How to Compare Two Spaces on Total Occupancy Cost
To compare two spaces, we line up each offer on total occupancy cost per year.
At Reach Commercial Real Estate, we represent tenants. We help you find locations, compare costs, investigate property questions and negotiate the lease. You bring your business plans. We help you evaluate where those plans fit.
This guide covers the information to request for each space, the cost lines to add up and the sales tax, accessibility and permit review facts to put beside them.
1. Write down what each flyer left out
A listing gives us a starting point. We ask for the information needed to evaluate the property.
For each candidate, we request:
Asking rent and quoted square footage.
CAM or NNN estimates and other lease charges.
Annual rent increases.
Previous use and available floor plans.
Known use restrictions.
Parking arrangements.
Sign criteria.
Existing equipment and available records.
Proposed landlord work.
Improvement allowance.
Availability and delivery condition.
We ask what the proposed lease includes rather than rely on the label.
If a critical answer is missing, we keep the property under investigation. We do not treat an unanswered question as an approval.
2. Tour both spaces with the same questions
We map headcount, parking, power and signage before you tour.
During a tour, we look beyond the finishes. We help you identify questions for the landlord and your contractor.
We help gather property information, and your contractor and design professional evaluate the technical work and cost.
How your business runs decides the space: doors, parking ratio, customer traffic and move date.
3. Compare two spaces on total occupancy cost per year
Your occupancy review should include:
Base rent.
CAM and other additional charges.
Scheduled increases.
Utilities.
Repairs and maintenance assigned to you.
Construction and equipment installation.
Deposits.
Rent due before opening.
We compare offers on total occupancy cost: base rent, CAM, taxes, insurance, escalations, buildout and the months of rent you'll pay while contractors are still on site.
We also compare what the landlord offers against what your contractor expects the space to need. We also compare different starting conditions. Each needs its own cost and construction review.
Always compare total cost per year, never base rent alone. The comparison should show what you pay to get open and what you pay to stay open.
The lease terms we advise you to ask for include landlord work versus tenant work, TI allowance, free rent during buildout and a permit contingency.
4. Put the sales tax rule beside both
If your rental or occupancy period begins on or after October 1, 2025, no state sales tax or discretionary sales surtax applies to your rent (Florida Department of Revenue, TIP 25A01-04).
5. Put the accessibility work beside both
Under 28 CFR 36.201(b), the landlord who owns the building and the tenant who owns or operates the place of public accommodation are both subject to the ADA rules. As between them, allocation of responsibility for complying "may be determined by lease or other contract."
When an alteration affects an area that contains a primary function, the path of travel to the altered area and the restrooms, telephones and drinking fountains serving it must be made accessible to the maximum extent feasible, unless the cost and scope are disproportionate to the cost of the overall alteration (28 CFR 36.403(a)(1)).
Path-of-travel work is deemed disproportionate when it costs more than 20 percent of the cost of the alteration to the primary function area (28 CFR 36.403(f)(1)).
Our role is to help bring these findings into your property decision. Your qualified professionals and reviewing agencies determine the requirements.
6. Put the permit review time beside both
Melbourne's Building Section says commercial construction permits typically average 14 to 21 working days for approval or response on a single review.
After signing, your contractor and design team manage plans, permits and construction within their responsibilities. We stay focused on the lease-related items.
Extra items to check
The starting condition. A former cafe, another retail space and an unfinished space each need their own cost and construction review.
Equipment a former tenant left behind. Before assigning value to a former cafe's sinks, counter and equipment, we ask who owns them, what records exist and whether your team finds them suitable for your operation.
Off-site parking. Outside Melbourne's CB-OZ overlay, no more than 50 percent of required parking can be off-site, and those spaces must be within 500 feet under a recorded binding lot agreement (Sec. 9.75).
Your sign. For each candidate, we request the sign criteria. Signage is on the list of work that requires a permit in Melbourne's Building Section FAQ.
Start your search with Reach
You do not need to find the property before calling us. Helping you find and evaluate the property is part of our work.
Bring your requirements, budget, preferred area and target opening date. For each candidate, we request asking rent and quoted square footage, and CAM or NNN estimates and other lease charges. We will use those details to build your search, compare locations and negotiate the lease. In most deals the landlord pays our fee.
Already found a space? Send me the address and listing. We will start with the property questions and deal terms you need to investigate.
Cassandra Hartford, Reach Commercial Real Estate, 321-514-0876, cassandra@reachcommercialre.com, 909 E New Haven Ave #300, Melbourne, FL 32901.
Related: the leasing guide and the guide to operating expense charges.
Frequently Asked Questions
How long does a Melbourne permit application stay valid?
The city's Building Section FAQ says a permit application is valid for 180 days or with current review activity. An issued permit has 180 days to achieve an approved inspection or it is placed in expired status due to inactivity.
What deadline does state law set for permit review of a nonresidential building under 25,000 square feet?
Section 553.792(1)(a)4., Florida Statutes, gives a local government 60 business days after receiving a complete and sufficient application to approve, approve with conditions or deny a building permit for signs or nonresidential buildings that are less than 25,000 square feet, for an applicant using a local government plans reviewer, unless the applicant waives the timeframe in writing.
Sources
Written by Cassandra Hartford, founder and CEO of Reach Commercial Real Estate. She has worked in Brevard County commercial real estate for 17 years, representing buyers, sellers, landlords, and tenants across Florida's Space Coast.
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