Commercial Leasing Mastery
01 · 34Free preview

Face rent vs effective rent

01 · Commercial lease fundamentals · Masterclass · 14 min

Every lease has two prices: the face rent everyone quotes and the effective rent everyone actually pays. Confusing the two is how new agents overprice stock and underprice their own commission expectations.

Why face rent lies

Face rent is the headline figure written into the lease — say $700/sqm net for a CBD office floor. It is what appears in the agency agreement, the marketing material and the landlord's rent roll. But it says nothing about what the tenant actually contributes to the landlord's cash flow once you net off what the landlord had to give away to get the deal signed.

Landlords protect face rent because it sets the benchmark for the next review, the next valuation and the next tenant's negotiation. A landlord who drops face rent from $700 to $600 has reset the market. A landlord who holds face rent at $700 but gives 12 months rent-free over a 5-year term has not reset anything on paper — even though the tenant is paying roughly the same net amount either way.

The rest of this lesson is for enrolled learners

34 lessons, scored knowledge checks and AI role-play — unlocked on enrolment.

Previews show the opening of the first lesson only. Enrol to continue this lesson, work through the full program at your own pace, and earn your completion certificate.

Version 2026-08-26.v1

48-hour written cancellation window · refund terms · secure checkout · instant access
Compare programs
Locked in this program
  • Gross, net and semi-gross — the three lease typesReading
  • Anatomy of a commercial leaseReading
  • Knowledge checkKnowledge check
  • Rent-free periods — the standard packageReading
  • Fit-out contributions and cash incentivesMasterclass
  • Scenario: The head tenant demands 40% incentiveAI role-play
  • Knowledge checkKnowledge check
  • Reading a tenant's financials in 15 minutesReading
  • Bank guarantees, personal guarantees and directors' guaranteesMasterclass
  • Knowledge checkKnowledge check
  • Scenario: Great rent, questionable tenantAI role-play
  • The Disclosure Statement — the document that trips up new agentsReading
  • Outgoings caps, ratchet clauses and market reviewsMasterclass
  • Knowledge checkKnowledge check
  • The institutional pitch deckMasterclass
  • The quarterly market report that keeps you retainedReading
  • Knowledge checkKnowledge check
  • Logistics and warehouse — the tenant demand storyReading
  • Industrial lease specifics: hardstand, height, hazmatMasterclass
  • Knowledge checkKnowledge check
  • Building the intelligence networkReading
  • The unsolicited landlord approachMasterclass
  • Knowledge checkKnowledge check
  • How an outgoings reconciliation actually worksMasterclass
  • The five grounds tenants actually dispute onReading
  • Make-good disputes — what 'as at commencement' really meansMasterclass
  • A tenant vacates with no condition report on fileAI role-play
  • Knowledge check: outgoings and make-goodKnowledge check
  • The four rent review mechanisms and how they interactMasterclass
  • The market review determination process, step by stepReading
  • Ratchet clauses and CPI reviews — the calculation trapsMasterclass
  • A tenant challenges the landlord's market review valuationAI role-play
  • Knowledge check: rent review and valuationKnowledge check