108. How to Calculate Commercial Rent [Price Per Square Foot Simplified]

How to Calculate Commercial Rent [Price Per Square Foot Simplified]

Today, I'm going to teach you how to calculate commercial rents based on price per square foot. Commercial real estate, much like other industries, is rampant with its own unique lingo. Words like “triple net” and “cap rate” are thrown around as if they’re common knowledge, but if you’re not in commercial real estate, you likely won’t be able to keep up with the various terms. Calculating commercial rent can be just the same. When a commercial real estate broker or property owner tells you that their property is “$32.00 per foot, triple net,” what does that actually mean? Wouldn’t it be easier if rent was just given on a total monthly amount? Well, yes and no. Commercial rents are calculated on a price per square foot basis because, more often than not, spaces may be divided or combined. These numbers give industry professionals a quick snapshot to compare rent prices among various properties. After all - $5,000 per month doesn’t tell you how big the space is or what is included in the base rent. Here's how to calculate commercial rents when you've been given a price per square foot and I'll also include a commercial rent calculator.

How to Calculate Commercial Rent [Price Per Square Foot Simplified]
The Commercial Real Estate Investor Podcast
Subscribe to the Podcast
Featured
386. How I Bought My First Commercial Property at 25 (just copy me)
386. How I Bought My First Commercial Property at 25 (just copy me)

In February 2019, I wired $575,000 to a title company and closed on my first commercial property. A former community bank in a Nashville suburb that two different buyers had already walked away from. For the next year, I questioned whether I'd just made the biggest mistake of my life.

Read more →
385. The 1031 Move That Lets You Buy Before You Sell
385. The 1031 Move That Lets You Buy Before You Sell

Most investors hear "1031 exchange" and immediately think the same thing:

Avoid capital gains taxes.

And while that's true, it's also why so many investors use the strategy incorrectly.

A 1031 exchange is one of the most powerful wealth-building tools in real estate, but it should be part of a long-term portfolio strategy, not a last-minute reaction when you're getting ready to sell a property.

Read more →
384. Watch Me Underwrite a Real Industrial Deal in 30 Minutes
384. Watch Me Underwrite a Real Industrial Deal in 30 Minutes

Before most investors ever make an offer, they convince themselves there are no deals left.

The market is too competitive.
Prices are too high.
Everything worth buying is already gone.

So in this Office Hours session, I decided to test that theory.

Read more →
383. 100 Doors. 35% Returns. Why He's Walking Away.
383. 100 Doors. 35% Returns. Why He's Walking Away.

Ray Smith built a portfolio of 100 single-family rentals paying him 35% a year. He's a year and a half into a three-year plan to sell every single one.

This conversation is the most honest take I've heard on what it actually costs a residential investor to make the jump into commercial.

Read more →
381. He Doubled His Cash Flow Without Buying a Single New Property
381. He Doubled His Cash Flow Without Buying a Single New Property

Chris Thorndike bought a rundown $400K warehouse in Gainesville, Florida and converted it into six micro retail suites. Over 120 people applied to rent the six spaces. It has not had a single vacancy in two and a half years. Most investors would have moved on and gone hunting for the next deal. Chris almost did too. Then he looked a little closer at what he already owned.

Read more →
382. The Tax Strategy High-Earners Use to Offset Income With Real Estate
382. The Tax Strategy High-Earners Use to Offset Income With Real Estate

Most high earners don’t have an income problem.

They have a tax problem.

And commercial real estate investors play by a completely different set of rules.

In this week’s Office Hours, I break down one of the most powerful tax strategies in real estate: cost segregation. Not the surface-level version people throw around online, but how it actually works in practice and why investors use it to create massive first-year tax savings.

Read more →
380. Graham Stephan Just Made the Case for Commercial Real Estate
380. Graham Stephan Just Made the Case for Commercial Real Estate

If you've been waiting for the right time to buy commercial real estate, this is it - join the CRE Accelerator Mastermind and I'll help you make it happen: https://accelerator.crecentral.com/OO I'm Selling Everything: https://www.youtube.com/watch?v=YJx58bOo5g0 Graham Stephan just made the case for commercial real estate and I don't think he realized he did it. In his recent video "I'm Selling Everything," Graham walked through exactly why he's exiting his entire LA rental portfolio: 4-5% cash flow on equity, the $400 permit fee to replace a $500 fence, the constant "background noise" of being a residential landlord, and a California regulatory environment that's actively pushing capital out of housing.

Read more →
379. The Tax Code Was Written for Real Estate Investors
379. The Tax Code Was Written for Real Estate Investors

Most investors focus on making more money. Sophisticated real estate investors focus on keeping more of it.

In this episode, we break down the tax strategies commercial real estate investors use to build long-term wealth while legally minimizing taxes. From depreciation and cost segregation to 1031 exchanges and refinancing strategies, this conversation covers the exact framework many high-net-worth investors use to compound their portfolios faster.

Read more →
378. He Stopped Buying Airbnbs and Built a $20M Hotel Portfolio
378. He Stopped Buying Airbnbs and Built a $20M Hotel Portfolio

Michael Russell built a portfolio of luxury Airbnbs in Maui and then regulation shut the door on scaling any further. So he did what most investors wouldn’t: he bought a hostel in the middle of COVID, when occupancy was zero and everyone thought he was crazy.

Read more →
377. I'm Building 43,000 SF of Flex Space at 1/3rd of The Cost - Office Hours
377. I'm Building 43,000 SF of Flex Space at 1/3rd of The Cost - Office Hours

The going rate to build 43,000 square feet of flex space from the ground up right now is somewhere between $6 and $8 million. I'm doing it for around $2 million and in this week's Office Hours, I'm showing you exactly how.

The answer isn't a secret or a shortcut. It's a structure called the master lease and it's the most powerful tool in commercial real estate that almost nobody teaches.

Read more →

About Your Host:

Tyler Cauble, Founder & President of The Cauble Group, is a commercial real estate broker and investor based in East Nashville. He’s the best selling author of Open for Business: The Insider’s Guide to Leasing Commercial Real Estate and has focused his career on serving commercial real estate investors as a board member for the Real Estate Investors of Nashville.