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Occupancy Permit: A permit issued by the appropriate local governing body to establish that the property is suitable for habitation by meeting certain safety and health standards.
Offset Rights: The right of a tenant to make a deduction from rental payments in an amount equal to that expended by the tenant to make a payment which is the obligation of the landlord, often due to a landlord default. Although offset rights are not common in leases, some larger and/or more sophisticated tenants will require such a clause in their lease as a protection if they are required to perform an obligation which should have been performed by the landlord pursuant to a lease.
Operating Expenses: Amounts which are paid to operate and maintain income producing property. As opposed to non-recurring capital expenditures, operating expenses are typically recurring expenditures. Operating expenses are usually paid by the landlord and may be subject to reimbursement by the tenant via expense recoveries. However, in certain instances, particularly with buildings occupied by a single tenant, the tenant may be required to pay some or all operating expenses directly to the vendor.
Outlot: A freestanding building site within or adjacent to a shopping center. Examples of outlots include gas stations, restaurants or banks. Also called a pad.
Overage Percentage: The percentage which is multiplied by gross sales in the calculation of overage (i.e., percentage) rent.
Overage Lease/Rent: Rent paid by a retail tenant which is based upon a percentage of gross sales in excess of a specified dollar amount (the breakpoint). Also called percentage lease/rent.