Glossary / Commissions and splits
Also known as: Landlord rep, listing broker, leasing agent
Landlord representation is when a broker works for the property owner to market vacant space, find and screen tenants, and negotiate leases. The landlord rep is paid under a listing agreement, and often shares the leasing commission with the tenant's broker.
A landlord rep, often called the listing broker or leasing agent, represents the owner. Prophia describes the role as marketing space, identifying prospective tenants, screening them (including checks on their financial stability), negotiating lease terms, and handling renewal negotiations with existing tenants.
The relationship is set by a Listing agreement. State forms show how these are built. The Oklahoma Real Estate Commission's commercial listing agreement form, for example, lets the owner set the broker's compensation for leases and divide it between the listing broker and a cooperating tenant's broker, while stating that the split "does not increase Owner's obligation."
As listing broker, you usually collect the full commission from the landlord and pay out the tenant broker's share. Wikipedia's leasing commission entry describes this structure and notes that splits vary. What you keep depends on that co-broke share plus your own Commission split with your firm.
When you are paid depends on how the listing agreement defines "earned." The Oklahoma form, for instance, says compensation is earned only after the owner and tenant execute an enforceable written lease, any tenant right to cancel during a due-diligence period has expired or been waived, and rent has commenced. It also states that a broker "earns no compensation merely by producing a prospect." Under language like that, your payment date follows the Rent commencement date, not the signing date. Other agreements pay at execution or in installments, so read yours.
Read the "earned" and "payable" clauses of your listing agreement and map each one to a lease date so you know when cash actually arrives.
