Commercial Property Herald

We Are Moving to CRE Radio

As many of you may know, I am a principal and the host of CRE Radio, a radio show dedicated to topics involving commercial real estate. We have just expanded CRE Radio to include my blog posts that I have been posting here on The Commercial Propert Herald.

For the next few months, we will be posting on both sites, but will eventually shift my blog posts to CRE Radio, exclusively.

I encourage you to go to www.creradio.com to read our blog posts and explore our radio shows and videos.

Howard

Getting Down and Dirty With Green

I am pleased to announce that we have opened our blog to a select group of guest bloggers.  Michael Gottlieb,, the Managing Partner of Advanced Green Solutions will be writing a guest blog for CRE Radio on Environmental and Green Buildings.  For more information, please click on Advanced Green Solutions.

Do you want to test a green building to see if it is truly operating in a sustainable manner? Then, go to the bathroom.

I don’t mean this in the same way I do prior to taking my 6-year-old on a long car trip. Bathrooms are a great place to see how sustainable policies, investments and practices come together and the answers you find on a quick inspection may not be pretty in more ways than one. With flu season upon us, now is the perfect time to assess the relative health of buildings and the risk they pose to you becoming one of the between 5 percent and 20 percent of the U.S. population that the Centers for Disease Control and Prevention says will contract seasonal influenza. That estimated loss of 70 million work days will contribute to more than $10 billion in lost productivity. 

“Restrooms are often the Achilles’ heel of sustainability,” said Joshua Radoff, co-founder and principal of the sustainability consulting firm YR&G, during a GreenBiz webinar.

And, according to a survey by Staples, bathrooms may not be the dirtiest place in an office building. Nearly one-third of respondents said their keyboard and phone are the dirtiest thing in their office.

“There are also growing concerns about human health around the world and the prevention of dis­ease transfer and disease epidemics,” concludes the IFMA Foundation’s Global Green Cleaning Sustainability Guide. “However, the use of a comprehensive approach to green and sustainable cleaning, while monitoring the cause and effect in all ancillary actions, can have a measurable impact on reducing environmental impacts in an economic and socially beneficial manner.”

 

Take the Green Building Smell Test

What you see, hear and smell in a restroom will tell you whether a property owner is truly committed to sustainability or whether it is all just greenwashing.

Going green is not just about protecting the environment, but to provide a healthier environment for people in buildings. The big promise of going green – that workers will be healthier and more productive – hinges on the practices that converge in the bathroom and reflect the general commitment by a property owner to meet the expectations that the LEED plaque in the lobby proclaims.

When you entered the bathroom what did you see? Did a sensor turn on the lights when you entered? Do you hear a fan rattling away? Does it look dirty or did you pick up any strong chemical smells that make you feel a little green? If the answer is yes to either one, then maintenance could be an issue.

What kind of toilets is installed? Low-flow toilets are good, but in states like California, which has mandated low-flow toilets since 1992, you should look for clearly marked dual-flush toilets. Without instructions high-efficiency appliances can end up wasting more water and energy than they save.

For the men out there, stop by the urinal. Waterless urinals are great, but they require regular servicing. If you catch a strong whiff of ammonia, deferred maintenance might be an issue limiting the effectiveness of the devices.

Are the sinks sensor activated and when triggered was there enough water to properly wash or far too much? If you used paper to dry your hands, was the paper recycled and did you need to use more towels than usual? Of if a hand dryer is provided, how long did it take you to get your hands completely dry? Systems need to be calibrated correctly to provide the maximum efficiency. Too much water, paper or dryer time is wasteful. If you can’t wash and dry your hands properly the hygiene of a building comes into question.  Keep in mind that wet hands are more than 500 times likely than dry hands to transfer germs the next time you press the button to call the elevator.

If you find that the bathroom fails the smell test, then chances are that other building systems are not functioning effectively and providing the sustainable benefits you expect in a green building.

 Michael Gottlieb

 

It's a Wonderful Life or Henry Potter Losses Election

Why, when I finally get a great acting part, everything gets more confusing?

As some of you may know, my spare time, I do some stage acting.  This is not a money thing.  I just do it for giggles, but I really do enjoy it.  It's not like I have any spare time, with the radio show and law practice, but I find the mental exercise necessary to learn and perform a part, live on stage, to be extremely enjoyable and great for my focus in all other aspects of my life.

I recently auditioned for and was awarded the part of Henry Potter, the mean, villainous banker in It's a Wonderful Life, The Musical. Better yet, my 16 year old daughter, Lauren also received a part as a soprano in the ensemble and my "goon, who pushes me around stage in my wheel chair.  Now her part is the most demanding since she has to push a big, heavy grouchy old man around stage on a 30's style, wooden wheel chair.

This is the "It's a Wonderful Life," same as the movie with Jimmy Stewart that we see on TV every holiday season, except with some great music. It’s hard to imagine, but it works.

So here I am, reviewing the entire script and I have an overwhelming sense of déjà vu. What struck me about the script and my part was the scary similarities between the story, my character and our economy for the last 10 years of so. Image, it’s the 1930's. Here I am, Henry Potter, old, crotchety man, a banker who criticizes George Baily and his father, who own a small building and loan, for lending money to people who otherwise could not afford their own homes. One of my lines is, "All you have to do is shoot pool with an employee around here and you can come in and borrow money." Fast forward to 2005, you don’t even have to shoot pool to borrow money; all you have to do is fog a mirror to borrow money.  Sound familiar?

In It’s a Wonderful Life, one of the messages of the story is that it is important to give people a chance to better themselves.  The Baily Building & Loan is praised, for loaning money to people who couldn't afford to pay it back and the banker is criticized for being greedy and thinking too much about profit.  In real life, we now criticize the small banks and lenders for loaning money to people who couldn't afford to pay the money back and we have encouraged large banks to take over the smaller banks.

Today, George Baily would be sued and thrown in jail and the Henry Potters of this world would be elevated to the head of Wells Fargo or Chase Bank.  So what is it?  Am I playing a good guy or a bad guy? Oh, I am so confused.  Actually, I am not.  I can go write a dissertation about the differences in the  story to real life, but to see how I play the part, you have got to come see me.

If you are in the area, (Southern California), and want to see a highly entertaining musical and see me at my best/worst, oh whatever, call 949.489.8082 or go to the website at www.caminorealplayhouse.org and let them know that you're coming to see Howard and Lauren Kline.  My daughter can make a small, extra spiff and we will use the money to help her offset the cost of her choir trip to New York where she will be singing in Carnegie Hall.

 

It's a Wonderful Life or Henry Potter Losses Election

Why, when I finally get a great acting part, everything gets more confusing?

As some of you may know, in my spare time, I do some stage acting.  This is not a money thing.  I just do it for giggles, but I really do enjoy it.  It's not like I have any spare time, with the radio show and law practice, but I find the mental exercise necessary to learn and perform a part, live on stage, to be extremely enjoyable and great for my focus in all other aspects of my life.

I recently auditioned for and was awarded the part of Henry Potter, the mean, villainous banker in It's a Wonderful Life, The Musical. Better yet, my 16 year old daughter, Lauren also received a part as a soprano in the ensemble and my "goon, who pushes me around stage in my wheel chair.  Now her part is the most demanding since she has to push a big, heavy grouchy old man around stage on a 30's style, wooden wheel chair.

This is the "It's a Wonderful Life," same as the movie with Jimmy Stewart that we see on TV every holiday season, except with some great music. It’s hard to imagine, but it works.

So here I am, reviewing the entire script and I have an overwhelming sense of déjà vu. What struck me about the script and my part was the scary similarities between the story, my character and our economy for the last 10 years of so. Image, it’s the 1930's. Here I am, Henry Potter, old, crotchety man, a banker who criticizes George Baily and his father, who own a small building and loan, for lending money to people who otherwise could not afford their own homes. One of my lines is, "All you have to do is shoot pool with an employee around here and you can come in and borrow money." Fast forward to 2005, you don’t even have to shoot pool to borrow money; all you have to do is fog a mirror to borrow money.  Sound familiar?

In It’s a Wonderful Life, one of the messages of the story is that it is important to give people a chance to better themselves.  The Baily Building & Loan is praised, for loaning money to people who couldn't afford to pay it back and the banker is criticized for being greedy and thinking too much about profit.  In real life, we now criticize the small banks and lenders for loaning money to people who couldn't afford to pay the money back and we have encouraged large banks to take over the smaller banks.

Today, George Baily would be sued and thrown in jail and the Henry Potters of this world would be elevated to the head of Wells Fargo or Chase Bank.  So what is it?  Am I playing a good guy or a bad guy? Oh, I am so confused.  Actually, I am not.  I can go write a dissertation about the differences in the  story to real life, but to see how I play the part, you have got to come see me.

If you are in the area, (Southern California), and want to see a highly entertaining musical and see me at my best/worst, oh whatever, call 949.489.8082 or go to the website at www.caminorealplayhouse.org and let them know that you're coming to see Howard and Lauren Kline.  My daughter can make a small, extra spiff and we will use the money to help her offset the cost of her choir trip to New York where she will be singing in Carnegie Hall.

 

Microsoft Surface: An Alternative to the iPad for CRE professionals

Microsoft has now splashed out with its new operating system and a new tablet device, purportedly intended to challenge the iPad's dominance and overwhelming success.  This is my initial review and experience with the Microsoft "Surface", their mobile tablet device.  While I have played around a bit also with the new Windows 8, this review will be limited to the Surface.

Let me start by explaining, if you don't already know it, I am a bit of a gadget freak.  My entertainment is often trying out new software and devices to see if I can make them work better for my uses than my current or immediately former devices.  I am what the experts call, "a first adopter".  When Microsoft first came out with their original tablet software, using a digitizing pen, I got my Toshiba tablet before nearly anyone else and was the only one that I saw walking through Comdex with a tablet. To be frank, I was showing it off, but my arms started to hurt after a while because of the heft of the device.  Although I continued to use these predecessor tablets, because of their great ability to write on the device as if it were searchable paper, they were never widely adopted by the public.  Understand, these were very different devices from the current crop of iPad and iPad like devices which are instant on and light as a wisp.

But I digress.  For the last 5 years or so, although I continue to use some windows computers, I predominantly use Macs due to their elegant operating system, ease of use and sturdiness.  If they crash more than twice a year, that is an event as compared to my windows computers that I hope do not crash twice a week.

So yesterday I go into the Microsoft Store, the second time in a week, now convinced I am going to purchase a new tablet.  I had been in the store a week before and tried it out.  Super fast and responsive, brilliant screen and easy operating system using a touch screen.  What was there not to like?  True, I had some concerns about the lack of applications that can be used with this version, (RT) of the Windows operating system, but come on, it was new and shiny.

I actually bought it, giving my credit card to the salesman who processed the purchase on a portable Windows 7 computer, (they didn't even use their own tablet and no it wasn't an iPad).  Nice kid and even offered to set it up for me.  Now, I usually turn down such an offer, preferring to set things up myself while discovering what I could do with it, but this time, I took him up on his offer.

To make a long story short, after an hour, the salesman and two "experts" couldn't seem to get my shiny new tablet to work properly and offered to exchange it for me for a also, brand new tablet.  No thanks.  Look, if the seller can't get the damn thing to work properly before I leave, what's the likelihood that I am not going to want to throw it out the window before I even get home?  The interesting thing is that the experts had never seen this problem before, which led me to the reasonable conclusion that the problem was probably limited to this device and perhaps a corrupted software file.  But still, it sure seemed like a typical Microsoft PC experience, which led me to some additional observations about the Surface and my buying experience:

• A Microsoft Store ain't no Apple Store.  The Microsoft employees are primarily temps with little enthusiasm and experience, particularly with their new operating system and devices. Their, so-called, "experts" were pure amateurs as compared to the marvelous zealots who work at the Apple Store.
• Assuming that the Surface does work as intended, it is different from the iPad and Android devices.  Probably the key difference to me is that the Surface is more of a PC in a touch tablet form.  In many ways, that it a good thing.  Drafting documents in Word on my iPad is a daunting task, while drafting documents with the clip on keyboard on the Surface, in Word, is a wonderful experience.  If you are a writer who is looking for a tablet to take with you to draft letters, articles, blog posts or anything else using Microsoft Word, I highly recommend the Surface rather than lugging a notebook computer wherever you go.  In this respect, the Surface can replace a notebook computer.  But this is also where the surface fails.  It is a much more PC like experience, whereas the iPad is light, quick and easy and is really not intended to replace a laptop computer. Matt Baxter-Reynolds has written a really good article in ZDNet.(click here for the article), further explaining the strengths and weaknesses of the Surface.
• There are very few applications currently available for use on the Surface.  This version of the Surface uses a special "light" version of Windows 8 and you can't use your regular Windows programs or Windows Phone apps on it.  I do understand that there will be another Surface tablet available in a few months that will have the full version of Window 8 on it and you can currently get convertible notebooks with an active digitizer stylus from other manufacturers.  More on that later.

So what does all of this have to do with using the Surface for commercial real estate professionals?  Well, if you have been using an iPhone, iPad or an Android device using any commercial real estate specific applications, and there are a world of them out there that are very useful, don't even think about getting the Microsoft Surface with Windows RT.  If you make it out of the store, you will throw it out the window before you get home.

Next week, I will be writing about my experience with Windows 8 on a PC as well as the new Windows Phone 8 on the new Nokia 920 when it comes out this Friday.

 

 

Windows 8 Pop-Ups

As Microsoft readies for its public release of Windows 8, they are releasing their preparing for a "brick and mortar style onslaught, so to speak.  They are planning 34 temporary pop-up stores in malls and other retail centers.  According to Mary Jo Foley, writing for ZDNET, it appears that these pop-ups will be much less brick & mortar and a little more like mall kiosks. To read Mary Jo's article and a view of the what these pop-ups will likley look like, go to her article by clicking on her name above.

My guess is that the pop-ups are more for marketing purposes and, perhaps, sales and distribution of Microsoft's new Surface Tablet featuring Windows RT.  I suspect that they will likely stay up so long as demand requires.

Look for my review of the Mircrosoft "cloud" Office 365, touted for small business, later this month and the Nokia 920 Windows 8 phone in November.

Green Building Opus #1

Last week, the Los Angeles Times published an article about a home builder’s efforts to construct “green” homes that produce as much energy as they consume.  This seemed like a great idea, appealing to my sense of social consciousness and innovation, but leaving serious questions in my mind about the economics of going green.  For quite some time, I have been mildly interested in concepts of energy conservation, particularly as it is applied to commercial real estate.  I have finally decided to “take the bull by the horns” and write about all that I know about Green Buildings.  Sure, I have heard about LEEDS certification, recycling waste, wind turbines and solar cells, but what about practical economics and concepts such as “carbon footprint”? Doesn’t there have to be some consideration for the cost of going green?

With my interest heightened, I decided to write an Opus on the subject. How odd to use the term opus, but it seemed most fitting under the circumstances. An Opus is a “creative work,” a greater “whole,” if you will, comprised of individual pieces, numbered to designate the order of the composition.  The term is often used to describe larger works of music that are comprised of individual movements, when put together in an organized fashion become a masterpiece.  I think of Isaac Asimov’s Foundation Trilogy to be an Opus. Each chapter being separately written as short stories and published in newspapers and then combined into books that later became a trilogy. Actually, Asimov continued the “Foundation” story with many more books, well beyond the initial trilogy, the total sum of which should be considered an opus.  It’s another way of making the “whole, greater than the sum of its parts”.

 Why an Opus, you ask? Well, if the truth be told, I do not feel knowledgeable enough to be qualified to write on the subject at this time. But, I do intend to learn through research and interviews and discuss what I have learned, as I learn it, in articles, columns and on CRE Radio. What better way to teach than to do so while you learn. What better way to learn than to teach? This may require a little explanation.

 One of my best teaching experiences was when my son asked me to help him with Algebra. A cold chill ran up my spine. I looked at him, wondering what he would think of me when I told him that I studied algebra with an abacus.  This was not fair.  I thought I had escaped algebra with a “C”. Sheepishly hiding my ignorance, (I didn’t want to blow his admiration of me as the “all knowing Oz” of the family), I sat down with him and suggested that we review the chapter together and “learn it as we go”. Feeling like I was back in grade school, we spent the next 2 ½ hours, reviewing the entire chapter and working on the problems. Both bleary eyed, we called it a night at 10:30 pm.  It was an incredibly effective, father and son experience. One in which I think I learned as much as he did. I realized that what I was teaching to him was not Algebra, but how to learn. In retrospect, that was a far better lesson to teach. By the way, as it turns out, I really remembered far more than I thought and it seemed much easier than it did 50 years earlier.

 The content of the opus will include a combination of technology, economics, financial feasibility, opinions and social responsibility.  What and when I write will depend upon what and when I learn it.  I intend to take a “green” journey and take my audience with me as an interactive passenger.  Learn as I learn and participate in the discussion. 

 While I can’t give you details yet on each stop that we make along the way, I can give you a general direction of where I am going.  I don’t want to just learn about energy savings or alternatives.  My goal is to learn and report on green building initiatives that make economic sense, such as how a shopping center owner can convert the center to a “green” center and save money, in addition to being a good social citizen.  While I appreciate the value and responsibility of being a good citizen, I do not think that green buildings will gain widespread acceptance until they make economic sense.

 I intend to ask the hard questions with a healthy amount of cynicism regarding a property owners use of the phrase, “Green Buildings.”  Are building owners using the term “green” merely as a marketing ploy or are their buildings, truly “green” as the term implies.  As an example, last week, it was reported that The Total Tour building in Berlin was recently completed and turned over to the tenant, the Total Oil Company.  The building was touted as a “green building,” with 90 spaces for bicycles, 240 parking spaces for cars and conveniently located opposite the main railway station.  I am not suggesting that this building is not a “green building,” but it would be nice to know what else went into it being a “green building,” other than 90 bicycle spaces and being opposite the main railway station.  These are the questions that I intend to ask and answer as part of the opus.

This Opus will include at least two Green Building shows on CRE Radio, numerous blog posts on my website, www.creradio.com and video specials.  Ideas and contributions are encouraged and you can email me at howard@creradio.com.

Finally, for those of you who might be curious, my son no longer thinks of me as the “all knowing Oz”.  He is a teenager now, of course.

Do Your Elected Officials Support Commercial Real Estate?

When I started writing this blog and producing CRE Radio, I swore that I would stay away from political issues.  Well I have already breached my promise when I wrote about taxation of Internet sales and now I am about to do it again.  No, relax; I am not going to be giving my opinion on who to vote for or what issues I consider to be important. 

What I do want to stress is how important it is to get involved in issues that are important to your commercial real property business.   For the purpose of this blog post and in the interest of brevity, I would like to focus on your minimum involvement in economic and political issues that effect commercial real estate and your livelihood. I understand that there may be numerous other issues that are of interest to you, but that is grist for another mill.

To get to the heart of the matter, at the very least, you need to educate yourself on; (i) what the issues are; (ii) which legislators support or oppose the issues and why; and (iii) VOTE!

The first step is to be educated.  I know, it is not that easy with all of the time that you have to spend just trying to earn a living and doing your job.  But some of these issues may make your life much easier or harder.  I don't know about you, but I just don't have the time to stay on top of all of the issues and things that my legislators are doing and I don’t feel comfortable relying solely on the press to give me the straight scoop.  That's why I highly recommend that you belong to an organization that does the research for you.  Most commercial real estate organizations keep track of all of this information for you, including IREM, BOMA, ICSC, etc.  You don't have to agree with any of the organizations point of view or recommendations, but you should pay attention to what they are saying and what information they are delivering.

It was recently brought to my attention that the local Orange County, (California) chapter of Irem is having a, “Meet the Candidates,” lunch on Friday, September 21, 2012 at the Hyatt Regency in Irvine.  If you are in the area, I highly recommend that you go to this luncheon.  They are having 8-10 candidates and it is being moderated by Rex Hime, president of the California Business Properties Association. The way that Rex is planning on conducting this event, he will ask 2-3 questions on issues of extreme importance to professionals involved in commercial real estate, including Split Roll Property Taxation. To hear Rex explain this event, click here Rex Hime - Meet the Candidates 2.

If I may, I would also like to take this opportunity to mention Rex and the California Business Properties Association as well as similar lobbying organizations throughout the United States. Remember, the first point was to be educated.

Until a few months ago, when I was fortunate enough to be invited to a 2-day conference in Sacramento hosted by the California Business Properties Association, I perceived a lobbyist as a hired gun to be your spokesperson representing your interests.  During the conference, I realized that appearances can be very deceiving and a huge amount of the time spent by Rex and his staff was to pay attention to and sift through the thousands of bills proposed each year and bring to the attention of business property owners, those bills that explicitly or often, implicitly affect commercial real estate.  Oh my gosh, what a huge job.  Rex and his staff have to read each bill to make sure that there is nothing hidden in them.  If it were not for Rex’s taste in Hawaiian shirts, he would have moved way up in my esteem.

The point of this post is not necessarily to promote this luncheon, although I do think that it is a good idea.  There have got to be similar luncheons, breakfasts and dinners happening all over the United States, which you should and could attend.  Know the issues, know your candidates. Don’t ignore these great opportunities to support yourself, become educated and vote for the candidate that best represents your interests.

 

Can An Attorney Actually Collect Past Due Rents from Commercial Tenants?

You bet they can, or, at least I can and do. OK, so this may be a little bit of shameless self-promotion, but I get tired of hearing from landlords:

“Why bother trying to collect if we are not going to get paid.”

Drum roll please:

In the last three months, I have settled three separate cases in which my client’s have sued both existing and former tenants for an aggregate amount of $335,000.00; that’s no mere chump change. One stipulation was for $80,000.00; the other for $110,000 and the first was for $145,000.00, plus continuing rents on the lease. The best part of these settlements was that the actual rents owed on all three leases was around $265,000 and we obtained all of our client’s attorney’s fees.

Now, I am not suggesting that we will always be successful, but these three collection suits are perfect examples of what can be accomplished if you carefully evaluate, before filing suit, the tenant’s obligations and their likely ability to pay on a judgment, if pushed to the brink. Choosing the right cases and tenant’s to pursue is half the work. But if you take the attitude, before you start that why bother, you will never collect what is owed to the landlord. Part of the interesting thing about two of these cases is the fact that we were looking to and did obtain settlements for rents owing prior to a foreclosure. It is a common misconception that tenant’s who move out or owe rents, to a foreclosed upon, landlord, no longer have any lease obligations since the property was foreclosed upon. In fact, pre-foreclosure lease obligations may very will continue to accrue and be due to a secured lender and/or buyer after a foreclosure sale.

The economy goes in cycles and what goes up, usually goes down and back up again and so forth and so on. Just because the economy may be down, doesn’t mean that you can’t get your rent. If you are not prepared to go after your rent from tenants, I suspect that you shouldn’t be a landlord. Landlord’s need to, at the very least, look at what is owed, who owes it so that they can make a reasonable determination of what they can collect, when they will collect and how much it will cost to collect. This is very important information, even if you don’t want to evict a tenant and want to keep them in place.

Should an Electronic Listing Service Such as Loopnet be Required to Be Licensed as A Broker in Each State that it Lists Properties for Sale?

I recently read an interesting article distributed by the Associated Press and republished by the Silicon Vally, Mercurynews.com about the state of Nebraska's requirement that the owner of a property-listing website based in California, obtain a license to market homes in the Midwestern state.

Apparently Leslie Young filed a federal lawsuit, seeking a permanent injunction to stop Nebraska from enforcing the law, which she says violates her First Amendment rights, the Lincoln Journal Star ( http://bit.ly/Pu0WWf) reported.

We'll, as you will see, this got me thinking and when I start thinking, I get dangerous and write blog posts.

Ms. Young claims that her website, elistme.com, merely provides a way for sellers to advertise their homes, like a classified ad section in a newspaper. She does not act as a broker and does not receive a commission.  This sounds like a pretty good argument to me, if it is true. Now, of course, I don't know what is actually true but it was reported that in court documents that Young's Elist.me site has referred to her as "advertising broker."  Now if she is not acting as a broker, then why would the site list her as the advertising broker? Perhaps this was something, nothing more than sloppy copy or an inadvertant statement and in fact, she is not acting as a broker in the state of Nebraska.  But I would be so bold to suggest, that when you state that you are acting as the "advertising broker, " you are not passing the sniff test, which certainly warrants some initial due diligence on the part of the state of Nebraska.  My guess is that this is a matter that should be straightened out informaly, rather than by a lawsuit and that Ms. Young should make sure that her website not state or infer that she is acting in the capacity as a broker in the state of Nebraska or for that matter, in any state that she is not licensed to act as a real estate broker. Just as important, she should make absolutely certain that she does not actually act as a broker, notwithstanding how she might refer to herself on her website.

So you ask yourself, what does all of this have to do with Loopnet?  While Loopnet does not publish the availability of residential property on its website, (I don't think so, at least), it does publish listings for commercial property in most, if not all states in the United States. While I am sure that Loopnet has an army of attorneys that spend their entire day to insure that Loopnet fully complies with all state and federal laws, you do wonder, to what extent, there has been a lot of attention paid to the inner workings and agreements of these listing services, how they get paid and to what extent the agreements involve broker or broker like tasks. How close do they skirt the line as a mere advertiser versus broker?

Nebraska Real Estate Commission Director, Greg Lemon declined to specifically comment about Young's lawsuit. He said, however, that the Nebraska law addresses how property is marketed. He further expressed that if the ads direct potential buyers to the owner who listed it and no broker is involved, the law isn't breached.

Does that mean that if a commercial property is listed on Loopnet by a listing broker licensed in the state of Nebraska, Loopnet must be licensed as a real estate broker in the state of Nebrask?  That doesn't make any sense to me, if you take the above statement of Director Lemon at face value.

I think this all warrants some investigative reporting on this issue and I will report back in later blog posts.

How Do Tenant's Level the Playing Field to insure that Landlord's Play According to the Lease

Over the last few years, most of my legal practice has been either evicting commercial tenants or collecting rents. Although on occasion I do represent tenants, most of my time is advising and educating landlords and trying to maximize their return on their leases and property. My experience tells me that, unless a tenant has substantial assets to afford good legal and real estate representation, they have been at a distinct disadvantage dealing with an insuring that their landlord's deal with them in a fair way and in accordance with the terms of the lease.

I recently posted this comment on LinkedIn and did receive some comments and discussion, including the following comment from David Massie who wrote:

After working for some of the largest landlords in the US and directing their real estate companies for over 25 years managing millions of square feet and negotiating against hundreds of tenants, I heartily agree with Howard that tenants don't lease smartly. This is one of the main reasons I now only represent tenants.

Here is an article I wrote on the subject: http://www.djmcre.com/articles . Scroll down to the one titled "Commercial Leasing: Never Do It On Your Own.

It amazes me that tenants try to lease on their own or use the landlord's broker (or even same brokerage company) to do a dual rep. It's like going into court to defend yourself or using your opponent's attorney to defend you. Not highly recommended. And then there is the whole subject of why a tenant would not hire their own tenant rep broker since the landlord is paying for the commission, many times even for a lease renewal or expansion, and the landlord doesn't credit the tenant for saving him this commission payment.

In response, I wrote:

It is a common misconception among inexperienced tenants, that they will save money if they do not use a broker to assist them in the lease process and they can handle it themselves.  It is scary how wrong they can be.

That is part of the education process that as a broker, you need to do with your prospective clients.

I am a big fan of team building, particularly for the tenant who often does not have a team behind them when the negotiate a new lease.  The tenant needs an experienced and knowledgeable broker, a good attorney and should consult with a lease administrator to make sure that the lease anticipates common administrative issues that the broker and attorney might not be familiar with.  The lease administrator is the person who keeps the landlord honest over the term of the lease and is likely the one who knows all the little problems that cost the tenant money that don't make it to the broker and attorneys attention.

I will be talking about this team approach as the keynote speaker at the NRTA Annual Convention on October 7th - 10th in Palm Desert, California.  For more information on this topic, go to www.creradio.com