You’ve spent weeks searching for commercial space and finally found the right location for your growing business. Before signing a lease, know that the advertised rent per square foot is rarely the final number. Commercial lease costs can include load factors, operating expenses, and annual rent increases, all of which affect what you’ll actually pay each month.<\/p>\n
What You Will Learn<\/span><\/p>\n
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- Distinguishing between Usable<\/strong> and Rentable<\/strong> square footage.<\/li>\n
- The “Four Types” of commercial leases: NNN, MG, FSG, and Percentage.<\/li>\n
- A step-by-step formula to calculate your actual monthly check.<\/li>\n
- Key negotiation levers to protect your bottom line.<\/li>\n<\/ul>\n<\/blockquote>\n
3 Important Lease Terms to Understand<\/strong><\/h2>\n
Most businesses lease a space within a multi-tenant property. Therefore, understanding these three terms is the first step in an accurate calculation:<\/p>\n
#1 Rentable Square Feet (RSF)<\/h3>\n
This is the total amount of space a landlord can charge rent on. It represents your usable square footage plus a proportional share of the building’s common areas, including lobbies, shared hallways, and public restrooms. Most landlords calculate rentable square footage using standards set by BOMA <\/a>(Building Owners and Managers Association International), whose latest guidelines allow landlords to include certain ground-level outdoor areas in the calculation, which can raise load factors in newer buildings.<\/p>\n