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SAN FRANCISCO—A recent Q&A on Globest.com asked thequestion of whether tenants get better service working with asingle agency provider or a full servicefirm. The perception that there are conflicts inherent inagencies representing landlords and tenants isn't a new issue. But,in an era where some firms have adopted very robust globalplatforms offering clients a wide range of real estate services,it's not surprising that the debate is ongoing.

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To further examine the question, we sat down with two of JLL'sBay Area real estate experts: Wes Powell, whorepresents landlords in San Francisco, and BartLammersen, a tenant rep broker based in Silicon Valley, toget their perspectives on whether conflicts of interest are reallya concern in today's commercial real estate arena.

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Globest.com: It's been said conflicts of interestare inevitable in firms representing both landlords andtenants. Do you agree with that?

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Wes Powell:No. It's ageneralization and a self-serving statement. With a limited serviceto sell, single agents have to find ways to level the playingfield. An unsophisticated tenant may not see it as a generalizationthough, especially if they are not aware of the facts and benefitsof full service firms during the decision process. Virtually everylandlord and most global companies—organizations with trulyexperienced real estate experts—use full service firms.

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Conflicts can and do arise in any business model. I think anycompany that believes they are not susceptible to conflict isdeluding itself and doing a disservice to its clients. Of course,conflicts—or the appearance of conflict—can arise in a dual agencyenvironment. But there is a very high degree of transparency intoday's commercial real estate transaction and companies that serveboth owners and users can't afford to be less transparent than therest of the market. In fact, you'll find that firms like ours bendover backwards to be even more transparent precisely because thereare competitive models out there with entire marketing plansfocused on painting firms like us as conflicted.

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As a landlord broker, I find some of the best tenant rep workI've experienced is from full service brokers due to the strictfiduciary responsibility and breadth of knowledge they bring to atransaction. In the last real estate service provider qualitybenchmark, the Watkins Survey (2013), one of the things our firmwas lauded for was its ability to understand and avoid conflicts ofinterest. We work very hard to make sure conflicts don'tarise and, on the rare occasion even a perceived conflict exists,we move quickly and decisively to correct them.

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Globest.com: It's also been suggested thatfirms that exclusively represent tenants are the best equipped toservice the real estate portfolios of companies today. How do youanswer that?

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Bart Lammersen: I don'tthink that is the case at all. Our tenant rep practice is oneof the biggest and most respected in the region and country. Wesjust mentioned the 2013 Watkins Survey. What he didn't mention wasthat since 2005, JLL has consistently been ranked the top corporatereal estate services provider in that survey.

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Let's just put that in perspective: the Watkins surveyranks 23 corporate real estate service firms, including fullservice firms like JLL as well as tenant-rep firms, based on 10criteria. In 2013, JLL placed first or second in seven out ofthose 10 criteria and we ranked first overall. Since those surveysare based on responses from corporate real estate professionalsrepresenting about 200 different companies, I think that shows manycorporations believe we are more than equipped to provide the levelof service they desire and deserve, and that we deliver realvalue.

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Globest.com: How about some examples of howyou meet those expectations and the value you helpdeliver?

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Lammersen: In 2013, our tenant repteams completed a total of 7,835 lease transactions totaling 175million square feet. Some of these transactions includedrepresenting the third largest craft brewery in the US in locatingand negotiating a lease for a new 200,000-square-foot brewery anddistribution facility that allowed the company to double capacitywhile reducing its carbon footprint. We advised a major bank inanalyzing and optimizing its strategy for its 1,200-propertyportfolio and we are partnering with them to develop a system widegreen sustainability program. We also saved a major law firm 25% inits overall real estate costs by helping them develop an overallreal estate strategy and we helped a leading financial servicesfirm manage its growth and acquire the land for and build a newLEED Gold headquarters in which it could consolidate severaloperations and improve employee collaboration.

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Historically, companies have relied upon real estate servicefirms for primarily brokerage. Today, most corporationsexpect their real estate provider to do more than just lease them abuilding. Our clients have come to expect and demand more valuefrom their service provider and that's why firms like ours aredelivering greater value on both sides of thetransaction.

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Powell: That's right. You'll note thatwith all the assignments Bart just mentioned, we deliveredsomething to the client that was much more than just a tenant repadvisory job culminating in a real estate transaction. Theadvantage we have is that all of our service—agency leasing, tenantrep, capital markets advisory, engineering, property management,project management, energy and sustainability services and a hostof others—can leverage each and every part of the entire platformacross a truly global footprint. So, for example, a corporateclient in Europe, looking to expand in the US by building a LEEDGold campus in Silicon Valley, can access not just our corporatereal estate solutions expertise in Europe, but through ourInternational Desk in Palo Alto they can access resources that canadvise them on where to build, how to build, how to manage costs,how to achieve energy efficiency and sustainability goals, as wellas how to access capital, achieve tax incentives and a host ofother factors.

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Only a multi-disciplined and coordinated firm with access to allof this information can achieve this in a best of class manner. Onething is clear: real estate is, indeed, one of the largest costfactors for companies and the real estate environment thatcompanies operate in today is much more complex than it was 20years ago. Our tenant clients have told us that they want access tomore services and advice, not less, so they can better plan theirreal estate strategies. Having all of these services underone roof benefits clients on both sides of a real estatetransaction.

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Globest.com: So, is there a place for single agencyfirms in today's market?

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Powell: Sure. Single focus corporatereal estate firms aren't going away. Interestingly, if you lookback decade to decade, you will find these firms often grow withtalented people and in more cases than not, morph or sell intolarger full service firms with the uniform stated objective:improved results for clients. Nonetheless, there will always beplenty of smaller and mid-sized corporations that continue to relyon their advice and expertise.

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To see a video explaining how one tenant valued a fullservice approach in selecting a new Silicon Valley headquarters,clickhere.

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Natalie Dolce

Natalie Dolce, editor-in-chief of GlobeSt.com and GlobeSt. Real Estate Forum, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.