What is a Letter of Intent (LOI)?

Answer:  A Letter of Intent is a non-binding agreement between two or more parties who look to enter into a real estate transaction such as a lease or sale. It provides an outline of the proposed transaction, which can be negotiated before going to contract. If either party isn’t satisfied with the terms, a counteroffer can be proposed. If accepted, the LOI is revised and reviewed again by both sides. Either party can reject the deal before the final sale contract or lease is signed.

Who pays the broker's commission on a commercial lease?

Answer:  Commissions are paid in the lease transaction based on the representation of both parties:

1. After a lease is signed, the landlord and/or owner of the property usually pays a commission to the Listing Agent (or Landlord Rep) and the Tenant Rep.

2. Commission ranges may vary and can depend on the value of the transaction.

3. In terms of tenant rep situations, a tenant doesn't typically pay a commission to their rep - it is paid by the owner at the time the lease is executed unless otherwise negotiated.