To lease out space for an owner of a building, Do you charge a percent for the term of each office leased.

In Leasing Property - Asked by Kyle S. - Mar 12, 2012
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Answer(s)

Nick S.
Broker/Agent
Ithaca, NY

There are several different ways that commission can be calculated for leasing space in a building. As with any commission, the amount and method of calculation must be agreed upon by the broker and the owner. Typically though, commission is calculated separately for each space leased.
One common way to calculate a commission is to take a flat percentage of the entire value of the lease. So for a five year lease on a 5000 sqft space at $12/sqft the commission would be a percentage of $300,000 (5 years * 5000sqft * $12/sqft). This commission is typically paid in a lump sum at the start of the lease, though other payment arrangements spreading the commission over the life of the lease are not unheard of.

Mar 12, 2012
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Chris R.
Broker/Agent
Denton, TX

Typically each lease would be negotiated between all parties and the lease commission agreed upon would be paid for each one based on the terms agreed to. The commission is calculated typically as a % of the total amount of the rent scheduled to be paid over the term of the lease. Typically paid 50% on lease execution and 50% on move in or could be all at the same time if lease and move in are near or one and the same.

Mar 13, 2012
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Juan V.
Broker/Agent
East Chicago, IN

The two replies are correct. I would also make sure to negotiate the compensation with the landlord/owner for the entire building upfront. Also, the renewals have a commission at the time of renewing.

Mar 14, 2012
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Barbara B.
Broker/Agent
Jacksonville, FL

All answers are correct, some more so in different areas. To make certain there is no dispute as to whether I have to bring in the exact listing rental rate per the listing agreement to earn a commission I include the following phrase: "or any amount agreed to between Lessor and Lessee."

Mar 14, 2012
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Ivan J. V.
Broker/Agent
Walnut, CA

March 14, 2012
QUESTION: what % is charged X $ 300,000
IJV - Broker, Walnut, CA 91789
Thank you.

Mar 14, 2012
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