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Denver Landlords Prefer to Work with Tenants Directly

Denver Commercial property landlords generate the majority of their income by collecting rent from tenants. They are overwhelmingly a collection of straight-forward business owners providing a valuable product to the business world.

In contrast, Denver commercial office tenants look for ways to keep occupancy costs low and their physical space as productive for business as possible. Thus, it's critical that tenants weigh every real estate decisions against their bottom line. In doing so, they should hire and maintain experienced tenant representation.

It stands to reason that most landlords would prefer to deal with tenants directly. It's just more compatible with profit goals. But such an arrangement, called a "direct deal," is rarely structured to favor the tenant.

It is critical that users of commercial office, retail or industrial space understand the wide array of Denver market conditions that could positively impact their real estate transaction, especially given current concession trends. Dealing directly with a single landlord would eliminate a number of valuable comparison properties throughout the market, as they would drive a tenant to properties only within their portfolio. Sublease options and purchasing scenarios also need to be given consideration in order to provide a tenant with a truly in-depth look at the market.

A landlord structuring a direct lease would often submit a lease that would be highly favorable to building ownership. Lease language related to audit rights, non-disturbance and attornment protection, escalation rates, renewal options and expense pass-throughs, for example, could be written to offer little tenant flexibility and or be dangerously absent all together.

Understanding a building's general operations are essential to a smart occupancy scenario as well but could be left unaddressed by a landlord who views them as "unnecessary details" of a lease. Freight elevator usage, add-on factors, common area guidelines and HVAC operating hours (critical to a tenant's monthly expenses) substantially impact how tenants integrate with their business space, financially and operationally.

Denver Landlords prefer to work with tenants directly because it simply benefits them more than it would if an exclusive tenant representative was in place to negotiate market-rate transactions and concessions.

The role of an exclusive tenant representative such as ProTenant isn't really about "protecting" tenants from landlords. It deals primarily with helping Denver commercial office tenants identify the myriad avenues for savings that are not conducive to a landlord's profit model. In short, working with a tenant representative from ProTenant is one of the best ways to minimize the costs associated with corporate office space.

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