Skip to content
×
PRO
Pro Members Get Full Access!
Get off the sidelines and take action in real estate investing with BiggerPockets Pro. Our comprehensive suite of tools and resources minimize mistakes, support informed decisions, and propel you to success.
Advanced networking features
Market and Deal Finder tools
Property analysis calculators
Landlord Command Center
$0
TODAY
$69.00/month when billed monthly.
$32.50/month when billed annually.
7 day free trial. Cancel anytime
Already a Pro Member? Sign in here

Join Over 3 Million Real Estate Investors

Create a free BiggerPockets account to comment, participate, and connect with over 3 million real estate investors.
Use your real name
By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.
The community here is like my own little personal real estate army that I can depend upon to help me through ANY problems I come across.
Commercial Real Estate Investing
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

Updated 9 months ago, 04/04/2024

User Stats

31
Posts
2
Votes
Michael G.
  • Investor
  • Camp Verde, AZ
2
Votes |
31
Posts

Commercial Lease Renewal Option - Commissions - who pays?

Michael G.
  • Investor
  • Camp Verde, AZ
Posted

We have an office building with a great long term tenant, that is in a below market rates, and we're good with it because they are stable and NNN. Their lease is up for renewal, and contains one Option to renew, which they've notified us they want to exercise. We sent over a simple form to execute the option, but tenant says they work with a broker on their real estate leases. That broker sends over a lease LOI with terms very disadvantageous to us, one of which is that WE pay him a commission (essentially to negotiate against us).

My question is:  Is it typical that the Landlord pays a commission (4%) in a case like this?  It's our existing tenant who wants to stay at a great rate, and we want to rent to them at that great rate.  If the tenant insists on using this broker (their choice, I guess), we're obviously just going to bake the commission into their new monthly rate because we're certainly not going to absorb a 4% commission to keep our existing tenant on executing a simple lease option.

Loading replies...