YOU ASK
How do I give a tenant six months of free rent without also giving away the recoveries?
The short answer
Enter the concession in the tenant’s Free Rent schedule. To keep recoveries payable, also check Pay During Free Rent in the recovery structure and Recoveries % in any assigned Free Rent profile. A positive profile percentage can override the recovery-structure setting.
Work through the checks
- Select the correct tenant in Rent Roll. Open Rental Income, then Base Rent and the Free Rent tab.
- Choose Tenant Specific, add the free-rent entry, set its Date or Month to the agreed start, and enter 6 in # of Months. The free-rent duration must be shorter than the lease term.
- Inspect the assigned recovery structure. Pay During Free Rent should be Yes when the lease requires recoveries during the concession.
- If using From Profile instead, inspect the assigned Free Rent profile. Keep Recoveries % at 0% for a base-rent-only concession; a positive percentage abates recoveries despite the Yes setting.
- Check base rent and recoveries separately in the tenant cash flow during and after the concession. Match the dates and treatment to the actual lease.
| Original teaching example | Months 1–6 | Month 7 |
|---|---|---|
| Base rent before concession: 10,000/month | 0 payable | 10,000 payable |
| Recoveries before concession: 2,000/month | 2,000 payable | 2,000 payable |
Illustrative lease amounts with no other changes. This is an expected treatment to check, not a report calculated by ARGUS Enterprise.
THE EASY MISTAKE
Setting Pay During Free Rent to Yes is not the whole check when a Free Rent profile also changes recoveries.