In the last few years, we have seen remarkable growth in demand for the services offered by tenant referencing companies. That has, in turn, led to an upsurge in the number of such companies in operation, even as those which were in operation previously have tended to expand. The exponential growth in number and size of companies offering tenant referencing services suggests that demand for those services is going up. That is the trend we are trying to make sense of.
We may pause here, briefly, and first try to appreciate the basic nature of the services offered by companies. That is where we’d come to learn that these are companies which, on behalf of landlords and real estate managers, screen prospective tenants. Experience, over the years, has shown that renting out business premises or residential quarters to the wrong people is extremely hazardous to the real estate business. That led real estate owners (landlords) and their agents to devise the tenant referencing system, where they seek to know something about the backgrounds of the people they rent their premises to, before actually getting into the rental contracts.
Now the real estate owners and their agents can either do the tenant referencing by themselves, or hire professionals to do it for them. The professionals hired for this sort of work normally work under the banners of ‘tenant referencing companies.’ It emerges that, as we noted earlier, demand for the services offered by such companies has been growing exponentially in the last few years. We are trying to find out what is causing this trend.
As it turns out, the growth in demand for the services offered by tenant referencing companies is brought about by among other factors:
1. Growing awareness about the need for tenant referencing in the real estate management community. This is what creates demand for the services offered by the companies which do such referencing professionally. The awareness itself is created through the media, property owners seminars and so on. Every property owner who decides to start checking out people before letting them into his or her premises automatically becomes a potential client to one or another tenant referencing firm.
2. Growing realization by many landlords and real estate managers that they can’t do effective tenant referencing on their own. Real estate investors tend to be relatively ‘tight’ individuals, who won’t pay for something unless they are sure that they actually need it. Many, upon realizing that they need to be screening potential tenants opt to do it by themselves initially. But they soon come to realize that there are many ‘privileged’ bits of information they can’t be allowed to access in their individual capacities. They come to realize that they need a ‘go-between’ if they are to get real tenant referencing done. And each real estate investor who comes to this realization of course turns out to be a potential customer for one or another firm.
3. Sustained marketing efforts by the companies. Although such companies have been around for quite some time now, it is only recently that, as an industry, they have started making an effort to create widespread public awareness on what they do. Each awareness campaign tends to bring ‘rope in’ a certain number of landlords and real estate managers, who soon or later need such referencing services. Stadium LED Display