B
Base Amount (or Base Stop Amount): For gross leases, the dollar amount (stated in terms of an actual dollar amount or a per square foot amount) which recoverable expenses must exceed before a tenant is required to begin paying Expense Recoveries. Stated differently, the Base Amount is the amount of recoverable expenses which will be borne by the landlord before a tenant is required to pay their proportionate share of such expenses. The Base Amount on a per square foot basis is included in Base Rent.
Base Rent: The minimum amount of rent due under a lease. Base rent may be quoted on a gross basis (a portion of recoverable expenses are included in base rent) or a net basis (base rent excludes any portion or recoverable expenses, with the amount paid by a tenant being ‘net’ to a landlord).
Base Year: For gross leases, it is the recoverable expenses for an annual time period (either a calendar year or a defined fiscal year) above which a tenant is required to pay their proportionate share of such expenses. Typically, the base year is the year in which a lease commences.
Breach: Breaking a law, or not doing what one is supposed to do under a contract of lease.
Breakpoint: In retail leases, the amount which gross sales must exceed before a tenant is required to begin paying percentage rent. Breakpoints may be ‘natural’ or an arbitrary dollar amount. A natural breakpoint reflects the amount of gross sales which, when multiplied by the overage percentage, equals base rent (stated differently, a natural breakpoint is calculated as base rent divided by the overage percentage). If a breakpoint is not natural, then the amount of the breakpoint (stated as an absolute gross sales amount or gross sales per square foot) is arbitrarily determined based upon negotiation between the landlord and tenant.
Broker: An individual or company who acts as an intermediary to negotiate the sale, purchase or lease of real estate. For leases, the tenant, landlord or both parties may engage a broker to negotiate the terms of a lease. In many cases, the broker’s commission is calculated as a stated percentage of the negotiated Base Rent, with the percentage often determined by the geographical market in which the real estate is located.
Building Code: An ordinance that specifies minimum standards of construction for buildings to protect public safety and health.
Business Hours: In retail leases, the hours during which a tenant is required to remain open for the conduct of business.