Variable Expense Recovery Calculator

Variable expenses vary with occupancy. This calculator sizes recovery including gross-up.

Variable expense

Occupancy %

Gross-up standard %

Tenant pro-rata %

Tenant recovery

$29,195

Grossed-up pool

$162,195

Recovery (as pct of pool)

18.0%

How the math works

Grossed-up pool = variable × (gross-up / occupancy). Recovery = pool × tenant share.

Audit expense classification annually. A small misclassification (putting a fixed expense in variable pool) over-bills tenants and invites disputes. Keep classification defensible.

How to Use

Enter variable expense.
Enter occupancy %.
Enter gross-up %.
Enter tenant pro-rata share.
Read recovery.

Frequently Asked Questions

What's variable?

Janitorial, elevator service, HVAC maintenance, utilities, general R&M. Fixed: taxes, insurance, depreciation. Wide mix in middle ground; check lease.

Why gross up?

Variable expenses drop when vacancy rises. LL wants to recover as if fully occupied. Without gross-up, tenant share grows as vacancy grows — backwards.

Billing cadence?

Monthly estimate based on prior year + growth %. Annual reconciliation true-up. True-up bills/credits can be significant; estimate accurately.

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.