ELECTRICITY USAGE CLAUSES

Electricity usage clauses are an important component of any New York City commercial real estate lease. There are different ways in which commercial landlords bill their tenants for electricity:

Rent Inclusion

The landlord bills electricity directly to the tenant on a monthly basis and at a fixed amount per square foot. Typically, electricity costs for commercial office space range from $3.00 to $4.00 per Square Foot.

Sub-Meter

In this case the demised space has its own meter, which the landlord reads each month. The landlord bills the tenant for the cost of electricity consumed plus an administrative fee ranging from 5% to 20% of the base electricity cost.

Direct Electricity

The most cost effective electricity clause in a commercial lease permits the tenant to buy electricity directly from the utility company. An electricity meter must be present in the space for direct electricity to be an option. Full floors or large commercial spaces tend to have their own electricity meters.