Insight
Closing the Deal Safely: The Duties of Commercial Real Estate and Leasing Agents
09 Jun 2026
In short
Commercial property agents handle significant transactions and substantial client funds, both of which attract close regulatory and professional standards.
Commercial property agents handle significant transactions and substantial client funds, both of which attract close regulatory and professional standards. Sound documentation, careful handling of money, and transparent disclosure protect the agency, its licence and its reputation.
Agency agreements and commission entitlement
A clear agency agreement is the foundation of the relationship and the agency’s right to be paid. It should set out the appointment, whether it is exclusive, and the events that trigger commission. Disputes frequently turn on whether the agent was the “effective cause” of a sale or lease, which becomes contentious when multiple agents are involved. In several states the form and content of agency agreements are regulated — for example, under the Property and Stock Agents Act 2002 (NSW) or the Estate Agents Act 1980 (Vic) — so confirming the agreement meets the statutory requirements is worthwhile.
Licensing and trust account compliance
Agents operate under state licensing regimes and strict trust accounting rules governing client money — set out in the same property agent legislation and its regulations. Maintaining proper trust account records, reconciling regularly, and complying with audit requirements is a core compliance obligation, and trust account failures are treated seriously by regulators.
Disclosure and conflicts of interest
Agents owe disclosure duties to clients, and in commercial leasing may be involved in the landlord’s disclosure obligations under retail lease legislation. Avoiding misleading representations also engages section 18 of the Australian Consumer Law (Schedule 2 to the Competition and Consumer Act 2010 (Cth)). Managing conflicts of interest transparently supports both compliance and repeat business.
Professional indemnity and risk management
Professional indemnity insurance responds to claims of negligent advice or misrepresentation, a realistic exposure given the value of the transactions involved. Good file notes, written confirmations of advice and instructions, and clear communication reduce both the likelihood and the impact of such claims.
Privacy and marketing
Agents collect personal information from buyers, tenants and vendors, bringing obligations under the Privacy Act 1988 (Cth) and the Australian Privacy Principles. Marketing of properties and of the agency’s services also needs to be accurate and not misleading.
Practical steps you may wish to consider
- Use clear agency agreements that meet your state’s requirements and specify when commission is earned
- Maintain strict trust account compliance and staff training under the relevant property agent legislation
- Disclose material facts and manage conflicts transparently, mindful of section 18 of the ACL
- Confirm professional indemnity cover is appropriate and keep good file notes
- Meet privacy obligations and ensure marketing is accurate
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