This is the remuneration which is payable to a commercial property agent for services performed, usually arising from a disposal or acquisition transaction.
An agent appointed to identify suitable premises or dispose of an interest, will normally expect to charge about 10% of the first years rent, or in the event of a purchase/sale, between 1% – 3% of the finally agreed sale price. Both fee levels would usually be exclusive of VAT and disbursements.
A commercial property agent acting on your behalf can negotiate appropriate lease terms or freehold conditions, based on their market expertise.
They can also ensure that you only receive details of properties that are suitable for your particular requirements and they can adopt a role that prevents direct contact between the Vendor and the Purchaser.
Agents can act on a retained or non-retained basis. On a non-retained basis, the agent who introduces the property to you or identifies the purchaser, will normally expect a fee on a brokerage basis.
A retained agent on the other hand, will act exclusively on your behalf and expect a fee arising from the transaction.
There are Sole and Multiple agency contracts. The latter usually require a higher remuneration than Sole Agency contracts but marketing coverage should be more extensive.
An agent should agree and confirm the basis of their instruction, fee terms and conditions of engagement in accordance with the Estate Agents Act 1979 (as amended).