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Retail is becoming a standard on the bottom floor of apartment communities, and while the storefront looks like any other, there are key differences in how the operations expenses, like property taxes and insurance are charged for retailers in apartment communities versus shopping centers.

“Operating expenses in a multi-family project that are passed-through to the retailer should be dealt with differently than in a conventional shopping center because many of these expenses do not benefit the retail tenants,” Gary Glick, a partner with Cox, Castle & Nicholson, tells GlobeSt.com. Glick says that there are two standard ways to properly cover operating expenses. One it is the pro rata share of all of the operating expenses for the multifamily project and the other is by reasonably allocating operating expenses attributed to the retail tenants.

Kelsi Maree Borland

Kelsi Maree Borland is a freelance journalist and magazine writer based in Los Angeles, California. For more than 5 years, she has extensively reported on the commercial real estate industry, covering major deals across all commercial asset classes, investment strategy and capital markets trends, market commentary, economic trends and new technologies disrupting and revolutionizing the industry. Her work appears daily on GlobeSt.com and regularly in Real Estate Forum Magazine. As a magazine writer, she covers lifestyle and travel trends. Her work has appeared in Angeleno, Los Angeles Magazine, Travel and Leisure and more.

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