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hey everyone its alex moore kate with real estate shorts in this episode were going to talk about free rent were going to define what free rent is in commercial real estate how its applied and some important considerations around its impact on net operating income and valuation lets get started so first what is free rent so free rent is effectively a concession it is an amount of rent forfeited or waived or set up as a rebate to get a tenant to come occupy space in the owners building so for example if you have an apartment building you may run a one month free special and so you can use this to help entice tenants to come and occupy space so they dont have to pay that first month it feels good to the tenant to feel like theyre getting the deal theyre getting a bargain and certainly from the financial perspective it helps them from budgeting to understand that they dont have that expense in that given month so from the owners perspective this concession could be used as a r
