There is a question worth asking any property adviser before you instruct them, and very few occupiers ask it: who pays you, and have you ever been paid by the other side of this transaction?

The answer shapes every piece of advice you will receive, and in most of the London retail market the answer is the landlord.

How the market is actually structured

Traditional retail agency is built around landlord instructions. An agent is retained to let a building, paid on completion, and their duty runs to the owner. That is a legitimate business and the people doing it are often extremely good at it. But it means the person showing you a unit is being paid to fill that unit.

The consequences are subtle rather than dramatic. You will not be lied to. You will simply be shown the units your adviser is instructed on, told that those units are the market, and encouraged toward the deal that completes rather than the deal that is right. The unit that would suit you better, three streets away, held by someone who has not yet decided to market it, does not enter the conversation because nobody is paid for it to.

What acting for occupiers changes

I act for the occupier, and only for the occupier. That single constraint changes the work in four ways.

• The search is not limited to available stock. If the right unit is occupied, the question becomes whether the occupier might be persuaded to move, and who can have that conversation.
• There is no incentive to complete. Advising a client that none of the current options are good enough, and to wait, costs me a fee. It is frequently the correct advice.
• Negotiation is genuinely adversarial. I am not managing a relationship with a landlord I will need again next month for a different instruction.
• The advice extends past the transaction, into rent reviews, renewals, regears and exits, where most of the money is actually won or lost over a lease term.

The uncomfortable part

Independence has a cost, and it is worth being honest about it. An agent with landlord instructions has stock, relationships with owners who need them, and an obvious commercial reason for those owners to take their calls. Building equivalent access without landlord instructions takes years and depends entirely on being useful to people who owe you nothing.

It also means turning down work. Acting for a landlord on a letting and for an occupier looking at the same street is a conflict, and the only clean answer is to decline one of them.

What to ask before you instruct anyone

Whether or not you work with me, these questions are worth asking.

• Are you ever paid by landlords or developers, on any instruction?
• On this search specifically, do you hold any instruction from an owner on a street we are considering?
• What proportion of the units you will show me are ones you or your firm are instructed to let?
• If the right answer is that I should not do a deal this year, are you able to tell me that?

The last question is the one that matters. An adviser who cannot afford to tell you to wait is not advising you.

Why this is not a moral argument

None of this makes landlord agency wrong. Landlords need representation and the good ones deliver it well. The point is narrower: you should know which side of the table your adviser sits on, because the answer determines what you will be shown and what you will be told.

Most occupiers assume the agent showing them units is working for them. Usually they are not. That assumption costs more than any fee.

Further reading: What a Retail Property Adviser Actually Does · The Clients Who Come Back · About Aldo Attanasio d’Aponte

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Aldo Attanasio d’Aponte is the founder and chief executive of Arbitrage Group, a boutique buyer-side advisory specialising in prime central London real estate. This article is general commentary and not financial, legal, planning or tax advice.