Typical ROI on commercial lease

Does anyone have any guidelines when a a typical commercial lease is in the money?
Say you have to pay TIs, free rent, commissions etc so when should you expect the lease to recoup the initial investment after 6 months, one year?
two years?

Does it change if it is is a mom and pop tenant or a national tenant?

Thanks
Jim

Sounds like typical income & expense itemization. Cash-on-cash return will give you an idea of the “velocity” of your money, ie, how fast you would recoup your initial investment if you meet or exceed that. But be careful to remember that there are 2 ROI’s, not just 1. There is Return On Investment that you mention and there is Return Of Investment which I got burned on earlier in my career. You can have a great Return On Investment while you hold the property but if you have to resell for a lot less than you bought it for, your Return Of Investnent will suck and drag down your total return. Ask me how I know that :slight_smile:

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