Early Termination Fee Negotiation Calculator

ETF settles remaining lease liability.

Remaining rent PV

Unamortized TI

Unamortized LC

Mitigation discount %

Fair ETF

$1,420,000

Gross liability

$1,840,000

Mitigation amount

$420,000

How the math works

Gross = rent PV + unamortized TI + LC. Mitigation = rent PV × %. Fair ETF = gross − mitigation.

$1.4M + $320k + $120k = $1.84M gross. − $420k mitigation = $1.42M fair ETF.

How to Use

Enter remaining rent PV.
Enter TI/LC amortization remaining.
Enter landlord mitigation discount %.
Read fair ETF amount.

Frequently Asked Questions

ETF structure?

Lump sum paid by tenant to terminate lease. Typically: remaining rent PV + unamortized TI + LC, minus landlord's ability to re-lease. Often 6-12 months' rent at minimum; larger for long remaining terms with high TI.

Mitigation?

Landlord has duty to mitigate (re-lease). Faster re-lease = lower tenant liability. ETF typically discounts for estimated mitigation period (3-9 months). Some states: full remaining obligation owed until re-leased; others: reasonable mitigation required.

Typical terms?

12-24 months' rent + unamortized TI + LC. Or 6 months' rent minimum. Or sliding scale (larger fee in early years, declining by year). Each structure creates different economics — negotiate carefully upfront.

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.