What is the Add-On Factor?

With commercial rental properties, the add-on factor is the ratio of the rentable square footage against the usable square footage. This factor is used to determine the tenant’s prorated share of common area expenses.

For example, a building has 20,000 square feet of usable space, but 5,000 square feet is used for general hallways, washrooms, utility closets and for the lobby. That only leaves 15,000 square feet of rentable space or a 75% R/U (rentable/usable) ratio.

For more information, see also the following entries:

• :Commercial Loan:
• :Commercial Real Estate:
• :Common Area Expenses:
• :Investment Property:
• :Lease:
• roration:
• :Real Estate:
• :Real Property:
• :Rent:
• :Rentable Area:
• :Rentable/Usable Factor:
• :Tenant:
• :Usable Square Footage: