9.10 B. Fair Share

• Jurisdiction: New York

B. Fair Share

Rent escalation formulas, whether tied to direct operating expenses or to an index (see the next section), should limit the tenant’s obligation to pay a fair share of a building’s total costs. Usually this means that a tenant will be responsible for expenses in proportion to how much of the building it leases.

Watch out. Some leases make the building’s “rented” area (rather than “rentable” area) the denominator in the fraction. This means that the tenant, not the landlord, would pay...