A Tenant Has a Gross Lease with an ''Expense Stop''of $\rightarrow$

question 9

Multiple Choice

A tenant has a gross lease with an ''expense stop''of $2.75/SF. If the building has 200,000 square feet of leasable space, reimbursable operating expenses of $750,000, and the tenant rents 25,000 SF, then how much does the tenant owe the landlord in expense reimbursements (the total $ amount) ?

• A) $3.75/SF.
• B) $25,000. : $750,000 / 200,000SF \(\rightarrow\) Total OE/SF = $3.50. Less $2.50 stop \(\rightarrow\) Tenant owes $1.00/SF * 25k SF.
• C) $68,750.
• D) $93,750.
• E) Can't answer because it depends on the CPI adjustment in the lease.

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Definitions:

Implications

The possible effects or consequences of an action or decision, often considered in the context of planning or analysis.

Interest Rate

A charge, represented as a percentage of the principal, assessed by a lender for allowing a borrower to use their resources.

Future Value

The value of a current asset at a specified date in the future based on assumed growth rates or interest rates.

Interest Rate

The part of a loan that attracts interest charges for the borrower, customarily expressed as a yearly percentage of the loan's unpaid balance.