What is the typical operating expense as a percentage of gross rent for office assets?

The typical operating expense for office assets as a percentage of gross rent generally falls within the range of 30-40%. This range takes into account various costs associated with the day-to-day operation of office properties, including maintenance, property management fees, utilities, insurance, and property taxes. These expenses can vary based on factors such as location, building type, and the level of services provided to tenants.

In many commercial real estate analyses, it's crucial to understand this range as it helps investors and property managers estimate net operating income, assess the property's financial performance, and make informed decisions regarding investments and management strategies. Understanding these percentages plays a key role in evaluating the operational efficiency of the asset and ensuring that it meets financial benchmarks.