How Much Do Commercial Brokers Charge?

The answer to this question is deceptively simple: It’s all negotiable.

But the reason behind this answer dates back to 1890 when Congress passed the Sherman Act as a way “to protect the process of competition for the benefit of consumers” (source). Essentially, the Sherman Act along with the Federal Trade Commission Act and the Clayton Act ensure healthy competition in the American marketplace and protect consumers from monopolies. For over 100 years, these laws have had to adjust to fit the changing world of business, but their goal remains the same.

Federal antitrust laws were “designed and intended to protect competition and prevent monopolies” (source). The end result of these antitrust laws is that real estate brokers can, in no way, set prices and commissions in partnership with another brokerage or broker. Doing so would violate the antitrust laws by creating standardized pricing and therefore diminishing competition.

Relationships between real estate brokers are tricky because at the same time that they are competing with each other to list properties and act on behalf of their sellers, they also must work in cooperation as they represent buyers who may view and purchase a property listed by a competing agent. Discussions or disclosures of pricing and commissions could lead, intentionally or not, to a violation of the antitrust laws.

As the client, it is in your best interest to request a proposal from the commercial real estate brokers that you are considering. Within their proposals, they will discuss their pricing and commissions which allows you to compare them to their competition.

Mathew Laborde, CCIM
Mathew Laborde, CCIM
mlaborde@elifinrealty.com
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