What is leakage in commercial real estate?
If the landlord or owner underestimates operating costs or there are unexpected major building repairs that occur in a year, the landlord may experience what is referred to non-reimbursable expenses (sometimes called “leakage”) which could negatively impact the return on the property’s investment.
What is the definition of base rent?
What is Base Rent? In a triple net or percentage lease, the base rent is the set rental rate that you will pay the landlord, before any additional operating expenses or revenue percentages each month.
What does PG mean in commercial real estate?
Paying guest accommodation services are generally offered by families for rent to share their property and serve as an additional source of income for landlords. PG is considered one of the most affordable accommodations who love to save some money and cannot afford an entire apartment for rent.
What is retail leasing?
A retail lease is a legal document outlining the terms under which one party agrees to rent property from another party. … Both the lessee and the lessor must uphold the terms of the contract for the lease to remain valid.
Who pays for roof repairs in triple net lease?
The triple net lease requires the owner to shoulder the cost of structural repairs. That responsibility makes it essential that the lease defines the projects that will be considered maintenance versus structural repairs. One can make an argument that replacing a roof is a repair or a capital expenditure.
What does tt mean in commercial real estate?
REI – real estate investing. REO – real estate owned. ROI – return on investment. TT – transfer tax.
What is monthly base rent?
Base rent usually refers to the stated monthly rental rate in a commercial lease. Base rent also sometimes is called net rent or minimum rent. Base rent may be the same throughout the lease term, or the lease may provide for annual increases in base rent.
How do you calculate base rent?
To determine the annual base rent (annual fixed rent or annual minimum rent); the landlord multiplies the total square footage (rentable square feet) by the square foot rate.
What is the difference between base rent and additional rent?
The Basic Rent is the landlord’s Net Operating Income and the Additional Rent is the rent charged to cover off all Operating Costs for the property.
What is a good guy clause in a commercial lease?
Here’s how it works. If you’re a tenant and your business fails, but you vacate your space and pay rent through the date you vacate, you’re a “good guy.” A good guy clause limits the liability of the personal guarantor for a tenant when a lease is terminated early.
Should I personally guarantee a commercial lease?
Business owners are often required to give a personal guarantee to get a business loan or to lease commercial space for their business. Most business advisors say you should keep business and personal financial matters separate, and the loan is for the business, not for the individual.
What does PCG mean in real estate?
PCG means price change. Properties marked BOM have come back on the market after the active marketing has been suspended by being UAG, WDN, CAN, or EXP.