Pennsylvania Building Operating Cost Addendum

State:
Multi-State
Control #:
US-OL19034BB
Format:
Word; 
PDF
Instant download

Description

This office lease form is a supplement regarding the building operating expenses which are escalated to the tenant. This form lists items to be excluded from the calculation of building operating costs.

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How to fill out Building Operating Cost Addendum?

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FAQ

In formula form, it is Operating Cost = Job Cost + Process Cost. Operating costs are of three types: fixed, variable, and semi-variable. Fixed costs do not change based on the number of units produced. Rent and expenses on machinery and equipment are examples of fixed costs.

In real estate, the operating expense ratio (OER) is a measurement of the cost to operate a piece of property, compared to the income brought in by the property. The operating expense ratio (OER) is calculated by dividing all operating expenses less depreciation by operating income.

To calculate operating expenses, divide the total of your expenses by the rent price you're charging tenants (or rental income). If your operating expenses total $500 for a rental with a rent price of $1,375, your gross operating income (GOI) would then be 36.3%.

Use Operating Expense Addendum to Commercial Lease (Form OXA) to explain in detail which operating expenses will be the responsibility of the landlord or the tenant, and which are included in common area maintenance fees.

Owning costs = purchase price of machine + financing + taxes ? disposal price (what you get for that machine when you resell it). Operating costs = labor + fuel + maintenance + replacement costs of tires, tracks and other components + overhead.

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Pennsylvania Building Operating Cost Addendum