Commercial agent charges 5.5% fee to manage property

Hi all

I have a very small cheap factory and this is the only property that I use a commercial agent to manage, I manage all of my other properties myself which are retail premises.

Anyway what has caught my attention is the 5.5% on-going management fee is not just on the rental amount but also on the collection of other things like OC fees and Council Rates that the tenant is responsible for.

So if my property has a $1,000 council rates invoice that the tenant needs to pay, my agent will make 5.5% on the collection of this cost from the tenant and I don't get the full costs reimbursed as I will only receive $945 plus the GST of course.

To those in the know is this standard and normal practice?

Imagine I had a $10,000 council rates notice that my tenant had to pay, that 5.5% loss would be a huge amount.

Regards,

alicudi

 

It's starting to become a trend even in residential property

 

Not normal, check MAA for all monies vs rent collected

 

@alicudi - rates are variable/negotiable.
Yes, typical for the agent to take % on all rent collected (and bills reimbursed) - this would be no different to the agent managing a gross lease where outgoings are included.
See if you can use a solicitor's lease rather than the agent's lease - if it is a net lease include a term for payment of agency fees as well