Commercial Lease Calculator

Understanding lease costs, whether a snapshot or a deep dive, is something that many tenants (and landlords!) have trouble with doing accurately. This can be especially true with small business owners, after all, they have a business to run. Because of this, we’re introducing our commercial lease calculator, which includes NNN (Triple Net) expenses to give you a clear picture of your total costs. This tool simplifies the process, allowing those SMBs to focus on what matters most—running your business, or managing your property.

Using Our Commercial Lease Calculator

The calculator above is simple, but powerful. After including your information, the lease calculator will provide you with total monthly and annual costs.

  1. Lease Rate per Square Foot: Enter the base rental rate for your commercial space.
  2. Total Square Footage: Input the total size of the leased area in square feet.
  3. NNN (Expenses) per Sq Ft: Add the triple net expenses, which include property taxes, insurance, and maintenance fees per square foot.
  4. Lease Term (Months): Although not included in the current calculation, this can help you understand the overall duration of your commitment.

How the Calculations Work:

Total Monthly Cost: This is calculated by multiplying the Lease Rate per Square Foot by the Total Square Footage to get the base rent, and then adding the product of NNN (Expenses) per Sq Ft and Total Square Footage.

(Lease Rate per Sq Ft * Total Sq Ft) + (NNN per Sq Ft * Total Sq Ft)

Total Annual Cost: And of course, the total monthly cost is multiplied by 12 to get the annual cost. Depending on your specific fiscal year, you might need to tweak this slightly.

Total Monthly Cost * 12

FAQs

How Do Landlords Calculate Base Rent?

Landlords typically calculate base rent based on the property’s location, property valuation, market demand, and comparable rents in the area. The base rent is usually quoted per square foot annually or monthly.

What Exactly Are Triple Net (NNN) Expenses?

Triple Net (NNN) expenses are additional costs that tenants pay on top of the base rent. These typically include property taxes, property insurance, and maintenance of common areas (CAM). Understanding these costs is crucial as they can significantly affect your total lease expenses.

Why Should I Care About NNN Expenses?

Well, they’re not cheap, for one! Knowing these expenses can help you get a more complete picture of your financial obligations. These expenses can vary widely and significantly impact your monthly and annual lease costs, so it’s important to keep them at the top of mind when budgeting.

What Should I Consider When Negotiating a Lease?

When negotiating a lease, consider not only the base rental rate but also the NNN expenses. Make sure to understand what is included in these expenses and how they are calculated. It’s also beneficial to clarify how and when these costs might change over the lease term.

How Often Can NNN Expenses Change?

NNN expenses can change annually or as specified in the lease agreement. It’s important to review the lease terms and understand the frequency and potential impact of these changes on your overall lease costs.