Commission on commercial lease

5 Replies

I am an agent who's brought a tenant to a commercial broker. My customer likes the property and his partner will see it in a few weeks. When do I discuss commission with the broker, and what is typically the commission on a commercial lease in Florida?

Commissions usually vary 5%-6% on average and are paid for the entire length of the lease (total amount of rent added up for all years) in most cases.

Thanks, Darren. I'm assuming this would be addressed at the time my customers decide to go ahead and lease the property?

I discuss commission before we take anyone out. The rate of 5%-6% was based upon the gross commission that the incoming tenant was expected to pay. That total % gets split between the listing agent and buyer's agent depending upon the % agreed upon by the owner and listing agent. @Joel Owens can confirm this as he does this regularly. I would say that as a buyer's agent that we normally let our clients know that we work at minimum % of 2.5%-3% when a listing is concerned and 3.75% where there is no listing and we found the off market property. Always get your conversation about how you get compensated out of the way FIRST! And don't waste your time if they have an issue with it.

Darren, you've been so helpful! Thank you so much. I will take care of this ASAP.

Nancy are you at a commercial brokerage that specializes in leasing??

When you say commercial broker are you talking about the landlords rep for the building who put the lease listing out??

Commission is negotiable. The landlord might offer some upfront and then ongoing commission during the lease term. The reason is the tenant might default at some point and the landlord doesn't want to pay total rent commission today off of months they never received the money.

As the broker/agent you want to try to get all the money today or the most you can. The reason is any number of things can go wrong with the owner of the property or the tenant leasing the space. In those situations payout of the monthly lease commission is dead last and you might not get anything.

I don't do leasing as I am on the transactional sales side. I want all my money TODAY.

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