Base Year Reset Calculator

Base year reset at renewal changes economics. This calculator sizes impact.

Current base $/SF

Renewal base $/SF

Annual growth %

Renewal years

Space SF

Reset benefit

$94,500

Annual savings

$13,500

Base shift $/SF

How the math works

Reset benefit is the cumulative difference between carry-forward and reset expense pass-through over renewal term.

Base year reset is one of the quietest but most valuable concessions tenants extract at renewal. On a 9,000 SF space with $3/SF gap between old and new base, reset over a 7-year renewal saves ~$95k of pass-through expense — often larger than the rate concession being negotiated in parallel.

How to Use

Enter current base year expenses/SF.
Enter renewal base year expenses/SF.
Enter annual growth %.
Enter renewal term years.
Enter space SF.
Read reset benefit/cost.

Frequently Asked Questions

Reset vs carry?

Reset: new base year = current year's actual expense. Tenant restart with clean slate, pays only increases from new base going forward. Carry: keep old base year. Tenant continues paying cumulative increase from original base.

Who benefits?

Reset: tenant (lowers pass-through in renewal years). Carry: landlord (preserves cumulative recovery). Heavy expense-growth markets: reset very valuable to tenant. Stable markets: difference modest.

Cap on increase?

Can be negotiated alongside base year choice. Combo: reset + 5-7% cap = tenant-friendly. Carry + no cap = landlord-friendly. Real negotiations balance these levers against rate and term.

How often should I rerun this?

Rerun this calculator whenever inputs change materially — new rent roll data, rate moves, loan balance updates, or quarterly operating data. For active deals, monthly refresh is typical. For stabilized assets under monitoring, quarterly is fine. Treat the output as a decision tool, not a one-time answer — market conditions evolve and so should your analysis.