How to Estimate Taxes and Insurance Premiums Where Lease Calls for Net Rental. As it will be impossible to correctly judge what the future taxes and insurance premiums will be during the term of a lease, the amount of the taxes last paid, or to be paid (if possible of being ascertained) on the property, shall be used as a basis for computation. As such leases obviously state the amount of fire insurance to be carried on the property at the expense of the Lessee, and an approximate insurance rate, contemplating the tenant in possession, can easily be obtained from the Underwriters as to the insurance rate at the time the lease is made, the same shall be used as a basis for computation.
Rule 6. When Lease Contains Privilege of Renewal. When the lease gives the Lessee a privilege of renewal, the charge shall be made for the actual term of the lease. If the Lessee later avails himself of the privilege of renewal, whether strictly according to the terms expressed in the lease or not, the agent shall also be entitled to a commission on the extended period. This additional commission shall be the difference between the amount of commission due for the entire term, including the extended period, and the amount of commission previously paid. The additional commission shall be paid the agent at the time of renewal.
Rule 7. Where Renewal of Lease is Negotiated by Agent. Where renewals of leases are negotiated and the agent does not collect the rent, he shall charge the regular rates prescribed in this Section, the same as if the leases were negotiated with new tenants.
Rule 8. Minimum Charge for Leasing Residence Property. The minimum charge to be made in any case for leasing residence property shall be Ten Dollars ($10).
Rule 9. Where Lease Contains Option to Purchase. Should there be a clause in the lease giving the Lessee an option to purchase the property demised, whether or not the purchase is made exactly .on the terms stipulated in the lease, the owner shall pay the agent who negotiated the lease two and one-half per cent. (2½%) on the purchase price, to be paid when the sale is closed. (See Rule 35.)
(b) By-laws. Section II.
Charges for negotiating leases which contemplate the erection of new buildings.
Rule 10. Where Lease Contemplates Erection of New Building. The charge for negotiating leases which contemplate the erection of a building for a tenant, shall be two and one-half per cent. (2½%) on the value of the land as calculated in the making of the lease, and two and one-half per cent. (2½%) on the cost of the proposed building and appurtenances.
Charges for procuring tenants under the conditions mentioned in the foregoing Sections 1 and 2 are to be made at the rates stipulated, unless there shall have been a previous agreement between the owner and the agent for the collection of rent.
(c) By-laws. Section III.
Charges for management of property where agent collects the rent, makes leases, repairs, etc.
Rule 11. Charges for Store, Loft, Office, Residence or Other Property. For renting and collecting rents regardless of the character, use or location of the property, charge five per cent. (5%) on collections, unless special or extraordinary services are required, when an additional charge may be made which will be commensurate with the service rendered.
Rule 12. For office and residence property, wherever located, charge five per cent. (5%) on collections.
Rule 13. Charge on Disbursements. In the management of property under this Section the agent shall be entitled to charge on disbursements as follows, to wit: On amounts paid out for taxes on improved property, one per cent. (1%) and on unimproved property two and one-half per cent. (2½%), no charge to be less than One Dollar ($1). Members shall have the right to charge for special services not contemplated under ordinary agency.
Rule 14. For negotiating new leases and for the renewals of old leases the charge shall be in accordance with the circumstances and services performed, and shall be in addition to the amount expended for advertising.
Rule 15. When Collection of Rents is Withdrawn. Where the collection of rents on property is withdrawn from an agent, such agent shall be entitled to charge for the unexpired term of any leases he may have made or renewed during his agency, at the rates specified in Section 1 hereof.
Rule 16. Agents May Take Management on Other Basis. Agents may take the management of buildings and charge the regular Board rates for making new leases as prescribed in Sections 1 and 2 hereof, and in their discretion reduce the charge hereinbefore provided in this Section for renting and collecting. This policy is recommended to members for the reason that it places them in position to pay commissions to other brokers who may assist them in making leases.
Rule 17. For the Transfer or Assignment of Leases. For transferring or assigning leases the charge shall be in proportion to the service rendered, but in no event shall same be less than Five Dollars ($5) for leases on residence property and Fifteen Dollars ($15) for leases on business property.
Form 6. - Charges for Ground Leases. Chicago, Illinois.
By-laws. Section IV.
The following charges shall be made for ground leases, whether the agent is managing and collecting rents on the property at the time of making lease or not.
Rule 18. Where the Term is Seven Years or Less. For making an original lease, or a sub-lease thereof, where the term of lease is seven (7) years or less, charge in accordance with Section 1 of this Article.
Rule 19. Where the Term is Over 7 and Does Not Exceed 15 Years. For making an original lease, or a sub-lease thereof, where the term of lease is over seven (7) and does not exceed fifteen (15) years, charge on the total rent for the term two per cent. (2%).
Rule 20. Where Term Exceeds 15 Years. For making an original lease, or a sub-lease thereof, where the term of lease exceeds fifteen (15) years, charge on the value of the ground as determined by capitalizing the annual ground rental on a four per cent. (4%) basis, two and one-half per cent. (2½%).