A commercial property manager is responsible for operating a shopping center. The manager must prepare an annual operating budget, negotiate vendor contracts, and handle tenant relations. In addition to management fees, the owner authorizes the manager to earn a leasing commission for each new tenant the manager brings in. Is this compensation structure permissible?
Correct Answer
D) Yes, as long as the compensation structure is disclosed to and authorized by the property owner in the management agreement
A property manager may earn both a management fee and leasing commissions if the compensation structure is clearly disclosed to and authorized by the property owner in the management agreement. Transparency and owner consent are key.
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