Fee Offset Credit Calculator

Fee offsets credit LP for ancillary GP income to avoid double-dipping.

Management fee

Acquisition fees earned

Disposition fees earned

Offset %

Net mgmt fee

$4,940,000

Offset amount

$2,560,000

Total LP benefit

$2,560,000

How the math works

Offset = ancillary fees × offset %. Net mgmt fee = mgmt fee − offset.

($2M + $1.2M) × 80% = $2.56M offset. $7.5M mgmt − $2.56M = $4.94M net mgmt fee.

How to Use

Enter annual management fee.
Enter acquisition fees earned.
Enter disposition fees earned.
Enter offset percentage %.
Read net management fee.

Frequently Asked Questions

Fee offset mechanics?

LP credits portion of management fee for each ancillary fee earned. Typical: 50-100% offset of acquisition/disposition fees against management fee. Prevents 'double-dipping' on same deal.

Typical offset terms?

Institutional: 100% offset (one-to-one). Standard: 50-80% offset. Syndication: 0-25% offset. Offset structure reflects LP sophistication and negotiating power. Fee offset a key LPA negotiation term.

Economic impact?

On $500M fund with 1.5% mgmt fee = $7.5M/yr. If GP earns $3M in acq/disp fees, 80% offset = $2.4M credit. Net mgmt fee = $5.1M/yr. Material LP benefit.

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.