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Clause for Grossing Up the Tenant Proportionate Share

New Hampshire Clause for Grossing Up the Tenant Proportionate Share

Name: New Hampshire Clause for Grossing Up the Tenant Proportionate Share
Brand: US Legal Forms
Rating: 4.79 (306 reviews)

Category:

Landlord Tenant - Commercial Leases

State:

Multi-State

Control #:

US-OL709

Format:

Instant download

Description

This office lease clause states the conditions under which the landlord can and can not furnish any particular item(s) of work or service which would constitute an expense to portions of the Building during the comparative year.

New Hampshire Clause for Grossing Up the Tenant Proportionate Share: A Detailed Description In commercial lease agreements, the New Hampshire Clause for Grossing Up the Tenant Proportionate Share is a provision that addresses the calculation and adjustment of expenses related to a tenant's proportionate share of common area maintenance (CAM) charges in a multi-tenant property. This clause ensures fairness and accuracy in distributing expenses among all tenants. The purpose of the New Hampshire Clause for Grossing Up the Tenant Proportionate Share is to account for changes in occupancy levels within the building during a given year. It ensures that the tenant's share of CAM charges is based on the actual amount of space they occupy within the property, allowing for adjustments in case of vacancies or new leases. There are two common types of New Hampshire Clauses for Grossing Up the Tenant Proportionate Share: 1. Gross-up based on square footage: This type of clause calculates the tenant's proportionate share of CAM charges by considering the leased square footage in relation to the total leasable area of the property. If there are vacancies in the property, the clause requires the landlord to "gross up" the tenant's share, meaning they adjust it to reflect the property's full occupancy level. 2. Gross-up based on occupancy: In this variant of the clause, the tenant's proportionate share is calculated based on the number of occupied units or spaces within the building. If there are vacant spaces, the tenant's share is grossed up to account for a fully occupied property. Both types of New Hampshire Clauses for Grossing Up the Tenant Proportionate Share aim to ensure that each tenant contributes their fair share of expenses, regardless of occupancy levels. By utilizing these clauses, the landlord can maintain a predictable income stream to cover property expenses and minimize the impact of vacancies on overall CAM charges. Keywords: New Hampshire Clause, Grossing Up the Tenant Proportionate Share, commercial lease agreements, common area maintenance charges, CAM charges, multi-tenant property, occupancy levels, proportionate share, gross-up, square footage, occupancy, leased square footage, total leasable area, vacancies, fair share, predictable income stream.

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Gross-ups are also practical for tenants. A prime example is a lease with a base year or expense stop. If a tenant negotiates a base year, then, in most cases, the tenant will pay its share each year of the operating expenses which exceed the base year's expenses.

Correctly drafted, a gross up provision relates only to Operating Expenses that ?vary with occupancy??so called ?variable? expenses. Variable expenses are those expenses that will go up or down depending on the number of tenants in the Building, such as utilities, trash removal, management fees and janitorial services.

Many commercial leases, especially office leases, include a provision that allows landlords to ?gross up? operating expenses. That is, if the building is not fully occupied, the landlord is empowered to gross up or overstate the expenses as if the building is fully occupied (or nearly full).

It is a contract between a landlord and tenant, wherein the lessee, in exchange for the exclusive use of a piece of property, agrees to pay the lessor a fixed sum of money for a certain period of time that encompasses rent and all costs associated with ownership, such as taxes, insurance, and utilities.

So, what is a gross-up provision? Simply stated, the concept of ?gross up provision? stipulates that if a building has significant vacancy, the landlord can estimate what the variable operating expense would have been had the building been fully occupied, and charge the tenants their pro-rata share of that cost.

Also known as tenant's pro rata share. The portion of a building occupied by the tenant expressed as a percentage. When a tenant is responsible for paying its proportionate share of the landlord's costs for the building, such as operating expenses and real estate taxes, the tenant pays this amount over a base year.

Grossing Up is a process for calculating a tenant's share of a building's variable operating expenses, where the expenses are increased for expense recovery purposes, or Grossed Up, to what they would be if the building's occupancy remained at a specific level, typically 95%- 100%.

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How to fill out Clause For Grossing Up The Tenant Proportionate Share? When it comes to drafting a legal document, it's better to leave it to the professionals. In other words, the lease allocates a certain amount to each tenant based on that tenant's proportionate share of the area within the building. Many ...Sep 26, 2019 — $100.00, then each of the four (4) tenants would be charged for their proportionate (25%) share of the CAM expenses—i.e., $25.00 each. May 19, 2022 — If the building has five different tenants, each occupying one floor, each tenant's proportionate share would be 10% (1/10 of the total building) ... If each of the five tenants pays its 10% proportionate share of the “grossed-up” operating expense amount of $50,000, they would each pay $5,000, and the ... footage and/or limited services for the Tenant's use, a proportionate abatement of the rent shall be made. 17.2 Tenant's Remedies: In the event the Premises ... The intention of this manual is to provide to the reader an approachable, reference tool geared to assist with the inherently complex task of property tax ... Aug 9, 2023 — In triple net office leases, tenants are required to reimburse landlords for a portion of the building's overall operating expenses. Discover how the Gross Up Provision in a commercial lease is designed to protect landlords and remain fair to tenants, how it's calculated, and more. Aug 18, 2020 — This results from the fact that each tenant's proportionate share is the ratio of the tenant's space to the total space in the building rather ...

New Hampshire Clause for Grossing Up the Tenant Proportionate Share

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How to fill out New Hampshire Clause For Grossing Up The Tenant Proportionate Share?

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Do you gross up a base year?

What expenses can be grossed up?

What is occupancy gross up adjustment?

What is the gross lease clause?

What is the gross up clause on a lease?

What is the tenant's proportionate share?

What is a 95% gross up mean?

Interesting Questions

What is Clause for Grossing Up the Tenant Proportionate Share in a lease agreement?

Why is the Grossing Up clause included in a lease agreement?

How does the Grossing Up clause work?

What expenses are typically included in the Tenant Proportionate Share?

Can the landlord unilaterally modify the Grossing Up clause?

What happens if the actual expenses fall below the baseline set in the Grossing Up clause?

Are there any limits or restrictions on adjusting the Tenant Proportionate Share?

Can the tenant negotiate the terms of the Grossing Up clause?

How often are the tenant's proportionate share and expenses adjusted according to the Grossing Up clause?

What should the tenant consider before agreeing to the Grossing Up clause?

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