- January 31, 2019 at 2:20 pm #745
I understand that the current model does not allow you to detail out specifics of expense recovery (such as base year). How would you tackle using the percentages of pro-rate share for a base year lease?
- February 19, 2019 at 7:32 pm #755
Sorry for the delayed response here – February has been a very busy month for me!
Modeling leases with a base stop lacks precision with the All-in-One. Nonetheless, you can approach a decent approximation using columsn AG:AU of the ORI-RR tab.
To model a Base Year stop. First, set the expense reimbursement ‘Detail’ to ‘Yes’ in column AG. Adjust the ‘Pro Rata Share of OpEx’ in column AH if necessary. Then in columns AK:AU, approximate what percentage of the reimbursable operating expenses the tenant would likely reimburse in each year. If the tenant begins it’s lease in year 1 and the expense stop is a base year stop, the reimb % in year 1 would be 0%. Then, if operating expenses are set to grow at 2% per year (on the ORI-OpSt tab), then set year 2 to 2%, year 3 to 4%, year 4 to 6%, and so forth.
For 1st generation tenants, you can get a pretty close approximation. 2nd generation tenants become more problematic, and so my recommendation is to set future generation tenants to NNN (i.e. 100% Reimb. %) and adjust the market rent accordingly.
Hope this (belated) response is helpful!
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