Cotenancy Rent Abatement Calculator

Cotenancy clauses trigger rent abatement. This calculator sizes the NOI hit.

Triggered tenants

Avg annual base rent per tenant

Rent abatement %

Abatement months

CAM per tenant per year

% CAM still collected

Total abatement cost

$745,200

Base rent lost

$648,000

CAM lost

$97,200

How the math works

Rent lost = tenants × avg rent × abatement % × months/12. CAM lost = tenants × CAM × (1 − collected %) × months/12. Sum for total.

18 tenants × $72k × 50% × 1 yr = $648k rent. CAM $18k × 30% × 18 tenants = $97k CAM. Total ~$745k — material hit that drives cotenancy negotiation leverage.

How to Use

Enter number of triggered tenants.
Enter average base rent per tenant.
Enter abatement %.
Enter abatement months.
Enter % of CAM still owed.
Enter CAM per tenant.
Read total abatement cost.

Frequently Asked Questions

How do cotenancy clauses work?

Retail leases routinely allow small-shop tenants to reduce rent (to 50% of base, or to a % of sales) when specific co-tenants — usually the anchor or a threshold % of the GLA — go dark. Triggers vary: anchor-specific, occupancy-threshold, and named-cotenant are the three common forms.

What rent typically abates?

Common structures: 50% base rent reduction, alternate rent tied to sales (3-6% of gross), or full rent abatement after cure period (typically 6-12 months). CAM and taxes often remain owed at a reduced pro-rata. Severe abatement can go 18-24 months before cotenant replacement is required.

Why model it?

Lenders and buyers stress-test cotenancy risk on retail. A shopping center with 20 small shops at $35/SF paying 50% abatement for 18 months can lose $3-5M NOI — often bigger than the anchor rent itself. Cotenancy exposure is the key difference between trading at 6% vs 8% cap rate.