What formula is used to calculate leasing commissions in Argus Enterprise?

The formula used to calculate leasing commissions in Argus Enterprise is based on a combination of fixed base amounts, adjustments for steps in the lease, and the Consumer Price Index (CPI), all multiplied by a Leasing Commission Percentage.

The reasoning for using the sum of these components lies in the need to accurately reflect the total potential income that the leasing agent would be generating through leasing activities. The "Base" represents the starting level of rent, while the "Step" takes into account any scheduled increases in rent over time as part of the lease agreement. The CPI is included to account for inflation and changes in economic conditions that could affect lease values.

By multiplying the sum of these amounts by the Leasing Commission Percentage, the resulting figure provides a precise measure of the commission owed to the leasing agent based on the total expected rental income over the lease term. This method ensures that all relevant factors impacting the commission calculation are considered, leading to a fair and adequate compensation for the services rendered in securing leases.

In terms of the other options, they misalign the components and operations needed to produce an accurate commission calculation. For instance, subtracting components or misplacing the multiplication and division operations does not reflect the intended structure of leasing agreements and their financial implications.