Operating Expense Estimate Clause Samples
The Operating Expense Estimate clause defines how projected costs for operating a property or business are calculated and communicated, typically on an annual basis. This clause outlines the process by which the landlord or operator estimates expenses such as maintenance, utilities, insurance, and taxes, and may specify how these estimates are provided to tenants or stakeholders, often at the start of each fiscal year. Its core practical function is to provide transparency and predictability regarding future financial obligations, helping both parties budget effectively and avoid disputes over unexpected costs.
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Operating Expense Estimate. Prior to the commencement of each Operating Year during the term, Landlord may at its option estimate the amount of Operating Expenses for such Operating Year or (if applicable) broken portion thereof, as the case may be, and notify Tenant in writing of the amount of its Proportion of Operating Expenses. The amounts so estimated shall be payable in equal consecutive monthly instalments in advance over such Operating Year or (if applicable) broken portion thereof, such monthly instalments being payable on the same day as the monthly payments of rental. Landlord may, from time to time, alter the Operating Year, in which case, and in the case where only a broken portion of the Operating Year is included within the term of this lease, the appropriate adjustment in monthly payments shall be made. From time to time during the Operating Year, Landlord may re-estimate any of the foregoing on a reasonable basis for such Operating Year or broken portion thereof, in which event Landlord shall notify Tenant in writing of such re-estimate and fix monthly instalments for the then remaining balance for such Operating Year or broken portion thereof such that, after giving credit for the instalments paid by Tenant on the basis of the previous estimate or estimates, the entire amount of its Proportion of Operating Expenses will have been paid during such Operating Year or broken portion thereof
Operating Expense Estimate. Prior to the commencement of each Lease Year, the Landlord shall estimate the amount of Operating Expenses for such Lease Year and notify the Tenant in writing of such estimate, providing reasonable details as to the breakdown and calculation thereof. The estimate may not exceed the Operating Expenses for the previous year by more than ten percent (10%). As soon as practicable during each Lease Year, the Landlord shall provide the Tenant with reasonable evidence of the amount of Taxes payable by the Tenant and the monthly installments of Additional Rent shall be adjusted accordingly. For the first (1st) Lease Year, the total Operating Expenses are estimated to be ten thousand dollars ($10,000), plus the cost of insuring the Building which is estimated to be fourteen thousand five hundred dollars ($14,500), payable in equal consecutive installments of one thousand two hundred eight dollars and thirty-three cents ($1,208.
Operating Expense Estimate. During the thirty (30) day period following execution of the this Fourth Amendment to Lease the parties will work together in good faith to determine an equitable allocation of Operating Expenses for the 2004 Operating Year and thereafter, taking into account the Operating Expenses actually incurred and payments made by each party for Operating Expenses actually incurred. Within such thirty (30) period the parties will agree upon an Operating Expense allocation for the period from June 14, 2004 and October 31 and within fifteen (15) days thereafter Tenant shall remit to Landlord payment for the period from June 14, 2004 to October 31, 2004. Thereafter payment for Operating Expenses shall be made on a monthly basis in accordance with the terms and conditions of the Lease. Tenant agrees to continue be responsible for and to make payments for the electricity for the Leased Premises during the Term of the Lease.