Rent per square metre figures

[JIT]

Hi,

When agents quote ''rent per square metre'' figures, are they talking about ''gross rent per square metre'' or ''net rent per square metre''?

Thanks!

 

[Aaron_C]

Usually it is gross rent per sqm as the tenant has to pay for the outgoings which is on top of the rental as specified in the lease. Sometimes it is a net lease if the outgoings are apportioned in a strata-titled office building or shopping centre.

 

[JIT]

Add further to my initial post, are the rent figures quoted inclusive of GST or exclusive of GST?

Thanks.

 

[Aaron_C]

Add further to my initial post, are the rent figures quoted inclusive of GST or exclusive of GST?

Thanks.

It should always exclude GST or it is misleading. GST is not income.

 

[Dazedmw]

It really depends on what the market usually does. CBD office building rentals are nearly always quoted on a Gross basis however most commercial/retail/industrial Melbourne suburban properties will be quoted on a net basis.

As stated above, rents should be quoted exclusive of GST but sometimes with low value suburban retail prices are quoted inclusive as that is the terminology retailers speak in.

 

[Scott No Mates]

Usually it is gross rent per sqm as the tenant has to pay for the outgoings which is on top of the rental as specified in the lease. Sometimes it is a net lease if the outgoings are apportioned in a strata-titled office building or shopping centre.

Sorry to contradict you Aaron, a gross rent is all inclusive whereas a net rent has outgoings payable on top. This is equally applied to commercial, retail or industrial property.

Agents will generally not specify gross or net - they let you take the punt unless you ask. Definitely, the majority of agents quote a rent as gst exclusive unless the rent is for an owner who is not registered for GST.

 

[JIT]

As stated above, rents should be quoted exclusive of GST but sometimes with low value suburban retail prices are quoted inclusive as that is the terminology retailers speak in.

Thanks Dazedmw, certainly worth double checking.

Agents will generally not specify gross or net - they let you take the punt unless you ask.

Thanks Scott, this is what I am seeing too, it could be anything unless you ask!

 

[Dazedmw]

Thanks Scott, this is what I am seeing too, it could be anything unless you ask!

Yes, always best to ask, or even better read the lease! Especially with low value commercial property its often the case that the agents don't really know either.

 

[JIT]

or even better read the lease! Especially with low value commercial property its often the case that the agents don't really know either.

Yeah, I'm waiting for the lease to be sent to me, will post back my findings.

 

[Scott No Mates]

Don't just get the lease, also request a copy of the previous x years outgoings reconciliations as well (if it is a net lease) or the total income/expenditure statement for the property.

 

[Dazedmw]

Don't just get the lease, also request a copy of the previous x years outgoings reconciliations as well (if it is a net lease) or the total income/expenditure statement for the property.

Good point. It's good information if you can get it.

 

[JIT]

Don't just get the lease, also request a copy of the previous x years outgoings reconciliations as well (if it is a net lease) or the total income/expenditure statement for the property.

Another email to the agent!

 

[John M]

Sorry to contradict you Aaron, a gross rent is all inclusive whereas a net rent has outgoings payable on top. This is equally applied to commercial, retail or industrial property.

Agents will generally not specify gross or net - they let you take the punt unless you ask. Definitely, the majority of agents quote a rent as gst exclusive unless the rent is for an owner who is not registered for GST.

To back up Scott, agents should always quote net or gross; however, in reality this rarely happens unfortunately.

The quoted rent should certainly be exclusive of GST.