How to Split Rent by Square Footage for Your Commercial Space

When leasing commercial properties such as office space, retail space, or industrial space, it's important to divide the rent based on square footage. This ensures a fair and equitable distribution of costs among tenants. In this blog post, we'll discuss the best way to accomplish this task, taking into account the high-traffic nature of commercial spaces.

By following these steps, you'll be able to efficiently split the rent and avoid any potential conflicts or misunderstandings with your co-tenants.

Calculate the Total Square Footage of the Space

The first step in splitting the rent by square footage is to calculate the total square footage of the commercial space. Measure the length and width of each area and multiply them together to get the square footage. Add up the square footage of all the areas to get the total.

Assign a Value to Each Square Foot

Once you have the total square footage, assign a value to each square foot based on the rental rate. Divide the total rent by the total square footage to get the cost per square foot. This will be the basis for splitting the rent.

Determine the Square Footage for Each Tenant

Next, determine the square footage for each tenant. Measure the length and width of their respective areas and calculate the square footage. Multiply the square footage by the cost per square foot to get the portion of the rent that each tenant will be responsible for.

Include High-Traffic Areas in the Rent Split

In commercial spaces, there are often high-traffic areas that benefit all tenants, such as hallways, elevators, or common areas. These areas should be included in the rent split to ensure fairness. Allocate a portion of the rent for these areas based on the square footage or usage.

Review and Adjust the Rent Split

Once you have calculated the rent split based on square footage, review it with all tenants and make any necessary adjustments. Consider factors like location, amenities, or usage to ensure a fair distribution of costs. Open communication and collaboration among tenants are key to reaching a mutually agreeable arrangement.

Create a Written Agreement

Finally, create a written agreement that outlines the rent split based on square footage. This agreement should be signed by all tenants and serve as a reference in case of any disputes or changes in the future.

Ensure Fairness and Transparency in Rent Splitting

Splitting rent by square footage is a fair and transparent method for commercial spaces. By following the steps outlined above, you can ensure that each tenant pays their fair share based on their use of the space. Switch, a mobile payment platform, can simplify the process of collecting and managing rent payments among tenants. With its easy-to-use interface and transparent features, Switch can help streamline the financial aspect of sharing a commercial space.

Create a stress-free experience for renting commercial space

• Calculate the total square footage of the space
• Assign a value to each square foot
• Determine the square footage for each tenant
• Include high-traffic areas in the rent split
• Review and adjust the rent split
• Create a written agreement
• Ensure fairness and transparency in rent splitting

By following these steps and utilizing Switch, you can effectively split the rent by square footage and create a stress-free experience for everyone involved.