Exam 22: Managing Non-Residential Rental Property

Given the following information,calculate the effective monthly rent payment.Lease Term: 10 years,Concession: 1 year free rent to be spread over the term of the lease,Rental Space: 5000 square feet,Rental Rate: $20 per square foot per year,Landlord's discount rate: 10%.

Newer industrial parks have begun to specialize in providing space that can be configured to suit the diverse needs of various tenants.This type of industrial space is more commonly referred to as:

The choice of which method to use in constructing the contracted rental rate can be impacted by the term of the lease.With a shorter lease term,which of the following methods is most likely to be observed?

As with any valid contract,enforceable leases must meet a number of requirements.One of these requirements is for each party to provide appropriate consideration.In a lease,which of the following constitutes the landlord's consideration?

The rental income generated by a lease can depend significantly on the proportion of property-level operating expenses paid by the tenant.In which of the following types of leases is the tenant responsible for all operating expenses?

The effective rent calculation is a common measure used to compare the true cost of one lease to another.While there are a number of limitations to this methodology,the effective rent calculation captures:

Retail establishments are found in a variety of forms,the simplest of which is: (Hint: fast-food franchise)

In retail property types,rents are quoted on the basis of which of the following?

Assume a retail tenant is paying a base rent of $120,000 per year (or $10,000 per month).In addition,the tenant must pay 7 percent of gross store sales in excess of $143,000 per month as percentage rent.If the store produces $170,000 in gross sales in a month,what is the total rent due for the month?

For most commercial property types,lease lengths can vary considerably.Therefore,both parties must tradeoff between the advantages and disadvantages associated with particular leasing terms.Owners may prefer longer leases for all of the following reasons EXCEPT: