How are commissions paid on gross rents in office deals? If I'm charging (for example) a $30 gross rent of which $10 is expenses is the broker being paid on the $30 or just $20?

It would be calculated on the full gross amount--otherwise everyone would need to agree on projected expenses for the lease term.

Commission rates and methodologies vary by market just like rents do. Some markets are on a $/SF basis while others are on a percentage basis so that might be something to consider also.

Ask your broker what his commission will be. They will know off the top of their head.

On the $30.

In a gross rent deal the commission is calculated on the total gross rent irrespective of base year OpEx.

Even on a net deal the broker gets paid on OpEx but not escalations in OpEx. So if the expenses are $10psf and expected to escalate at 5% annually the broker still only gets paid on the $10psf expenses AND the base rent.

Thanks Finn.

I was pretty sure that was the case and that's what I had built in my model.