A new study by George Washington University’s Center for Real Estate and Urban Analysis has rekindled the debate over whether there are conflicts of interest at some of the country’s largest commercial real estate brokerages.
Brokers who represent only office tenants have argued for years that conflicts exist at firms that represent both landlords and tenants—and that their tenant clients often suffer as a result. Brokers at the so-called full-service firms that represent both have argued back that such potential conflicts aren’t an issue, partly because they typically disclose such relationships to all of their clients.
Executives at full-service firms who have read the study, which was released late last month, have challenged its conclusions, pointing out that their professional ethics require them to represent their clients’ best interests, whether they are landlords or tenants.
They also noted that the study was undertaken by the Center for Real Estate and Urban Analysis in partnership with Boston-based Cresa, one of the largest firms that represents only tenants and a big critic of the full-service firms.
The report recommends further study, better self-regulation and the development of a “model code of conduct” in the commercial brokerage industry.
