Pro rata

Pro rata CRE

To prorate (adjective pro rata) is to divide a value in proportion to some other value.

If a tenant were to move in mid-month (without that tenant receiving any rental holiday or beneficial occupation) that tenant’s gross rental could be pro-rated for the days they occupy their premises. That is, the tenant would pay only a percentage of their total gross rental. The percentage would be the days occupied vs the total days in the month.

Example one

Security expenses are shared pro rata, based on my percentage space occupied.

I occupy 500 sqm of 2,000 sqm premises (That 500 sqm is 25% of the 2,000 sqm total)

Security expenses are R12,000 per month.

My pro rata share of security expenses is 25% of R12,000 or R3,000.

Example two

My monthly license is charged pro rata, based on numbers days usage per month.

My license starts on the 10th of a 30 day month (The 10 days is 33.3% of the 30 day total)

License charges are R12,000 per month.

My pro rata license expense is 33% of R12,000 or R4,000.

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