Industrial Rent Growth Vs Costs Calculator

Industrial enjoyed strong rent growth 2020-23; operating costs track partially.

Baseline rent PSF

Annual rent growth %

Baseline op cost PSF

Annual op cost growth %

Years

NOI growth %

0.29%

Final NOI PSF

$11.33

Initial NOI PSF

$8.80

How the math works

Final rent = base × (1+growth)^yrs. Final op = base × (1+growth)^yrs. NOI growth over period.

$12 × 1.05^5 = $15.32 rent − $3.2 × 1.045^5 = $3.99 op = $11.33 NOI vs $8.8 initial = 28.7% growth.

How to Use

Enter baseline rent PSF.
Enter annual rent growth %.
Enter baseline op cost PSF.
Enter annual op cost growth %.
Enter years.
Read NOI growth.

Frequently Asked Questions

Recent trends?

2020-23: industrial rent grew 15-30% cumulatively. 2024: moderating to 3-5%. 2025+: 2-4% stable expected. Port-proximate sub-markets outperform; interior markets moderate. Class A vs Class B diverges.

Operating cost drivers?

Property tax (often 2-4% annual growth). Insurance (6-10% growth 2022-24). Utilities (variable). Repairs (3-5%). Admin fees. Security. Landscaping. Each category tracks different inflation drivers.

NOI margin?

Industrial is very expense-efficient: 65-75% NOI margin on rent. Compare office 45-55%, multi 55-65%. Margins compressed 2022-24 as taxes and insurance outpaced rent growth. Returning to equilibrium 2025+.

What documentation matters here?

Written leases, move-in/move-out inspections with photographs, ledger entries showing every payment and charge, served notices with proof of service, and contemporaneous emails or texts. Courts weigh written evidence heavily; informal understandings rarely stand. Institutional operators run a monthly file audit to catch gaps before they matter. Good paper trails recover most of what's owed.