This office lease clause should be used in an expense stop, stipulated base or office net lease. When the building is not at least 95% occupied during all or a portion of any lease year, the landlord shall make an appropriate adjustment for each lease year to determine what the building operating costs. Such an adjustment shall be made by the landlord increasing the variable components of such variable costs included in the building operating costs which vary based on the level of occupancy of the building.
The Indiana Gross Up Clause is a provision commonly used in Expense Stop Stipulated Base or Office Net Leases. It serves as a mechanism to fairly distribute the expenses related to operating and maintaining a commercial property among its tenants. In essence, the clause allows for an adjustment or "gross up" of the expenses in case the property is not fully leased. The primary purpose of the Indiana Gross Up Clause is to ensure that tenants are not burdened with paying higher expenses due to the property's low occupancy. By grossing up the expenses, the landlord aims to distribute the operating costs as if the property was fully occupied, thus preventing any undue financial burden on the current tenants. There are different types of Indiana Gross Up Clauses that can be used in an Expense Stop Stipulated Base or Office Net Lease: 1. Full Gross-Up Clause: This type of clause ensures that the expenses are proportionally allocated as if the property was fully occupied. It takes into consideration the vacant space while distributing the costs among the tenants. 2. Partial Gross-Up Clause: In this scenario, the expenses are grossed up partially. The extent to which the expenses are adjusted depends on the level of occupancy in the property. For example, if the property is 80% occupied, the expenses would be grossed up by 20% so that each tenant shares the expenses equally. 3. No Gross-Up Clause: Some leases may not include a gross-up provision at all. In this case, the expenses are allocated based on the actual occupancy level of the property. Tenants will bear the expenses related to their rented space without any adjustment for vacant areas. It is essential for tenants and landlords in Indiana to carefully review and negotiate the gross-up clause when entering into an Expense Stop Stipulated Base or Office Net Lease. The specific terms and conditions of the gross-up provision can significantly impact the financial obligations of both parties. In conclusion, the Indiana Gross Up Clause in an Expense Stop Stipulated Base or Office Net Lease is a crucial component for fairly distributing operating expenses. Understanding the different types of gross-up clauses and their implications is essential for both tenants and landlords involved in commercial leasing agreements.
The Indiana Gross Up Clause is a provision commonly used in Expense Stop Stipulated Base or Office Net Leases. It serves as a mechanism to fairly distribute the expenses related to operating and maintaining a commercial property among its tenants. In essence, the clause allows for an adjustment or "gross up" of the expenses in case the property is not fully leased. The primary purpose of the Indiana Gross Up Clause is to ensure that tenants are not burdened with paying higher expenses due to the property's low occupancy. By grossing up the expenses, the landlord aims to distribute the operating costs as if the property was fully occupied, thus preventing any undue financial burden on the current tenants. There are different types of Indiana Gross Up Clauses that can be used in an Expense Stop Stipulated Base or Office Net Lease: 1. Full Gross-Up Clause: This type of clause ensures that the expenses are proportionally allocated as if the property was fully occupied. It takes into consideration the vacant space while distributing the costs among the tenants. 2. Partial Gross-Up Clause: In this scenario, the expenses are grossed up partially. The extent to which the expenses are adjusted depends on the level of occupancy in the property. For example, if the property is 80% occupied, the expenses would be grossed up by 20% so that each tenant shares the expenses equally. 3. No Gross-Up Clause: Some leases may not include a gross-up provision at all. In this case, the expenses are allocated based on the actual occupancy level of the property. Tenants will bear the expenses related to their rented space without any adjustment for vacant areas. It is essential for tenants and landlords in Indiana to carefully review and negotiate the gross-up clause when entering into an Expense Stop Stipulated Base or Office Net Lease. The specific terms and conditions of the gross-up provision can significantly impact the financial obligations of both parties. In conclusion, the Indiana Gross Up Clause in an Expense Stop Stipulated Base or Office Net Lease is a crucial component for fairly distributing operating expenses. Understanding the different types of gross-up clauses and their implications is essential for both tenants and landlords involved in commercial leasing agreements.
