Practice: Chapter 16 • Alternate Real Estate Careers

Front 1

A rent survey must then be conducted to determine the property’s income and how close it compares to current market __ rates in the area at that time.

Back 1

rental

Front 2

Certified Commercial Investment __ (CCIM) is very comprehensive.

Back 2

Member

Front 3

CPM, or Certified Property Manager, offered through the Institute of Real Estate __.

Back 3

Management

Front 4

RLI designation offered through the REALTORS® Land Institute
for licensees who wish to specialize in __ brokerage.

Back 4

land

Front 5

The two ways to enter commercial real estate are:
1. Work for a large commercial real estate firm.
2. Work as a residential licensee while taking courses, learning the commercial __.

Back 5

business

Front 6

An Accredited Management Organization (__) designation
is given by IREM to a company that meets the following
standards:
• At least one CPM in charge
• Annual accreditation renewal
• Adherence to minimum standards and the rules set by IREM
• Property management as a primary activity

Back 6

AMO

Front 7

Virtually all property management firms work under a
management __, whereby the firm is empowered with
specific duties and obligations on behalf of the property owner.

Back 7

agreement

Front 8

Resident Manager. A resident manager lives on the __.

Back 8

premises

Front 9

The objective of good property management is to achieve a level of
rent and vacancy that provides the highest net return to the property __.

Back 9

owner

Front 10

A trust account __ (book keeping) for all property management
accounts must be established.

Back 10

ledger

Front 11

Estate at sufferance is created when a tenant obtains possession
of a property legally but remains on the property without the owner’s
consent after the expiration of the tenant’s leasehold interest.
A tenant at sufferance can be removed like a __.

Back 11

trespasser

Front 12

Estate at will has no set time limit. Possession is given with permission,
but no agreement is made with respect to rent. Requires 30 days to __.

Back 12

evict

Front 13

When tenants pay a fixed amount, its a __ lease. Most are this kind.

Back 13

gross

Front 14

In a triple-net or NNN
lease, the utilities, real estate taxes, repairs and maintenance, and
other special assessments are the tenant’s __.

Back 14

responsibility

Front 15

In a
double-net or NN lease, the tenant and owner each pay certain
operating __.

Back 15

expenses

Front 16

A percentage lease generally provides for a stated __ of
the gross receipts of a business to be paid as rent. May contain a recapture clause, which provides
that, if a tenant does not attain a desired gross, the lessor has
the right to terminate the lease.

Back 16

percentage

Front 17

Most business owners to want their corporation to be the __ in the lease.

Back 17

tenant

Front 18

To be valid, a lease must:
• Contain the names of the lessor and lessee and be signed by
both parties.
• Be in writing if for longer than one year (statute of frauds).
Leases for one year or less need not be in writing.
• Show the amount of rent and manner of payment.
• State the duration of time the lease is to be in force.
• Contain an adequate description of the demised property.
• Be between parties who are capable of contracting.
• Show any automatic renewal provisions in __ type.

Back 18

boldface

Front 19

Its wise to always use a WRITTEN lease. Don’t try to draft a lease or use a “cut-and-paste” method
of assembling a lease as this may create errors and omissions
that would probably be considered the __ practice of law.

Back 19

unlawful

Front 20

Security deposit: up to 2 mos rent for unfurnished, 3 mos for __.

Back 20

furnished

Front 21

Commercial real estate __ should always start with a rent
survey to evaluate a property’s current rental income with pro
forma rents that may be available.

Back 21

valuation

Front 22

A trust account is necessary in a
property __ company and great care must be used to
keep it current and accurate.

Back 22

management

Front 23

2. Which of the following is true about
going to work for a large commercial
real estate brokerage firm?
A. It gives you more credibility with
your commercial clients.
B. It requires a large savings
account or other source of
income.
C. It usually provides better training
than a residential company
would offer.
D. All of the above.

Back 23

D. All of the above.

Front 24

4. Which of the following businesses
would likely pay the highest percentage
on a percentage lease?
A. National chain drug store
B. Men’s clothing store
C. Parking lot
D. Restaurant

Back 24

C. Parking lot

Front 25

5. A percentage lease contains which
of the following?
A. A minimum rental rate.
B. An annual CPI increase clause.
C. A covenant to remain in business
clause.
D. A and C.

Back 25

D. A and C.

Front 26

6. Which of the following businesses is
likely to pay the lowest percentage
on a percentage lease?
A. Tobacco shop
B. Music store
C. Real estate office
D. Supermarket

Back 26

D. Supermarket

Front 27

Commonly, leases in these percentage lease shopping centers
have a clause that states that if the anchor tenant or shadow
anchor tenant in a retail center immediately adjacent to a center
vacates, the other tenants in or immediately adjacent to the “vacated”
center are or, under certain conditions, may be entitled to a rent
__.

Back 27

abatement

Front 28

7. Which is an untrue statement
concerning security deposits?
A. Nonrefundable cleaning deposits
are allowed if stated in bold print.
B. Deposits for unfurnished rentals
cannot exceed threemonths’ rent.
C. Waterbed insurance is not allowed
to be mandatory by a landlord.
D. All of the above.

Back 28

D. All of the above.

Front 29

8. An unlicensed assistant can do
which of the following activities?
A. Call the licensee’s sellers and give
them Open House results and
recommend a price change based
on the results.
B. Telephone prospect for the
licensee.
C. Draft an addendum for the
licensee and have the buyers
sign it.
D. None of the above.

Back 29

D. None of the above.