Allocating Operating Expenses in Commercial Real Estate Leases: Negotiating Strategies for Landlords and Tenants
Structuring Pass-Throughs, Exclusions, Gross-Up, Expense Cap, and Other Operating Expense Provisions in Net and Gross Leases
A live 90-minute premium CLE webinar with interactive Q&A
This CLE webinar will discuss net and gross real estate lease structures and the allocation of operating expenses for each lease structure. The program will discuss negotiation from the perspectives of both landlords and tenants on defining operating expenses, pass-throughs and exclusions, and other lease provisions impacting expenses such as gross-up and expense cap provisions.
Outline
- Brief overview of different types of lease structures
- Standard operating expense inclusions and exclusions
- Gross-up provisions
- Expense cap provisions
- Audit rights of landlord operating costs
Benefits
The panel will review these and other key issues:
- Structuring gross-up provisions to protect both landlord and tenant
- Considerations for drafting a cap on operating costs
- Reasonable audit rights for operating expenses
- Essential differences in expense reimbursement provisions in retail and office leases
Faculty

Scott D. Brooks
Partner
Cox Castle & Nicholson
Mr. Brooks has vast experience in all aspects of developer/owner representation, including leasing, acquisitions and... | Read More
Mr. Brooks has vast experience in all aspects of developer/owner representation, including leasing, acquisitions and dispositions, and joint venture structuring, with a particular emphasis on commercial leasing. Mr. Brooks has extensive experience in the negotiation and documentation of all types of retail leases and has worked with large and small retail developers and operators on leasing matters within regional malls, community shopping malls and mixed-use projects, among others.
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Robert J. Sykes
Partner
Cox Castle & Nicholson
Mr. Sykes handles real estate transactions of all sizes on a national basis, representing retail, industrial, office,... | Read More
Mr. Sykes handles real estate transactions of all sizes on a national basis, representing retail, industrial, office, medical and multi-family residential developers and owners in a wide range of projects. His practice focuses on property acquisition, finance, development (including redevelopment), leasing and construction. Mr. Sykes has been responsible for the acquisition, development and leasing for numerous shopping centers, offices, industrial, apartments and mixed-use development projects.
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