Q. What is Rentable Square Feet (“RSF”)? and How Landlords Use it to Fleece Tenants!

Imagine if Coca-Cola sold a 16 ounce bottle of soda with only 12 ounces of soda in it.  Three years later, they rename the same bottle of soda a 24 ounce bottle.  These are the same tactics that commercial landlords use.

Rentable Square Feet ("RSF") is an arbitrary number for the amount of space in an office.  This differs from the measureable amount of space, or the Usable Square Feet ("USF").  Why do landlords focus on RSF?  Focusing on RSF is equal to watching the magician's face while his hands perform the magic!  The disappearing act is when the RSF never even appears in the lease!

How can landlords do this?  They attribute it to a "loss factore".  The explanation is they are making up for unusable space elsewhere in the building.  But let's be realistinc, the extra footage isn't lost, it's fabricated.  What's worse is that landlords use the loss factor to "grow" the spaces at the end of every lease.  With lease renewals, a tenant can get a double whammy - both a rate increase and a square footage increase!  Even worse is that over time, loss factors have increased too!

How does a tenant fight back?  There are several tactics we recommend.  Don't hire a landlord agent.  Always compare many properties.  Focus on total costs.  Insist on stating the square footage in the lease.  Negotiate a fixed renewal option. And always measure the space!



Photo by ben o'bro on Unsplash