Expense Stop Recovery Calculator

Expense stops pass costs above base. This calculator sizes recovery.

Base year expenses $/SF

Current year expenses $/SF

Tenant SF

Pro rata %

Recovery owed

$22,950

Expense increase $/SF

Annual tenant burden

$22,950

How the math works

Recovery = (current − base) × SF × pro rata.

Expense stop structures front-load the landlord's recovery into the base year. For new leases during high-inflation periods, tenants should push for later base year (sliding scale 6-12 months later than commencement) to capture some inflation in the stop and reduce future pass-through.

How to Use

Enter base year expenses/SF.
Enter current year expenses/SF.
Enter tenant space SF.
Enter tenant pro rata %.
Read recovery owed.

Frequently Asked Questions

Expense stop vs CAM?

Expense stop: base year establishes 'stop.' Tenant pays increases above base. CAM: tenant pays pro rata share from year 1. Expense stop more tenant-friendly (no year 1 CAM burden). CAM more landlord-friendly (full recovery from day 1).

Base year mechanics?

Calendar year or lease year. Actual expenses from base year become 'stop.' Subsequent years: tenant pays increases above stop × pro rata. Reset at renewal optional — big negotiating point.

Controllable vs non?

Controllable (payroll, admin): often capped at 5-7% annual growth. Non-controllable (tax, insurance, utilities): pass-through without cap. Check lease carefully — confusing landlord/tenant disputes common at renewal.

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.