Exam 22: Managing Non-Residential Rental Property

The two most important determinants of the classification of an office property are age and obsolescence.Which of the following classes includes office buildings that are older and reasonably maintained,but are below current standards for one or more reasons?

A recent trend in commercial leases is for tenants to negotiate a cap on the amount of certain operating expenses they are required to reimburse the landlord.Such caps are usually negotiated on operating expenses thought to be at least partially controllable by the owner.Which of the following would typically be considered an operating expense controllable by the owner?

In contrast to rent for residential units,rent for U.S.commercial properties is typically quoted as:

While a sublease and an assignment are two distinct choices for a tenant who wishes to transfer his rights during the term of a lease,both agreements:

The choice of which method to use in constructing the contracted rental rate can also be impacted by the type of property being leased.With which of the following property types would one most expect to see a percentage rent method used?

The majority of residential units in the U.S.are contained in multifamily structures,or apartment buildings that contain five or more housing units.Which of the following multifamily structures will range in height from four to nine stories and are typically found in both cities and suburbs?

Given the following information,calculate the load factor for this office property.Total usable area: 20,000 sq.ft. ,Tenant's prorated share of common area: 5,000 sq.ft.

The large and generally well-known retailers who draw the majority of customers to a shopping center are more commonly referred to as:

When the supply of space exceeds the demand,it is common for owners to provide the tenant with a period of free or perhaps reduced rent.This is commonly referred to as a(n):

A tenant who expects her business to grow may wish to have a clause included in her lease that grants her the choice to lease adjacent space as soon as it becomes available.This lease option is more commonly referred to as a:

A lease option is a clause that grants an option holder the right,but not the obligation,to renew the lease,cancel the agreement,relocate within a property,or even expand to adjacent space.The existence of these options in a leasing agreement:

In commercial leases,rents do not necessarily have to be kept constant over the life of the lease term.One option is for there to be pre-specified increases in the contract rental rate over time,sometimes referred to as "step-ups" or "escalations." This type of rent treatment is commonly referred to as:

Once possession and control are conveyed in a lease agreement,the owner must provide the tenant with uninterrupted use of the property without any interference from any entity that may threaten to impose upon the tenant's leasehold interest in the property.In other words,the tenant is entitled to which of the following?

In an indexed lease,rents are dependent on a regularly reported index,most commonly the consumer price index (CPI).By using the CPI as an index rate,the risk of unexpected increases in general inflation is shifted to the __________,and therefore a _________ base rental rate will typically be required.

Of the following choices,which best describes the operating expenses that you would expect to be the paid by the tenant in a net lease agreement?

The lease is a contract between a property owner and tenant that transfers exclusive use and possession of space to the tenant,but allows the owner to retake possession of the property at the expiration of the lease.Which type of interest allows the owner to retake possession at the end of a lease?

To the extent the tenant is permitted to alter the leased premises,the lease should clearly state when this may be done,and under what circumstances.The lease must also be clear about the ownership of such improvements once completed.Which of the following terms refers to items of personal property that are attached to the real property,are paid for and installed by the tenant,and may be removed by the tenant at the termination of the lease?

Some tenants who are subject to long-term leases may desire to transfer all of their tenant rights and obligations to another party.This is commonly referred to as a(n):

Lenders may request that property owners of rental properties include a clause in their lease agreement that gives the lender the right to terminate the lease and evict the tenant,even if the tenant has fulfilled all of its responsibilities under the lease,in the case that the owner of the property defaults on her mortgage.This part of the lease agreement is more commonly referred to as a:

When securing a new tenant for a commercial rental property,the owner of the property might incur an additional expense that amounts to the cost of refurbishing the rental space to meet the needs of the tenant's business.The allocation of money for this added expense is more commonly referred to as a(n):