Question about realtor fee's to rent out commercial property

[Dillon McGough]

Pardon my ignorance as I have zero experience with commercial properties.

I'd like to know the typical fee's paid to realtors for finding commercial tenants.  

I have a realtor friend that is negotiating a contract with a commercial building owner to lease out empty space in his building.  What does compensation typically look like for a realtor that advertises and brings in a tenant?  I'd like to know typical fee's if that realtor brings in a tenant that is not represented by another realtor along with the typical compensation if the deal has a listing realtor and a realtor that brings in the tenant?  Hopefully this makes sense

[Ganesh S.]

Hi Dillon

I am not a realtor, but can tell you what I pay as an investor/owner. 

- Everything is negotiable, sometimes I wont pay the lease fee to realtor immediately but pay in installments as the rent is received. Typically for high risk tenants. 

- First of all the total amount the lease is worth for needs to be calculated = No of years * Yearly rent. For e.g. if yearly rent = 50K and the lease is for 5 years with one option to extend, then total value of the lease is 500K.

- The total lease fee is payable (split between leasing agent and clients agent) could range from 4-6%. More close to 6% if there are two agents or close to 4% if there is a single tenant.

- If the leasing agent also acts as the property manager, then they may be willing to reduce the % as well.

Hope that helps

GS