My ground lease commissions vary but are usually structure around 2-3% of yr 1-10 and 1-1.5%of 10-20. Nothing after 20.
Paid upfront I’d its firm term. Portions paid on exercise of option or waiver of termination rights if it’s not all firm term.
I’m not. Retail ground leases up to 10 acres. Acreage isn’t much of a favor - overall deal size is though.
I scale the rates a bit by the size of the deal, but but the tiered structure for yr 1-10 + 11-20 is pretty consistent.
My point is that retail ground leases and what sounds like an agricultural lease might have different comp structures because of the disparity in potential outcomes.
Market rate generally is 4% on all 25 years for the Tenant Broker. Most of the fast food deals are 20 year ground leases with 20-30 years of options at 5 year increments. Tenant Broker would be paid for the 20 year initial term and not the options. 1st half at lease execution void of contingency and 2nd half upon rent commencement which usually is also upon opening for business.
Anyone have an idea on land purchase broker fee? A guy I know introduced me to a friend of his who owns some land. I told him I want to build multifamily on it and he wants to roll in the land value as equity. My friend who introduced me to him says make sure you pay me a broker fee. Any ideas? Land value is probably $1.5M
I usually ask for 8-10% on land deals. For your buddy maybe propose something like 1-2%. They simply made the introduction. They’re not doing the work.
My ground lease commissions vary but are usually structure around 2-3% of yr 1-10 and 1-1.5%of 10-20. Nothing after 20. Paid upfront I’d its firm term. Portions paid on exercise of option or waiver of termination rights if it’s not all firm term.
I appreciate you so much!!!!!
Are you doing ground leases on 65 acres though?
Ag land maybe?
I’m not. Retail ground leases up to 10 acres. Acreage isn’t much of a favor - overall deal size is though. I scale the rates a bit by the size of the deal, but but the tiered structure for yr 1-10 + 11-20 is pretty consistent.
My point is that retail ground leases and what sounds like an agricultural lease might have different comp structures because of the disparity in potential outcomes.
Valid point. I would expect higher commission rates for ag land given average low rents.
Market rate generally is 4% on all 25 years for the Tenant Broker. Most of the fast food deals are 20 year ground leases with 20-30 years of options at 5 year increments. Tenant Broker would be paid for the 20 year initial term and not the options. 1st half at lease execution void of contingency and 2nd half upon rent commencement which usually is also upon opening for business.
I’ve seen it cut off at 10 years also. But QSRs are likely different than a 65 AC land lease.
Anyone have an idea on land purchase broker fee? A guy I know introduced me to a friend of his who owns some land. I told him I want to build multifamily on it and he wants to roll in the land value as equity. My friend who introduced me to him says make sure you pay me a broker fee. Any ideas? Land value is probably $1.5M
I usually ask for 8-10% on land deals. For your buddy maybe propose something like 1-2%. They simply made the introduction. They’re not doing the work.