Operating Expense Stop Calculator

OpEx stops limit tenant expense burden.

Current OpEx PSF

Base year stop PSF

Years held

Annual expense growth %

Annual billable to tenant

$40,000

Landlord absorbed annual

$180,000

Total billable over years

$212,365

How the math works

Over stop PSF = current − stop. Billable = over × SF. Totals grow with escalation.

$22 − $18 = $4 over × 10k SF = $40k/yr. $180k landlord absorbed. Over 5 yr with 3% growth ≈ $212k total billable.

How to Use

Enter current OpEx PSF.
Enter base year stop PSF.
Enter SF.
Enter years held.
Enter annual expense growth %.
Read tenant billable and landlord absorbed.

Frequently Asked Questions

Stop mechanics?

Base year stop sets maximum OpEx landlord absorbs. Above stop is tenant's pro-rata share. Fixed stop in absolute $ terms or PSF. Modified gross leases standard. Landlord protects against commodity price spikes affecting rent-burdened tenants.

Typical stops?

Market standard: base year = prior calendar year's OpEx. Fixed stop: negotiated at $15-25/SF typical. Caps: annual increase cap (3-5%) on expense growth. Each structure balances landlord/tenant risk differently.

Landlord impact?

Rising OpEx during stop period = landlord absorbs. Common in rising property tax markets (CA, FL, TX). Fixed stops become valuable to tenants; costly to landlords over 5+ year leases. Negotiate expense escalators to offset.

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.