What is base rent in a commercial lease?

Rent is the fee a tenant pays the owner of the property to use the area. The form of the lease agreement and any additional fees are typically agreed upon by both property owners and tenants. Let me guide you more about what is base rent in commercial lease in this answer.

What is the base rent in a commercial lease?

Assume the usable space is 90 square feet, and the shared space is 40 square feet. If the monthly rent for the usable area is Rs 140 and the monthly fee for the shared area is Rs 50 per sq ft. As a result, the monthly commercial rent will be as follows:

You can use the basic formula below to determine commercial rent: 

Rent = Available Square Feet x Available Square Feet Rate Per Month + (Common area x the rates per month for this type of area).

Each month, (90 x 140) + (40 x 40) = Rs 14,200 will be the base commercial rent.

Some tenants choose to finish the rental process on their own, while others would rather deal with developers or landlords and pay an extra rental cost. Rs 900 - 1,000 per square foot is the additional cost. Builders or landlords can add Rs 25 - 30 per square foot each month to cover these costs. Location, leasable and usable space, contract or lease type, market rates and trends, as well as how the property is furnished and prepared, all have an impact on rent rates.

What is the commercial lease minimum term?

A commercial lease can often last between 3 and 8 years. A lease with a basic rent typically contains an increase clause for taxes and running costs, and occasionally a percentage rent term as well, based on the details of the lease agreement.

The cost of a rental is also influenced by the lease arrangement. The majority of commercial leases are composed of 5+5+5 or even 3+3+3 agreements. Rent increases are restricted to happening every 3 or 5 years. Market trends, infrastructure upgrades, the accessibility of public transportation and social amenities have long-term effects on rentals and property values.

What is base rent in a commercial lease must be clear to you now.