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How do I configure pass-through expenses in CLA?

Estimated reading time: 1 min

Comparative Lease Analysis can handle up to 3 pass-through expenses for each of the six leases. In the example below, the expense for electricity is projected to be $0.50 per square foot per year, increasing by 2.00% per year.

CLA Pass Through Expense Configuration - # 1

In row 24, you enter the total amount of the expense, regardless of who pays for it. The entry for the first year is the amount in dollars per square foot. For later years, you may enter a percentage increase over the previous year, or you may enter a new amount in dollars per square foot. By default, any value you enter will propagate to the right across the row. In this case where it’s just a straight 2.00% increase per year, the tenant will be paying $0.50 per square foot the first year, $0.51 per square foot the second year, $0.5202 per square foot the third year, and so on.

Now suppose the landlord will be paying the first $0.50 per square foot, and the tenant will be paying anything beyond that. To accomplish this, we enter $0.50 in cell D22. By default, this value will propagate to the right across row 22.

CLA Pass Through Expense Configuration - # 2

In this case, the tenant will be paying nothing the first year, $0.01 per square foot the second year, $0.0202 per square foot the third year, and so on.

Now suppose the tenant will only be paying 70.00% of the amount above $0.50 per square foot. We enter 70.00% in cell D21. Again, by default this value will propagate to the right across row 21.

CLA Pass Through Expense Configuration - # 3

In this case, the tenant will be paying nothing the first year, $0.007 per square foot the second year, $0.01414 per square foot the third year, and so on.

You may also enter in row 25 a cap for what the tenant will pay. For example, if you enter $0.02 in cell D25 (by default it will propagate to the right across row 25), then the expense paid by the tenant will be unaffected in the first three years, but starting in the fourth year, the tenant would pay just $0.02 per square foot.

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