Glossary / Commissions and splits
Also known as: Co-op broker, outside broker, co-broker
A cooperating broker is a broker from another firm who works with the listing broker to complete a deal, usually by bringing in the buyer or tenant. In commercial leasing this is often the tenant rep broker, paid under terms set by the listing broker or landlord.
National Association of REALTORS policy defines cooperation as "the obligation to share information on listed property and to make property available to other brokers for showing to prospective purchasers and tenants when it is in the best interests of their clients." Wikipedia notes that a listing contract may authorize the listing broker to cooperate with other brokers and detail the compensation offered to them if they procure a buyer. The New York City Bar's model office brokerage agreement calls these brokers "outside brokers."
Cooperation and compensation are separate questions. Edward Smith Jr., writing in the New York Real Estate Journal, cautions that cooperating brokers "may not assume that the offer of cooperation includes an offer of compensation," and recommends a signed agreement or acknowledgment before introducing a client.
Rule changes add to that. NAR's summary of MLS policy changes that took effect August 17, 2024 says the MLS "must not accept listings containing an offer of compensation" to other participants. Whether a given commercial listing service is subject to those rules varies, so confirm your compensation directly with the landlord or listing broker. How you are paid also matters: the NYC Bar model offers options where the landlord pays the outside broker directly or where the listing broker is responsible for paying them. As a backstop, a tenant brokerage agreement such as the Florida Realtors commercial form can make the tenant responsible for your fee, with credit for anything the landlord pays. Being the Procuring cause may matter if another broker claims the same tenant.
Never treat a listing as an offer to pay you; get the amount, the payer, and the timing in writing first.
