You are the landlord representative. You have a listing agreement that states that "X" commission will be paid by the landlord to you. The landlord expects that you will deal with the commission split in a cooperative transaction out of the agreed upon commission.
However, if a co-op agent asks for more have him put his request in the LOI.
There are several things that could happen. Among the most obvious are:
1. The landlord accepts the LOI amount and pays you 50% of the agreed upon listing commission.
2. The landlord turns the LOI down because of the commission amount.
3. The landlord accepts the LOI but makes you take less than 50% of the listed amount.
It is times like this that you must apply the skill of a high wire, tight ropewalker. The more skill you have and the better command of "the net" (the landlord") the more you will get to the desired place in the art of commercial real estate leasing.
There are several considerations in your arsenal of leasing steps toward a presentation of the LOI:
1. What is the bottom line for the landlord in the total value of the lease to him or her, considering all costs of tenancy?
2. What demand is there for the space?
3. What is the quality of the tenant?
4. How long may it be before the space might otherwise be leased?
5. What is the real consideration of the extra amount of commission in the total evaluation of value to the landlord?
6. How valuable are you to the landlord?
Onward and upward Mari…. Rob Baird, CA RE License #544165 (One of the oldest, active licenses in CA) 951 515-5855 Email: firstname.lastname@example.org
Apr 25, 2011