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Commercial Real Estate Agent vs Broker vs Realtor: Understanding the Differences

CEO Khai Intela
Image Source: Saigon Intela When it comes to commercial real estate, terms like agent, broker, and realtor are often used interchangeably. But did you know that each position has its own unique responsibilities, qualifications, and...

Commercial Real Estate Agent vs Broker vs Realtor Image Source: Saigon Intela

When it comes to commercial real estate, terms like agent, broker, and realtor are often used interchangeably. But did you know that each position has its own unique responsibilities, qualifications, and expertise? Understanding the differences between a commercial real estate agent, broker, and realtor can help you make informed decisions when it comes to buying or selling commercial properties.

What's the Difference?

In simple terms:

  • A commercial real estate agent is a licensed professional who helps clients buy or sell real estate. They are paid a commission upon completion of the transaction.
  • A commercial real estate broker does everything an agent does but has a license to work independently and may hire agents to work under them. They collect a percentage of their agents' commissions.
  • A commercial realtor is an agent, broker, or other real estate professional who is a member of the National Association of REALTORS® (NAR). It is a professional membership, not a job title.

The Role of a Commercial Real Estate Agent

A commercial real estate agent works with clients to buy, lease, rent, or sell commercial properties. They act as intermediaries in the real estate process, providing guidance based on data analysis and industry knowledge.

What Do Commercial Real Estate Agents Do?

To become a licensed commercial real estate agent, one must complete a course of study, pass state-regulated exams, and work under a commercial broker or a commercial real estate company. They cannot work independently.

Commercial agents receive a commission for assisting their clients in buying or selling a property. They facilitate communication between buyers and sellers, make offers and counteroffers, handle paperwork, and inform clients of additional steps required for the deal to finalize. They play a vital role in ensuring a smooth transaction and ultimately handing over the keys to the new property owners.

Commercial real estate agents can also fill two roles: listing agents and buyer's agents. While it's considered a conflict of interest for an agent to act as both for one transaction, some states allow it. Listing agents represent the property seller, while buyer's agents help clients find and purchase commercial properties.

Understanding the Role of a Commercial Broker

A commercial real estate broker assists clients with buying, leasing, renting, or selling commercial properties. They act as intermediaries, just like agents, but with additional responsibilities.

What Does a Commercial Broker Do?

A commercial broker can do everything a commercial real estate agent does but is also licensed to employ agents and collect a percentage of their commissions. They may work as associate brokers, managing brokers, or principal/designated brokers.

Associate brokers work at existing commercial brokerage firms to gain experience or for convenience. Managing brokers oversee the day-to-day aspects of other brokers and agents in a commercial brokerage firm. Principal/designated brokers ensure compliance with state and federal laws.

Commercial brokers receive commissions from the sales their agents produce and can decide how involved they want to be in the overall deal.

The Role of a Commercial Realtor

A commercial realtor is a professional membership, not a job title. To become a realtor, a commercial real estate agent or broker must belong to the National Association of REALTORS® (NAR). The NAR is the most prominent trade organization in the United States, with over 1.5 million members.

How to Become a Commercial Realtor?

To become a commercial realtor, one must pass an application process, pay monthly duties and fees, and adhere to the NAR Code of Ethics. This code includes ethical standards, obligations to clients and customers, duties to the public, and duties to fellow realtors.

While the process to become a commercial realtor may be rigorous, there are significant benefits, including a prestigious designation, networking opportunities, access to commercial MLS, and exclusive resources.

Conclusion

When it comes to commercial real estate, understanding the differences between agents, brokers, and realtors is crucial. Each role has its own responsibilities and qualifications, and knowing these distinctions can help you make informed decisions in the industry. Whether you're buying, selling, or investing in commercial properties, partnering with the right professional is key to your success.

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