1. An owner of an office building is currently negotiating a five-year lease with the tenant for 40,000 rentable square feet of space. The Tenant would prefer a base rent of $30 per square foot with step ups of $1 per year beginning one year from now. The owner would provide with full service under the lease terms. However the owner of the office building argues that the $30 lease is too low and should increase to $34 with the same step ups. In this case the owner will provide the Tenant with a $120,000 move-in allowance and $280,000 in in tenant improvements (TIs). 

Assume that STOB’s owner is calculating with a required rate of return of 10% per year. 

Your task as property consultant is to analyze the $34 in rents per square foot combined with a move-in allowance and TIs justified

2. Your next task as a property consultant is to calculate CAM ( Common Area Maintenance) charges for retail lesses in a shopping mall. The retail mall consist of a total area of 2,8 million sq.ft, of which 800,000 sq.ft has been leased to anchor tenants that have agreed to pay $2/sq.ft.in CAM charges. In-Line tenants occupy 1.3 million sq.ft. And the remainder is common area, which the land lord STOB will require $8/sq. f.of operating and maintenance (OE).!

If the owner is to cover total CAM charges, how much will in line- tenants have to pay square foot?

Answer rating: 100% (QA)

SOLUTION When the base plan is 34 with same setups The Incremental revenue will be 4 3430 per square ... View the full answer