|
 Why
have one? At the simplest level an exclusive brokerage relationship is
akin to securing a business skill from an outside source in order to accomplish
a particular task. It is like obtaining the services of a temporary professional
without having to pay wages, taxes or benefits. The only price is loyalty.
Having an exclusive agent insures that all of the many details of leasing
and selling property are attended to. There are many traps and pitfalls
in the selling and leasing process. There is a lot more to it than driving
around with a cell phone and calling on signs. Documentation is critical
and a good broker will create documents that accomplish the task with
accuracy as well as appear as they were professionally prepared. One of
the most important intangible assets a broker brings to a project is the
quality of his business relationships. There are certain brokers with
whom landlords and cooperating brokers like to deal and there are others
whom they would rather avoid. A broker who does not have a solid history
of delivering his side of the bargain will have a very difficult time
in securing product for his client in the current market climate.
Who pays? In leasing landlords pay brokers for the rental income stream
tenants bring to the building. In San Francisco most commercial real estate
fees are paid as a function of the amount of square feet leased and the
lease term. In case you are wondering, in most instances, the tenant's
broker does not have an incentive to keep the rental rates higher in order
to earn a higher commission. The landlord's broker may have other fish
to fry, but not the tenant's broker. No matter what the rent level, the
tenant's broker is usually paid the same. | 
