# How to Calculate the Monthly Cost of Renting Retail Space for Lease One of the most important factors to consider when determining which retail space you want to rent for your business is monthly cost, however how do you calculate that?

Calculating your monthly retail lease amount involves 3 things: 1. The size (in square feet) of the space you are about to lease (e.g. 1,500 SF) 2. The landlord’s asking base lease rate and estimated operating expenses (e.g. \$25 SF+ \$7 NNN SF) 3. The number 12 (number of months in one year)

Landlords of most retail properties typically require that their tenant’s pay both a base rental rate and their pro rata share of operating expenses (aka NNN or CAM). I will explain more about operating expenses, NNN, and CAM in another session.

Below are a couple of examples on how to calculate the monthly cost of renting retail space for lease.

Retail Example #1 Square footage of Retail Property = 1,500 SF Quoted Base Rental Rate = \$25 SF/Yr Estimated operating expenses (NNN) = \$7 SF/Yr Total asking lease rate = \$32 SF/Yr Yearly Rent = 1,500 x \$32 = \$48,000 Monthly Rent = \$48,000 / 12 = \$4,000 per month

Retail Example #2 Square footage of Retail Property = 3,000 SF Quoted Base Rental Rate = \$30 SF/Yr Estimated operating expenses (NNN) = \$9 SF/Yr Total asking lease rate = \$39 SF/Yr Yearly Rent = \$117,000 Monthly Rent =\$117,000 / 12 = \$9,750 per month