What is "base rent" in commercial appraisals?

Base rent in commercial appraisals refers to the minimum rent amount a landlord can charge before any additional expenses are accounted for. This figure serves as the foundational amount in determining the overall rental structure for a commercial property. It is typically stipulated in a lease agreement and does not include additional costs such as maintenance, property taxes, or insurance, which may be incurred as pass-through expenses. Understanding base rent is crucial for appraisers, as it helps them evaluate the income-producing potential of a property and inform their valuation process.

The other options do not accurately define base rent. The maximum rent that can be charged is not relevant to base rent and doesn’t take into consideration any expenses, while the market value relates to the overall worth of the property, not specifically the rental context. Additionally, rent amount after all expenses are included describes net rent or effective rent rather than base rent, which is focused solely on the amount before those considerations.