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Right Of First Offer Value Calculator

ROFO gives tenant first look at adjacent space at negotiated or market rates.

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ROFO expected value

$63,000

Max value (if exercised)

$157,500

Annual discount

$31,500

How the math works

Max value = SF × market × discount × years. Expected = max × probability.

15k × $42 × 5% × 5 = $157.5k max. × 40% exercise = $63k expected ROFO value.

How to Use

  1. Enter space SF.
  2. Enter avg market rent/SF.
  3. Enter negotiation discount %.
  4. Enter probability of exercise %.
  5. Enter option term years.
  6. Read ROFO value.

Frequently Asked Questions

ROFO mechanics?

Landlord must notify tenant before marketing adjacent space. Tenant has X days (typically 10-30) to decide if they want to negotiate. Landlord can market freely after notice window unless tenant engages. No right of refusal.

Value to tenant?

Controls adjacency. Prevents competitor moving in. Option to grow without full market search. Typically 2-5% of current rent value. Negotiated discount may not materialize if tenant leverage is weak.

Landlord considerations?

Complicates leasing (must notify ROFO tenant). Potential rent discount. Delay while tenant decides. Some landlords resist ROFO entirely; many grant for creditworthy tenants. Institutional landlords more flexible.

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