Cost involved in property rental

• The landlord charges a fee for the drawing-up of the rental agreement
• Stamp duty, calculated on the whole lease value, currently R0.5 on every R100.
• Deposit options: normally 3 month's rental if the tenant don't sign personal surety and 2 month's rental if the tenant do sign surety.
• The first month's rental in advance.

The deposit options may differ from landlord-to-landlord.

Terms

Common Area
Spaces such as passages, lift lobbies, common kitchens/toilets, entrance foyers, etc. The tenant will normally pay for a percentage of the common area. Also see Usable/Rentable space

Common Factor
The percentage of the common areas that is calculated into the rental. Also see Usable/Rentable space.

Escalations
The gross rental will escalate on a annual basis the escalation rate will depend on the building/landlord. Escalation rates normally range from 10-13% per annum.

GLA (Gross Lettable Area)
This is the total area that is under roof. This term is mostly used in the sale of property. Also see Useable/Rentable space.

Gross Rental
The total rental charged. This will normally include security costs, sewage, refuse, rates and taxes, etc. The gross rental is made up of net rental and operating costs, the last mentioned is the portion of the rental that is allocated to the maintenance and running of the property. The gross rental excludes VAT and electricity/water consumption consumption.

Parking ratio
The is the number of parking bay's the tenant can rent in relation to the space they occupy. For example if the parking ratio is 4/100 the tenant can only rent 4 parking bays for every 100m² let. However in most cases the buildings have more than enough additional parking and normally the landlord will be able to satisfy the tenant's parking requirements even if it exceeds the parking ratio. Also bear in mind that the tenant is under no obligation to rent the total number of bays as per the parking ratio.

TIA (Tenant Installation Allowance)
An allowance the landlord gives the tenant towards renovations/alterations on the leased premises. This allowance is normally only given on a three year or longer rental agreement. The rate can be given as a rate per square meter or as a rent free period.

Useable/Rentable space
Rentable space is broken up into usable and rentable space. When renting space, the building will normally have common areas, like passages, staircases, common toilets/kitchens, lift lobbies, etc. When renting space the total space rented will include a percentage of the common area. To illustrate: if you were to rent a 500m² office and the common factor is 12% then the rentable space will be 500m² and he usable space 440m²