Conflict of Interest Concerns in CRE

SAN FRANCISCO—Even as the economy slowly recovers, Bay Area businesses are still in a cost-cutting mode. As companies scrutinize the bottom-line, they typically pay special attention to commercial real estate, which continues to be their second greatest expense, after labor costs. That is according to Mike Michaels, a managing principal at Cresa San Jose. In this environment, with millions of dollars at stake, he says, many companies today aren’t satisfied with business as usual. “They’re looking ‘outside the box‘ to save money, reduce risk, and add value.”

Michaels tells GlobeSt.com that “When companies need a real estate service provider, conventional wisdom suggests they seek firms that will put their interests first. And, since the client-broker relationship is all about trust, conventional wisdom also suggests that companies insist on accountability, transparency, and full disclosure. But conventional wisdom doesn’t always prevail.”