In tight markets, they know which spaces are likely to come on the market. In markets glutted with space, they know which landlords are willing to make financial concessions to lease space. But that information is becoming more accessible to anyone willing to pay a price. Two national service companies, CoStar and RealtyIQ, collect information on property and transactions and make it available to online subscribers for a fee. As a result, the value of market knowledge is suddenly much lower.
Brokers are also expensive.
The standard fee for an office transaction in New York is one-third of the first year's base rent, paid by the landlord. Top brokerage executives acknowledge that there may be some erosion of their business, particularly in markets for small office spaces. But there may be a part of the market, maybe up to 10,000 or 15,000 square feet, that could become a commodity and trade on the Internet. Co. Real Estate, in New York, agreed. It might be useful for small tenants who cannot get the attention of a broker.