Commercial Lease Commission Calculator
A commercial lease commission is a percentage of the total rent over the lease term, usually paid by the landlord on a declining schedule such as 6-5-4-3-3%. On a 10,000 SF, 5-year office lease, that commonly works out to a five or six-figure commission, with roughly half paid at lease execution and the rest at occupancy.
How commercial lease commissions are calculated
A leasing commission is calculated on the total value of the rent over the term of the lease, not on a single year. The base formula is straightforward: rentable square footage multiplied by the rent per square foot gives annual rent, multiplied by the number of years gives total lease value, and the commission rate is applied to that.
The wrinkle is the rate. Commercial leasing commissions almost always use a declining schedule rather than one flat percentage, because the early years of a lease are worth more to the landlord. A common structure pays a higher rate on the first year or two and steps down each year after, for example 6% in year one, 5% in year two, then 4%, 3%, and 3%. The calculator above applies whatever schedule you enter and totals the result for you.
Worked example: a 10,000 SF office lease at $30 per square foot, on a 5-year term with a 6-5-4-3-3 schedule. Annual rent is $300,000. Apply the schedule year by year and the total commission lands at roughly $63,000. Change the rate, the term, or the rent and the number moves with it. For the full breakdown of the math, see the guide on how to calculate a commercial leasing commission.
How to use this calculator
Enter the leased area in rentable square feet, the base rent per square foot, and the lease term in years. Set your commission rate, either as a single flat percentage or as a declining schedule using the year-by-year fields. If your deal is priced on effective rent rather than face rent, use the effective rent option so free-rent periods and concessions are reflected before the commission is calculated.
The result is the total commission on the deal. That is the gross figure on the transaction, before it is split with any co-broker or with your brokerage. To see what you actually keep after those deductions, use the net payout calculator.
Commission value by US market
The same square footage is worth very different commissions depending on the market, because the commission tracks the rent. A 10,000 SF lease in Manhattan, where office asking rents run far above the national average, produces a much larger commission than the identical footprint in a secondary metro. The heatmap above estimates total commission value across major US markets so you can see where the dollars concentrate.
Market estimates are anchored to published average asking rents from sources such as CBRE, JLL, and Cushman & Wakefield. Asking rents are illustrative, not signed or effective rents, so treat the map as a directional comparison rather than a quote on a specific deal. What drives the rate itself, market, asset class, and deal size, is covered in the guide on typical commercial lease commission rates.
Who pays the commission, and when
In most commercial leasing deals the landlord pays the commission, even when you represented the tenant. The commission agreement names the payor and sets the schedule. The catch is timing: a leasing commission usually does not pay all at once. It commonly splits in half, with the first part triggered at lease execution and the second part triggered later, most often when the tenant takes occupancy after a build-out.
That second trigger is where brokers get stuck, because occupancy waits on tenant improvement work you do not control. The mechanics of that split are covered in the guide on the 50/50 trap, and the way TI work delays the back half is in the guide on TI allowance and commission timing. For the full payment timeline, see when commercial leasing brokers actually get paid.
Turning an earned commission into cash now
Once you know what a commission is worth, the next question is whether you want to wait months for the back half. A commission advance lets you convert an earned but unpaid commission into cash now, rather than waiting on an occupancy date set by a contractor's schedule. Cash For Commish purchases future commission payments at a flat 3⅓% discount for each month outstanding, with no underwriting or origination fees, no personal guarantee, and funding the next business day. It is not a loan; you are selling an asset, not taking on debt.
To weigh an advance against borrowing, use the advance vs loan calculator, or read the pillar guide on commission advances for commercial leasing brokers.
Frequently asked questions
How are commercial lease commissions calculated?
As a percentage of the total rent over the lease term. Multiply rentable square footage by rent per square foot to get annual rent, multiply by the number of years for total lease value, and apply the commission rate, usually a declining schedule like 6-5-4-3-3% rather than one flat rate.
What is a typical commission rate on a commercial lease?
Rates are negotiated and vary by market, asset class, and deal size, but commercial leasing commissions commonly fall in the 4% to 6% range on a declining schedule. There is no legally fixed rate.
Who pays the leasing commission?
In most commercial leases the landlord pays, even when you represented the tenant. The commission agreement names the payor and sets the payment schedule.
How does a declining commission schedule work?
The rate steps down over the term because the early years are worth more to the landlord. A 6-5-4-3-3 schedule applies 6% to year one rent, 5% to year two, and so on, then totals the result. The calculator handles this automatically when you enter year-by-year rates.
When does the commission actually get paid?
Usually in two parts: roughly half at lease execution and half at occupancy. The occupancy half can lag by months while tenant improvement work is completed. A commission advance can close that gap.
