" agent, still work 100% for the landlord's interests, and many consumer advisors counsel you to never contact a listing agent directly.

Except when acting as a listing agent, most agents and companies have gone to a "mixed" agency format, described below. "Mixed Up" agency is a more apt description!

Traditional or Designated (Mixed) Agency - [50/50 "deal makers"]

Over the past few years most realty firms have gone to a "deal maker" mode. The firm and its agents claim to work as both seller's landlords and tenant's agents.

The problem is, however, that many times the firm and its agents will work as both buyer and seller agent at the same time!

This creates a "dual agency" where the firm and its agents have an obvious conflict of interest.

Who is protected when a conflict arises? The Tenantr? The Landlord? Or the Agents? Which client do they negotiate for, which against? What happens if there is a problem and you, as the tenant, want to cancel the deal but the landlord wants to hold you to it?

Does "your" dual agent assist you or the landlord? Generally you, as buyer, assume the greatest risk in a "dual agency" scenario. After all the landlord has many offices to lease out in his building all the time, but you can only rent one. The odds of such conflicts are great. Firms earn the highest commissions when they represent both parties and agents are often paid a bonus for selling such listings.

So, dual agency gives the least protection to both buyer and seller, yet agents are drawn toward it to maximize their back pocket.

The Consumer Federation of America and other consumer groups agree! It only makes sense to have 100% loyalty and representation!

For further differentiation between dual/designated representation and exclusive buyer representation, please note the advantages of working with an Exclusive Buyer Agent listed below.

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