Calculate Effective Rent Spreadsheet

Determine effective rent of landlords and tenants while considering discount rates and uneven rent payments.

discount rateeffective rentfinancefreelandlordpresent valuereal estatetemplatetenant

Description
This template aims to adjust uneven rent payments to ultimately make the effective rent (in other words the equivalent period payment) have the same present value. Three things are considered here: discount rates, the perspectives of landlords and the perspectives of tenants.

In the landlord's perspective, the following inputs are needed:
- SQFT Leased
- Term (In Months)
- Commencement Date
- Contract Rent
- Month Free Rent
- Above TI
- Annual Escalations
- Discount Rate

In this, we get the following outputs:
- Effective Rent Monthly
- Per Sq ft Per Month
- Per Sq Ft Per Year

In the tenant's perspective, the following inputs are needed:
- SQFT Leased
- Term (In Months)
- Commencement Date
- Contract Rent
- Month Free Rent
- Above TI Provided By Landlord
- Annual Escalations
- Discount Rate
- TI Paid by Tenant
- Occupancy expenses PSF
- Growth Rate in Operating Expenses

Lastly we get the correspondent outputs:
- Effective Rent PSF
- Effective Rent Monthly
- Level Annuity Cost to Occupy PSF
- Level Annuity Cost to Occupy

by Prof. Norm Miller, PhD

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1 Excel spreadsheet

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  • Mike Terranova
    Also is there a similar spreadsheet for gross effective rent?
    arrow_drop_uparrow_drop_downReply reply
    • Mike Terranova
      How can I increase the length of the lease term beyond 5 years on this sheet?
      arrow_drop_uparrow_drop_downReply reply
      please wait...