Read my section titled Fair Market Rent – Misconception for context.
The obvious and general meaning of “fair” is whether everyone is playing by the same rules. In a business sense the term “all is fair in love and war” doesn’t translate well to the public sector. We are not talking about immoral or unethical activity, even though I have see both during my many years in the business, but rather the tussle between private sector and public sector adversaries. You seemingly have two sets of “rules” in one game.
Private sector negotiations are predicated on the notion of a win-win outcome, however there is no mention of fair play. The public sector’s use of the word “fair” is literal, being free from self-interest and un-biased, amongst other meanings.
An investor in real estate (the landlord) has only one interest in real estate negotiations, to maximize revenue for its shareholders, which is a self-interest. As a public sector user (the tenant) of real estate you want to conduct a fair negotiation. As you can see in this simplistic overview, the word “fair” has very limited applicability when it comes to negotiations between private and public sector entities.
I have seen over the years the diminished use of the word “fair” in describing market rent. Hopefully we’ve seen the last of it.