Rental Property Investor · Salt Lake City, UT · Member since 2018 · 60 posts · 18 votes
Hi all
I am looking for a great broker that can help me locate a spot for a store we are wanting to open in Orlando. I haven’t had much luck with the current broker we’re using. Looking to find a location to lease and potential of several other stores opening as well shortly after. Who do you recommend?
Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
6y
Check ICSC ( International Council of Shopping Centers ) website and directory for a tenant rep leasing broker.
You have to find a broker that really likes commercial leasing because not much money in it compared to transacting.
I don't touch property management or leasing broker.
200,000 gross income center to manage at 4% fee is 8,000 a year if principal broker keeping it all.
Leasing a Starbucks tenant to a center maybe make 15,000 to 20,000 commission.
Sell a retail center for 3 million maybe make close to 100,000 commission
These are amounts for principal broker for their own company an they keep it all pretty much. If they work for someone else these payoffs can be much smaller.
Real Estate Agent · Bala Cynwyd, PA · Member since 2016 · 67 posts · 29 votes
6y
Joel, On the leasing example you cited, it's more like $50k assuming 4%, and not unheard of to get more. Also, transaction volume is higher in leasing versus sales.
Real Estate Agent · Bala Cynwyd, PA · Member since 2016 · 67 posts · 29 votes
6y
Hi Susie,
I've used Katz & Associates in Florida and they've been great to work with - they are primarily retail/shopping center leasing brokers. Vanesa Rodriguez with Katz is based in Orlando. Good luck.
Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
6y
Sometimes inline leasing only for 5 years primary versus 10 years free standing.
I generally see 5% leasing commission with the landlord wanting it at least evenly split between landlord leasing rep and tenant leasing rep. If no tenant rep or landlord rep then landlord tends to want to pay less of an overall fee maybe 3.5 to 4% instead of 5. So many factors go into it with national, versus regional, versus local tenant.
If a tenant rep broker brought me an A investment grade tenant signing a 10 year primary lease with good terms to me the landlord then of course I would be open to paying a premium fee. If they bring a mom and pop unknown type with lots of risk then I want to pay a lower fee and structure the fee to payout over time in case the tenant doesn't survive.
A landlord in a lot of cases would be a fool to pay out a high commission on an executed lease to an unknown tenant and lots of tenant improvements just to see that tenant fail right away or in a few years and have to pay those cost again for another tenant.
I would rather my clients wait for the right tenant for long term success than to back fill quick in a center for some cash flow today. It's just like a junk tenant in a house in the long run you lose more by putting someone in marginal right away.
The key Susie is if the tenant leasing broker enjoys that kind of thing or is doing it between sales because they have to. Find someone that really enjoys doing that and going over the details.
Landlords typically like A locations to attract top market rents and national tenants as the property then resales usually for the lowest cap rate and highest market value. The B to C locations where national tenants might pass is more the mom and pop type tenants where landlords fill those centers with.
Look for your location to have cross-traffic drivers to the site or around the site. Large anchors think ( Super Target, Super Wal-mart, Lowe's, Costco, Home Depot,etc.) . Junior anchors close by like pharmacy Walgreens or CVS, Mcdonald's, Chick Fil A, Starbucks. Then look at retail center mix if you are not leasing freestanding stand alone building.
