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Board amends real estate commission policy to a flat 3% and adds leasing commission
Summary
The authority replaced a tiered commission schedule with a flat 3% commission on sales, added a 3% leasing commission payable quarterly in arrears, and approved making the change retroactive to the prior month to cover a recent ground lease broker.
The Development Authority approved a staff proposal to simplify and broaden its real estate commission policy.
Alex Styles, a staff presenter, said the existing tiered commission schedule (5% up to $500,000; 3% between $500,000 and $1 million; 2% above $1 million) would be replaced by a flat 3% commission on sales. Staff also proposed and the board approved adding a leasing commission equal to 3% of the gross lease amount, to be paid quarterly in arrears; if a lease culminates in a later sale, any commission already paid for the lease would be deducted from the sale commission.
Staff asked that the policy change be applied retroactively to the prior month to accommodate a recent ground lease with a broker. Board members discussed the mechanics of arrears payments and confirmed that the change would affect a single recent lease transaction; the motion passed unanimously.
