Case Study #3:
Revising the gross-up methodology used by the landlord

The Client:
A very large financial services firm leased 80,000 rsf in a 400,000 rsf office project in Southern California.

The Opportunity:

The lease included a provision requiring the landlord to "gross-up" expenses to reflect operating expenses that would have been incurred had the building been fully occupied.

The Process:
RTG reviewed the gross-up methodologies employed by a prominent national landlord. We challenged their assumptions and formulae related to electrical utilities and successfully induced them to engage an outside utility consultant to review their methods.

The Result:

The landlordís third party utility expert validated RTGís approach, forcing the landlord to pay an immediate refund of $65,000 to our client plus similar annual savings for the remaining years of the lease.



 

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