How do you compare rents across an office rent roll with mixed lease types?

Convert every tenant to net effective rent per RSF: for full-service leases, subtract the base-year expense stop's implied burden; for NNN leases, add back current opex pass-throughs. Only then are tenant-to-tenant rent comparisons meaningful.

What is a base-year expense stop and why does it matter in diligence?

It's the expense level, fixed at lease signing, above which the tenant reimburses the landlord for opex growth. If the base year was an unusually low-expense year, future reimbursement income is overstated in underwriting; if unusually high, it's understated. Always compare the stated base year against a normalized 2-3 year opex average.

How do you find sublease shadow space on an office rent roll?

The roll itself usually won't flag it, the prime tenant remains the obligor of record. Cross-reference building access/badge data, ask the leasing broker directly, and review any sublease consents in the lease file. Shadow space signals elevated non-renewal risk even while the roll shows the suite as fully occupied.

How do you analyze a rent roll?

Compare every row to the executed lease, tie totals to the GL, compute loss-to-lease, build the expiration schedule, and audit delinquencies. The automated version is a rent roll audit tool.

Office · Rent Roll Analysis

Office Rent Roll Analysis

How to read an office rent roll: full-service vs. NNN bases, base-year stops, sublease shadow space, and expansion-option traps. Free template.

Get the Excel template Automate it with Moraine

Why the rent roll analysis looks different for office

An office rent roll mixes rent structures within the same building: full-service gross leases with base-year stops sit beside NNN leases on the same roll, so the 'rent' column isn't comparable tenant-to-tenant until every lease is normalized to a common basis, typically net effective rent per RSF.

Reconciliation has to account for load factors and gross-up clauses: a tenant's rentable square footage includes a share of common areas, and expense reimbursements are calculated off a base year that can be miscalculated or renegotiated over a long term. A stacking plan, not just the roll, is required to see occupancy accurately floor by floor.

Over a long WALT, watch for sublease shadow space that looks occupied on the roll but generates no rent to the landlord, expansion or contraction options that can shrink the roll without a new lease event, and credit concentration where one or two tenants carry the building's entire debt-service coverage.

The office-specific checklist

1

Tie rent roll to leases

Verify: every tenant has an executed lease on file
2

Reconcile to GL

Verify: three months of collections match rent roll totals within 1%
3

Compute loss-to-lease

Verify: effective vs. scheduled rent; flag >8%
4

Build expiration schedule

Verify: year-by-year; flag any single year >30% of NOI
5

Check delinquencies

Verify: 30+, 60+, 90+ buckets; flag >2% of GSR
6

Normalize every tenant's rent to net effective rent per RSF

Verify: full-service leases converted using stated load factor and base-year stop; NNN leases converted using current opex pass-through
7

Build a stacking plan from the rent roll and reconcile floor-by-floor occupancy

Verify: vacant, occupied, and subleased space match the roll's stated status by suite
8

Identify all sublease space and confirm rent flow to landlord

Verify: prime tenant remains obligor of record; sublease rent, if any, doesn't appear as landlord income on the roll
9

Map expansion, contraction, and termination options by tenant and trigger date

Verify: any option exercisable within the hold period, with SF impact and required notice period
10

Verify base-year expense stops against actual base-year opex

Verify: base year wasn't set artificially low or high relative to a normalized year, which understates or overstates future reimbursement income
11

Calculate WALT and credit concentration by tenant

Verify: top-3 tenant SF share of the roll and each tenant's public credit rating or financial disclosure, where available

Metrics that matter for office

Metric	Target	Calculation
WALT (weighted average lease term)	>5 years for stabilized office	Σ(tenant SF × remaining lease term) / total leased SF
Net effective rent per RSF	consistent within ±10% across comparable floors	(base rent + expense reimbursement − TI/LC amortized over term) / RSF, normalized to full-service equivalent
Credit concentration (top-3 tenants)	<40% of total rent roll SF	SF of top 3 tenants by size / total leased SF
Net effective rent	≥80% of face rent	(face rent × term - TI - free rent value) / term
WALT (yrs)	>5 for core	weighted avg remaining lease term
Occupancy	>90% for core	leased SF / rentable SF

Red flags unique to office

Sublease space counted as occupied on the roll with no shadow-space flag

the prime tenant is often the one exiting, subleased space depresses the true leasing market and frequently rolls back to the landlord at the prime lease's expiration with no replacement demand
Base-year expense stop set materially below a normalized opex year

the landlord's reimbursement income looks artificially high in Year 1 and then compresses hard once expenses catch up to a properly calculated base, a common broker pro forma error
Single tenant expansion option overlaps another tenant's occupied space

the roll shows both tenants as stable, but the expansion right, if exercised, forces a relocation or buyout that the pro forma never budgeted
Net effective rent more than 15% below face rent

high TI + free rent burns more of stated rent than the pro forma assumes
Rollover concentration above 30% in any single year

single-year rollover exposure in a soft office market is the dominant underwriting risk
Sublease availability exceeding 10% of market stock

tenants are offloading space — direct rents will follow down
Operating expense pass-through base year inconsistency

mismatched base years mean recoveries don't actually protect landlord

Example — office rent roll analysis walkthrough

Say a 310,000 SF Class A office building in a secondary CBD is trading at $71M, roughly $229/SF. The rent roll shows 87% leased, a WALT of 6.2 years, and $6.4M in gross rent, with the two largest tenants, a regional bank at 62,000 SF and a law firm at 48,000 SF, anchoring 35% of the roll.

Normalizing rent to a net-effective basis is the first task. Six tenants are on full-service gross leases with base-year stops; the rest are NNN. Pulling each lease's base year against the building's actual opex history, the bank's 2022 base year was set at $9.10/RSF, but building-wide opex that year was depressed by a one-time insurance credit; a normalized base year would run closer to $10.35/RSF. That $1.25/RSF gap, applied to 62,000 SF, means the landlord is under-recovering roughly $77,500/year in reimbursement income the pro forma assumed it would collect once expenses grew into a properly set base.

The stacking plan has its own problem. The roll shows the law firm's 48,000 SF as fully occupied, but building access logs and a leasing broker inquiry confirm 14,000 SF of that suite has been subleased to a fintech startup for the past 9 months. Rent flows from the startup to the law firm, not to the landlord, and the law firm's own lease has 22 months remaining with no renewal indication. That 14,000 SF is effectively shadow vacancy: if the law firm doesn't renew, the landlord re-leases into a market the sublease rate suggests is softer than the roll implies.

Layering the two findings: $77,500/year in understated expense recovery from the base-year miscalculation, plus a 14,000 SF block, 4.5% of the building, carrying elevated non-renewal risk behind a sublease that doesn't show up as a red flag on the roll itself. At a 6.75% cap on the reimbursement shortfall alone, that's roughly $1.15M of valuation drag, before pricing in re-leasing costs and downtime if the law firm's 22-month runway ends in a vacancy rather than a renewal.