BROKERS
The commercial real estate industry is an ever changing landscape, both in terms of development properties and the regulations governing the lease and acquisition of real estate. Navigating the trends in commercial real estate is eased by working with a broker. Most business executives do not negotiate leases and purchases on a regular basis, unless their business happens to be commercial real estate. With continuous development and consistently fluctuating markets, many businesses are finding it necessary to evaluate their space needs more frequently. Some executives may opt to take on these challenges without assistance, but it is very easy to get caught up in the minutiae of negotiations, which can take time and money away from running the actual business. A broker is someone who can guide a business through the process: someone who is an advisor, advocate and fiduciary partner in navigating the challenging issues associated with real estate.
All brokers are licensed by the state in which they operate (Washington State in our case). Some brokers can be licensed in more than one state, although this is uncommon. In order to maintain their licenses and continue operating, brokers must follow the rules and laws of the state in which they are licensed. Commercial real estate, as mentioned, can be quite complex – business executives need to count on the ability of a broker to provide creative solutions that address the challenges and objectives specific to each business. Since real estate decisions often have significant impact on business plans and financial statements, a good broker will focus on helping to harmonize real estate requirements within the framework of accomplishing an organization’s business goals.
Most brokers work on a commission-based fee structure – usually a percentage of the total sale or lease price or a market rate based on the size of transaction. In some instances, brokers may assess a fee for other services rendered, such as providing an opinion of value or for the recovery of marketing costs. This is usually not tied into a commission. Typically, a landlord or seller will be responsible for paying a broker’s fee. A broker cannot receive a commission unless they have been officially engaged (typically an agreement in writing) and will not get paid until a deal has been executed.
As mentioned above, there are significant financial motivations for hiring a broker. Space requirements typically make up one of the largest line-items in the financial expenditures of any business. Engaging a broker puts a business in a better position to save costs and minimize the risk associated with leasing space.
All brokers are licensed by the state in which they operate (Washington State in our case). Some brokers can be licensed in more than one state, although this is uncommon. In order to maintain their licenses and continue operating, brokers must follow the rules and laws of the state in which they are licensed. Commercial real estate, as mentioned, can be quite complex – business executives need to count on the ability of a broker to provide creative solutions that address the challenges and objectives specific to each business. Since real estate decisions often have significant impact on business plans and financial statements, a good broker will focus on helping to harmonize real estate requirements within the framework of accomplishing an organization’s business goals.
Most brokers work on a commission-based fee structure – usually a percentage of the total sale or lease price or a market rate based on the size of transaction. In some instances, brokers may assess a fee for other services rendered, such as providing an opinion of value or for the recovery of marketing costs. This is usually not tied into a commission. Typically, a landlord or seller will be responsible for paying a broker’s fee. A broker cannot receive a commission unless they have been officially engaged (typically an agreement in writing) and will not get paid until a deal has been executed.
As mentioned above, there are significant financial motivations for hiring a broker. Space requirements typically make up one of the largest line-items in the financial expenditures of any business. Engaging a broker puts a business in a better position to save costs and minimize the risk associated with leasing space.