LA Commercial Real Estate / Tenant Representation
Los Angeles · Tenant Representation
The commission is already in your deal.
The landlord’s listing agreement provides for a cooperating broker fee whether or not you bring your own broker. Going unrepresented does not save you that money — it hands the whole fee to the agent contractually working for the other side of your negotiation.
Get representedTenant representation is the most misunderstood service in commercial real estate, and the misunderstanding is expensive. Most business owners assume that hiring a broker adds a cost to their lease. In nearly every Los Angeles transaction, it does not. The fee exists in the deal before you arrive, it is paid by the landlord, and the only question is who receives it.
This page explains the economics honestly, including the parts that are uncomfortable for brokers. It also covers where representation genuinely does not add value, because a page that claims you always need a broker is not worth reading.
Who actually pays
The fee exists either way
When a landlord lists space, they sign a listing agreement with a brokerage. That agreement sets a total commission — typically 4–6% of aggregate base rent over the lease term — and it provides for a portion to be paid to a cooperating broker who brings a tenant.
In Southern California the splits vary by product type. Office deals commonly run 6% total, weighted toward the tenant’s broker at roughly 4% with 2% to the listing side. Retail and industrial more often split evenly, and industrial deals tend to total 5% rather than 6%.
Here is what actually happens to that money in each scenario.
Where the Commission Goes
Without your own broker
You negotiate alone
The landlord pays exactly the same amount. You saved nothing. The agent collecting the full fee has a fiduciary duty to the landlord, and you are negotiating against their client using their comparables.
With a tenant rep
You have your own advocate
The landlord pays exactly the same amount. Your cost is still zero. The difference is that someone with a fiduciary duty to you is running the comparables, the process, and the negotiation.
Percentages shown are a typical LA office structure and are illustrative. Actual commission rates, splits and payment schedules vary by property type, landlord, deal size and market, and are set in the listing agreement between the landlord and their broker. Industrial and retail commonly split evenly rather than 4/2, and industrial deals often total 5%. Ask any broker to explain the fee arrangement on your specific deal — a good one will tell you without being asked.
The one exception worth knowing
A small number of landlords — usually single-asset owners self-listing without a brokerage — will refuse to pay a cooperating fee, or will offer a reduced one. This is uncommon in institutional LA product but does happen on smaller buildings. A reputable tenant rep will tell you at the outset if a specific building falls into that category and how it would be handled, rather than discovering it at the LOI stage. Ask the question early.
The dual agency problem
Legal in California, and worth understanding
Dual agency is when one brokerage — sometimes one agent — represents both the landlord and the tenant in the same transaction. It is common in commercial real estate and it remains legal in California.
In 2017, Assembly Bill 1059 proposed prohibiting brokerage firms and their licensees from acting as dual agents in commercial transactions. It faced strong opposition from industry associations, was held in the Judiciary Committee, and did not become law. So the practice continues.
What did change: since January 1, 2015, the written agency disclosure requirements that had applied to residential transactions for three decades were extended to commercial real property, including leases with terms exceeding one year. Your agent must disclose in writing whether they represent you exclusively, the landlord exclusively, or both.
The practical issue is not that dual agency is sinister. It is that a dual agent cannot advocate. An agent representing both sides cannot advise you to push harder on free rent while simultaneously advising the landlord to concede less. The duty of undivided loyalty that makes representation valuable is precisely what dual agency removes.
Three questions to ask any broker before you engage
1. Do you or your firm currently represent landlords in the submarkets I am considering? 2. If we tour a building your firm lists, how will that be handled — and will you tell me before we tour it, or after? 3. Will you put your agency status in writing at the start, not at the LOI?
None of these questions are hostile. Any broker who reacts as though they are has answered them.
What a tenant rep actually does
Beyond sending you listings
The listing-forwarding version of this job is not worth a fee to anyone. Here is the work that is.
Builds the full option set, including what is not listed. Public portals show a fraction of available space. A meaningful share of LA availability circulates through broker relationships before it is marketed, and some of the best options are spaces where a landlord would entertain a deal but has not formally listed. Your option set determines your leverage more than your negotiating skill does.
Runs a competitive process. The single biggest driver of lease economics is whether the landlord believes you have alternatives. A structured request for proposals across several buildings produces genuinely competing offers. One tenant touring alone produces one offer.
Supplies comparables you cannot access. Asking rates are public. Effective rates — what deals actually closed at after free rent, improvement allowances and escalation structure — are not. That gap is currently 15–25% on LA office deals. Without closed comparables you are negotiating against a number the landlord chose to publish.
Converts every proposal to one comparable number. Full-service against triple net, different load factors, different concession structures, different escalations. Ranking proposals requires reducing each to an effective rate over the term.
Negotiates the terms that are not the rate. Free rent treatment, improvement allowance scope, base year and gross-up, expense caps and exclusions, audit rights, renewal and expansion options, assignment standards, restoration waivers, relocation limits, SNDA. These move the deal more than base rent and most tenants never raise them.
Manages the critical path. LOI, lease legal review, space planning, permitting, construction and occupancy each have lead times, and LADBS is the least predictable item on the chart. Coordination failure here costs rent.
The detailEvery one of those terms, explained — our leasing guideWhat representation is worth
Model it on your own deal
Representation is worth the difference between the deal you would have signed and the deal you sign. That is not measurable in advance, but it is estimable — and the honest way to present it is to let you set the assumptions yourself rather than quote a number we chose.
Representation Value Estimator
These are your assumptions, not our promises. No broker can guarantee a specific outcome, and the achievable improvement depends entirely on the submarket, the landlord, your credit and your timeline. The defaults above are deliberately modest — a 5% rate reduction and two extra months of abatement are unremarkable outcomes in the current LA office market, not aggressive ones. Set them to zero and the tool still shows a cost of nothing.
The process
What working together looks like
Engagement Timeline
Engage at week zero, not week thirty. The leverage in a commercial lease comes from having real alternatives, and alternatives take time to develop. A tenant with nine months has competing proposals. A tenant with ninety days has one option: accept what the landlord offers. Everything else on this page depends on starting early.
What we need from you
An honest headcount projection, a budget range you can actually live with, your genuine constraints as opposed to your preferences, and your lease expiry date. The most common way a search goes wrong is a requirement that changes at month four because it was never properly defined at month one.
Renewals: where representation matters most
And where it is used least
Most tenants who use a broker to find space renew without one. That is backwards.
Replacing a tenant costs a landlord considerably more than retaining one — new improvement allowance, leasing commissions, downtime and marketing. That asymmetry is leverage, and it exists whether or not you intend to move. But it only converts into better terms if the landlord believes you might leave.
A tenant who has not toured alternatives has no comparables and no credible alternative, and landlords can tell. The renewal proposal reflects that.
Three things worth doing on any renewal:
Test the market anyway. Run a genuine search even if you strongly expect to stay. It costs touring time and produces the comparable data that prices your renewal.
Right-size. Your footprint was sized for a headcount and working pattern that may no longer apply. Many LA tenants are renewing into less square footage at a higher rate and paying less in total.
Ask for concessions anyway. Renewals rarely come with meaningful improvement allowance or free rent unless requested. The landlord is still avoiding a vacancy. Ask for a refresh allowance and abatement.
If you are mid-term and the market has moved, raise a blend and extend — a reduced current rate in exchange for extending the term. This is common in LA office right now and worth raising even when expiry is years away.
Choosing a tenant rep
Including questions we would rather you asked
Commercial brokerage in Los Angeles is submarket-specific and product-specific in a way that is easy to underestimate. A broker who does South Bay industrial and one who does Westside creative office are in different businesses using the same job title.
Broker Vetting Checklist
Use this on us too. If a broker cannot answer the conflict questions directly, or gets defensive about the fee questions, that is the answer. Interview at least two.
On representation agreements
Most tenant reps will ask you to sign an exclusive representation agreement. That is reasonable — the work is front-loaded and unpaid until a deal closes. But read it:
Term. Six to twelve months is normal. Multi-year exclusives on a single requirement are not.
Geographic and product scope. Should match your actual search, not the entire county.
The tail. A clause entitling the broker to a fee if you lease a property they introduced you to, for some period after the agreement ends. Standard and fair — but it should be limited to properties on a written registration list, not every building in Los Angeles.
Termination. There should be a way out with reasonable notice if the relationship is not working.
What happens if the landlord pays no fee. Some agreements make the tenant liable for the difference. Know this before you sign, not when the invoice arrives.
When you don’t need a tenant rep
The honest section
Representation is not always the right answer, and a page that pretended otherwise would not deserve your trust.
Very small or short requirements. A 600 SF suite on a one-year term generates a commission too small to fund real work. You may struggle to find a broker who will engage properly, and a half-engaged broker is worse than none. Executive suites and coworking are usually better solved directly.
You already know the building and the landlord. If you have a long relationship with an owner, have transacted with them before, and are renewing on terms you have independently benchmarked, a broker may add process without adding leverage.
Truly commoditised space in a landlord’s market. Where vacancy is near zero and the product is interchangeable, there is little to negotiate. Note that this describes very few LA submarkets right now — but it does describe some tight industrial pockets.
You have in-house real estate capability. Larger companies with a real estate function may only need market data and local execution rather than full representation.
Outside those situations, the arithmetic is hard to argue with: the fee is being paid regardless, and the only question is whether it buys you an advocate.
Before you searchEvery LA submarket, with the data Back to the hubLos Angeles commercial real estate: 2026 market guideFrequently asked questions
Does a tenant representative cost me anything?
In nearly all Los Angeles commercial leasing, nothing out of pocket. The landlord’s listing agreement provides for a cooperating broker commission, so the fee exists in the deal whether or not you are represented. Declining representation does not reduce it — it consolidates the entire fee with the landlord’s agent.
The exception is a landlord who refuses to pay a cooperating fee, which happens occasionally on smaller self-listed buildings. A good broker will identify that at the outset and explain how it would be handled.
How much is the commission on a commercial lease?
Typically 4–6% of aggregate base rent over the lease term, paid by the landlord. In Southern California, office deals commonly run 6% total weighted toward the tenant’s broker at around 4% with 2% to the listing side. Retail and industrial more often split evenly, and industrial deals tend to total 5%.
Payment is commonly staged — often half on lease execution and half on occupancy. Rates and splits are negotiable and set in the listing agreement between landlord and listing brokerage.
Can’t I just work with the listing agent directly?
You can, and it will not save you money — the landlord pays the same total commission either way. What changes is representation. The listing agent has a fiduciary duty to the landlord. They are not obliged to tell you the landlord would accept less, that a comparable building down the street is offering three more months of free rent, or that the escalation structure is above market.
If a single agent or firm represents both sides, that is dual agency. It remains legal in California but must be disclosed in writing, and a dual agent cannot advocate for either party against the other.
Is dual agency legal in California commercial real estate?
Yes. Assembly Bill 1059, introduced in 2017, would have prohibited brokerage firms and their licensees from acting as dual agents in commercial transactions. It met significant industry opposition, was held in the Judiciary Committee and did not become law.
Since January 1, 2015, written agency disclosure requirements that previously applied only to residential transactions were extended to commercial real property, including leases exceeding one year. Your agent must disclose in writing whether they represent you, the landlord, or both. Ask for that disclosure at the beginning of the relationship rather than at the letter of intent.
When should I engage a tenant rep?
Nine to twelve months before your lease expires if your requirement needs build-out, six months for move-in-ready space. Earlier is better and rarely wasted.
The constraint in Los Angeles is permitting — LADBS plan check runs 4 to 12 weeks and most commercial projects go through one to three correction cycles at 2 to 6 weeks each. But the bigger reason to start early is leverage: a tenant with alternatives negotiates from a different position than one facing expiry.
Do I need a broker for a lease renewal?
Renewals are arguably where representation matters most, and where it is used least. Replacing a tenant costs a landlord far more than retaining one — new improvement allowance, commissions, downtime and marketing. That asymmetry is your leverage, but it only converts into better terms if the landlord believes you have alternatives.
A tenant who has not toured the market has no comparables and no credible alternative. Landlords can tell, and the renewal proposal reflects it.
What if I’ve already toured buildings on my own?
Tell any broker you interview exactly which buildings you have visited and who showed them to you, before you sign anything. Landlords typically register a prospective tenant to whoever introduced them, and a broker generally cannot claim a fee on a building where another agent has already registered you.
This is not usually a problem — it just needs disclosing early so the representation agreement can carve out those properties. Discovering it at the LOI stage creates a genuine dispute.
What should I look for when choosing a tenant rep in LA?
Recent transactions in your submarket and product type, at your size band — ask for the last three, including where and how large. Whether they or their firm also represent landlords in the submarkets you are considering, and how conflicts get handled. Written agency disclosure at the start. A clear explanation of how they are paid.
Also ask who will actually do the work. On some teams the person in the pitch is not the person who runs the search.
What is in a tenant representation agreement?
An exclusive representation agreement typically covers term, geographic and product scope, the broker’s duties, how compensation works, and a tail provision entitling the broker to a fee if you lease a registered property for some period after the agreement ends.
Check four things: the term is six to twelve months rather than multi-year, the scope matches your actual search, the tail is limited to a written registration list rather than every building in the county, and you understand what happens if a landlord declines to pay a cooperating fee.
Can a tenant rep help me buy a building instead?
Yes, and it is worth modeling both. For an owner-user with a stable long-term space requirement, SBA 504 financing at roughly 10% down can make ownership more attainable than most business owners assume. The trade is that the down payment is capital removed from your operating business.
Buyer representation works similarly to tenant representation — the seller typically pays the commission from sale proceeds. Our buying guide covers the underwriting, the Proposition 13 tax reset and Measure ULA.
What does a tenant rep actually do that I couldn’t do myself?
Three things primarily. Access to availability that is not publicly marketed, including space where a landlord would transact but has not listed. Closed comparable transactions showing effective rather than asking rents — a gap currently running 15–25% on LA office deals. And a structured competitive process across multiple buildings, which is what actually moves landlord behavior.
Beyond that: converting proposals with different structures into one comparable number, and negotiating the terms that are not the rate — base year and gross-up, expense caps and exclusions, options, assignment standards, restoration waivers and SNDA.
Are there situations where I shouldn’t use a tenant rep?
Yes. Very small or very short requirements generate a fee too small to fund proper work, and a half-engaged broker is worse than none — executive suites and coworking are usually better handled directly. If you have a long-standing relationship with a landlord and are renewing on independently benchmarked terms, a broker may add process without leverage. And larger companies with in-house real estate capability may need market data and local execution rather than full representation.
Outside those cases, the fee is being paid regardless, so the question is only whether it buys you an advocate.
Tenant Representation
Negotiating the best lease doesn’t start and end with the best rate.
Term, tenant improvement dollars and free rent are just a few of the things we can help with. Tell us your requirement, your submarket and your expiry date — and in nearly every LA deal, our fee comes from the landlord’s listing agreement, not from you.