Tenant Representation to get Bigger NOW

Staubach deal unleashes growth in tenant rep business
Dallas Business Journal - by Bill Hethcock Staff writer
kenneth brock
TENANT REP WINDFALL?: Jim Lob of commercial real estate brokerage UGL Equis says firms that represent tenants and not landlords stand to gain now that The Staubach Co. has been bought by Jones Lang LaSalle. UGL Equis plans to add at least five tenant-rep brokers to its 10-broker team in Dallas.View Larger
Commercial real estate firms that represent tenants solely are planning to add brokers and take other steps to capitalize on the acquisition of The Staubach Co. by Jones Lang LaSalle.
The Staubach Co., based in Addison, was founded on the premise that the company would represent only users of office, retail and industrial space, thereby avoiding potential conflicts of interest with landlords. But Chicago-based Jones Lang LaSalle, which bought Staubach in early July, offers the gamut of real estate services, including landlord representation.
That creates opportunities for firms that continue to represent only tenants’ interests, said Jim Lob, senior vice president of commercial real estate firm UGL Equis’ office in Dallas. The firm plans to add at least five tenant-rep brokers to its 10-broker team in Dallas, and 50 throughout the United States, Lob said.
“The Staubach-Jones Lang LaSalle merger is the trigger” for the additional brokers, Lob said.
UGL Equis, like others that represent only tenants, also will more aggressively target companies that chose to be represented by Staubach because of that company’s focus on tenant rep, Lob said.
“Those of us still doing it are going to put our hands in the air and say, ‘Hey, we still strongly believe in this (business) model,’ ” he said. “This gives us a chance to differentiate ourselves again.”
But Mark Fewin, senior managing director of CB Richard Ellis Inc.’s Dallas office, said JLL’s acquisition of The Staubach Co. shows the growing importance of a business platform that provides a broad range of services. CB Richard Ellis represents landlords and tenants.
“The (JLL/Staubach) merger provides final validation to the argument that we have been making for many years — that both tenants’ and landlords’ best interests can be served by one firm,” he said.
Mohr Partners, which exclusively represents tenants, is looking to hire more real estate professionals in the aftermath of the JLL/Staubach merger, said Bob Mohr, the company’s founder, chairman and CEO. The company, which has about 60 brokers in Dallas and about 200 nationwide, plans to add 12 to 15 more nationwide, Mohr said. The additions are spurred not only by the JLL/Staubach deal, but by the broader consolidation trend, he said.
The Staubach Co.’s exit leaves Mohr Partners as one of the largest, if not the largest, tenant-only corporate real estate services firms in the United States, Mohr said.
The Staubach Co. played a significant role in the development of the tenant representation side of corporate real estate, said Ken Bailey of Dallas-based Fischer, a commercial real estate firm that also represents only tenants.
“The reason this approach became such a vital service to corporate America is the undeniable conflict of interest in representing the landlord and the tenant,” Bailey said in an e-mail.

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