Commercial Real Estate Leasing Commission Split
Hello Everyone. I just got real estate licensed in Illinois and I work at a commercial real estate firm. I'm curious about how the commission split between a managing broker and a broker usually works on leases, acquisitions, and dispositions.
[{"id": "cc9wnjd", "text": "All fees are typically 50/50. It doesn't really matter what type of transaction it is. Unless there is another agreement you work out with your MB, larger firms are either 50/50 or 48/52. ", "replies": [], "depth": 1}, {"id": "cc9yxdp", "text": "Brokerage is a pyramid scheme. Mg partners hire new brokers who'll bust their ass cold calling to maybe get 3-4 deals before flaming out. Those 3-4 deals you'll bring a mg broker who you'll split your commission in half with. Then There is the house split which usually starts at 50/50 and works its way to your favor the more money you make which most new brokers never see. Example: you bring in a 100k deal. Bring in partner because you're new. Your take turns into 50k. Then you split with the house based on your net total to the firm. In this case your 50k net is subject to another 50% to house. So in summary, your 100k deal you brought in gets you 25k before Uncle Sam takes his cut. If you're asking this question now after you already signed on to a firm, you're probably in over your head. But I wish you luck. ", "replies": [{"id": "ccgcq84", "text": "&gt;&gt;Brokerage is a pyramid scheme. Mg partners hire new brokers who'll bust their ass cold calling to maybe get 3-4 deals before flaming out. Those 3-4 deals you'll bring a mg broker who you'll split your commission in half with. Then There is the house split which usually starts at 50/50 and works its way to your favor the more money you make which most new brokers never see. Example: you bring in a 100k deal. Bring in partner because you're new. Your take turns into 50k. Then you split with the house based on your net total to the firm. In this case your 50k net is subject to another 50% to house. So in summary, your 100k deal you brought in gets you 25k before Uncle Sam takes his cut. If you're asking this question now after you already signed on to a firm, you're probably in over your head. But I wish you luck&lt;&lt;\n\nWhen your brokerage provides good services,  like help your phone ring, assistance in closing deals, office etc,  I have no issues splitting 50/50. I have been in situations whee my brokerage splits were 70/30 and I made far less money doing everything myself.  I do very well.  ", "replies": [{"id": "ccghbrn", "text": "Jon - I agree with you under those circumstances. If your Partner held true to that arrangement and there wasn't an additional house split stacked on top of your original split.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "cca1g8k", "text": "60/40 at my company.  Also, as year goes on and you make more you get to keep more.", "replies": [{"id": "ccau8gp", "text": "was that 60 up to the company?", "replies": [{"id": "ccaxb0q", "text": "no, 60 is what I keep, and it goes up to as high as 85% if I hit certain performance levels.", "replies": [{"id": "ccbqjex", "text": "ok cool same for me", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "cca2jzc", "text": "You don't usually have much of a leg to stand on when negotiating a commission split as a newbie, but the standard is usually 50/50 between the company and the sales associate. You can increase this split through negotiating based on what you bring to the table as a broker and how many services they provide. If you are referring to the split/referral that you may structure through a senior broker and junior broker, the split may range from 50/50 to 20% of the deals he hands off to you. ", "replies": [], "depth": 1}, {"id": "ccahge0", "text": "It depends on where you are, and what arrangement you have with your manager. I don't know how it works in your case, but it's definitely something you want to have hashed out as strictly as possible BEFORE it becomes a big issue. If you keep it professional, it won't become personal (or, will become less personal).\n\nThat being said, it seems like it kind of sucks, that you feel like you're doing most of the legwork and having to pay out your senior broker, your brokerage shop, taxes, &amp;c. But remember that you're brand new, so he's taking a pretty big gamble on you. When you screw up, and you will (as I still constantly do), he's the one with his neck on the line, who the client will call and scream at, who the ethics board will want to \"just have a chat\" with. He takes a pretty big risk on you, and is compensated for it.", "replies": [], "depth": 1}, {"id": "ccaqff6", "text": "I'm an office broker in Chicago working for a Big 3 firm. For us, it depends on production. If you maintain certain thresholds, your splits increase, but they start at 55-45. 55% going to the house.\n\nHow it is split between your team, however, is a different matter. I only get 15% of the net commission to our team, but I am only an associate. I also wouldn't be involved in most of the deals in which I participate if I were on my own. Its a trade off.\n\nAlso, smaller shops will typically give better splits, but you are trading the splits for brand recognition and resources.", "replies": [], "depth": 1}, {"id": "cd34k1j", "text": "50/50 is pretty standard. Most have it scale though, so the more money you bring in the better your split.", "replies": [], "depth": 1}]