Corporate office tenant rep fees
Hello.  I have a question about fee structures for commercial office search.  I’m a consultant who works with clients to define their future office needs, but I’m on the design &amp; construction side not the transaction of real Estate side. When we work with clients on a property search/ due diligence etc we typically work on a fixed fee based on anticipated number of hours.  The client will typically the go to a real estate company to manage market EOI, all the way to agreement for lease. How does their tenant rep charge for services?  Is it a percentage of total rental?  If so what percentage is typical and is that based on one year’s rent or the total rental over the period of the lease?   For reference assume a fairly large tenant of 50,000 sqm (500,000 sq ft). 

Just curious to have a bit of insight on the other side. Thx
[{"id": "fglcb68", "text": "Different markets/countries have different ways to calculate fees. \n\nIn the US I\u2019ve seen 6% of total rent for the life of the lease, split between tenant and LL broker. On large deals it can be 3 or 4% of total rent split between brokers. In your example it might be even less, as 500k SF is a massive deal. \n\nIn Asian markets fee is  typically one months rent. \n\nSo the answer is like answers to most real estate questions: it depends. \n\nIf you need an accurate answer for a client I\u2019d honestly just call a broker in your market and give her the example. She\u2019ll give you an estimate.", "replies": [{"id": "fgm1k0b", "text": "This is the most accurate answer for the US. Only thing that changes is when it\u2019s a sale. Otherwise leasing is almost always 6% split 3/3 or 4/2", "replies": [], "depth": 2}], "depth": 1}, {"id": "fglqiko", "text": "nyc broker collects from landlord never tenant.  even tenant rep, which is exactly what I did for years.  its a sliding scale based on the length of lease.  typically starts at 5, and will go down to there.   is based on gross rent not including utils.", "replies": [{"id": "fgn5i2r", "text": "Interesting. Is that standard everywhere?  Or is that something that is also market dependent as people have outlined in their answers?", "replies": [{"id": "fgo2pww", "text": "no idea.  I'd assume in most places owner would pay fee.  especially commercial", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "fgm0hlw", "text": "Many office deals are $1.25psf per year of contract.\n\n10ksf - 10 year deal - $125k fee.", "replies": [{"id": "fhpev1m", "text": "Interesting way of doing it. What market are you in?", "replies": [{"id": "fhpy32a", "text": " Chicago", "replies": [{"id": "fhq692y", "text": "So no matter what the rent is, it\u2019s still $1.25?\n\nThe DC market is 4% the aggregate value of the lease. So that same deal would likely be in the $250,000 range. But could be much smaller if the rent is lower", "replies": [{"id": "fhqqp91", "text": "Retail commissions are structured at 3-4% of net lease value - like you are suggesting.  Office commissions are more typically $1.25 psf per year.", "replies": [], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}]