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Mixed-use properties require landlords to allocate shared area costs across retail, office, and residential components — each governed by different lease structures, recovery methodologies, and exclusion sets. When shared area allocation is not recomputed correctly as the tenant mix changes, some components absorb disproportionate costs while others are undercharged. The complexity is compounded by leases that specify different allocation bases for different expense categories within the same property.
Verify Shared Area Allocations Across Components
Firststreet structures shared area cost allocation logic from mixed-use lease language and verifies it against actual expense distributions each reconciliation period, flagging cross-component imbalances before statements are issued.
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