TX commission for commercial retail lease and renewals?
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[{"id": "grbi0zq", "text": "I\u2019ve seen 6% commission on base rent of the entire initial term. Usually half paid on signing and half paid on commencement.", "replies": [], "depth": 1}, {"id": "grcr8do", "text": "The renewal is generally less, but it depends on what\u2019s in the listing agreement or what the agent asks for. So, if you don\u2019t have a listing try to work it in to the LOI otherwise you\u2019ll get nothing. Half upfront half upon rent commencement.", "replies": [], "depth": 1}, {"id": "greverb", "text": "Renewals are usually 3% with 1.5% to LL representative and 1.5% to TT representative.\n\nInitial term is 6% with splits being 3% to LL rep and 3% to TT rep. Generally for any term longer than 5 years, the first five years is at 6%, then drops to 3% for the balance of the term", "replies": [], "depth": 1}, {"id": "grhapi4", "text": "TL;DR at the bottom.\n\nI'm a CRE Broker in Austin, TX. The best (and worst) answer is: \"It depends.\" Commission rates, like everything else in CRE, are negotiable. Since I've only worked in CRE in the Austin MSA, I can only speak to my experience in this market.\n\n**When is it paid?**  \nIt depends on the lease documents. Is the lease drawn up on a Landlord-generated lease or the Texas REALTORS\u00ae Commercial Lease template? \n\nIf the latter, Section 32 has the option to say that the commission is paid according to either (1) a separate agreement between Landlord and Principal/Cooperating Broker or (2) the attached Addendum for Broker's Fee. If the addendum, that is where you spell out the commission amounts and when it is paid, both for the initial term and the renewal. Typically, the first 1/2 the commission is paid at lease execution, and the second half upon Lease Commencement (which may be different from the day the Tenant first occupies the space).\n\nIf it is a Landlord-generated lease and/or a separate agreement, that needs to address when commissions are paid. I'm currently repping an Industrial Tenant (LL-generated lease, separate commission agreement). The agreement says 1/2 is paid within 30 days of lease execution and 1/2 within 30 days of Lease Commencement Date.\n\n**What is the going commission on new leases?**  \nAgain, it depends. On new leases, it is typical to see a total of a 6% commission paid out by the Landlord to all Brokers, although I've seen 7-8% recently as well. Some Landlords only pay on the value of the Base Rent, while some pay on the Base + NNN (aka OpEx or \"expense reimbursements\").\n\nIn Austin, it is common to see 4% to Tenant's Broker and 2% to Landlord's Broker. Don't ask me why, but if you are an active broker with a mix of Tenant and LL Rep work, it tends to balance out to 3% over the course of multiple deals.\n\n**What is the going commission on lease renewals?**  \nSome Landlords won't pay Tenant Brokers anything on a renewal, some will only pay if the Broker is involved in any renewal negotiations, and others have no problem paying on renewals. A lot depends on the Landlord/situation/relationships. Also, it isn't too common in the Austin area for Landlords to pay a renewal commission beyond the first renewal.\n\nIn Austin, renewal commissions tend half of the initial lease commission percentage. The split is usually the same as the initial lease, so 3% total, split out with 2% to Tenant Rep, 1% to LL Rep. That commission is paid usually at the earlier of the date the new lease is (1) executed or (2) commences.\n\n**Word of warning from experience:** NEVER have the commission paid out upon occupancy date. That date is fluid, and the Tenant may never actually \"move into\" the leased space. Lease Execution Date and Lease Commencement Dates are clearly defined in the lease, so there is a lot less ambiguity.\n\n**TL;DR** \\- In the Austin market, it is common to see\n\n* New Lease: 6% commission, with 4% to Tenant Rep. \n* Renewals at 3% with 2% to Tenant Rep. \n* Commissions are usually paid out with 1/2 at lease execution and 1/2 at the lease commencement date.", "replies": [], "depth": 1}]