If a Base Year Stop structure is applied, what will LB Corp reimburse for operating expenses in 2016?

In the context of a Base Year Stop structure in lease agreements, the landlord typically agrees to cover operating expenses up to a certain level, usually defined by the expenses incurred in a specific base year. Any operating expenses that exceed this base year threshold are reimbursed by the tenant.

If LB Corp's lease specifies a Base Year Stop and the operating expenses for 2016 do not exceed the amount defined in the base year, the tenant will not be required to reimburse for these expenses. In this scenario, if the calculated operating expenses for 2016 fall below or are equal to the base year figure, the reimbursement amount would indeed be $0.

This reflects common practices in commercial leasing, ensuring that tenants only pay a percentage of any increases beyond the predetermined base year expenses. If the Base Year Stop has set the threshold sufficiently low and the expenses in 2016 are in line with that figure, it becomes clear why the correct answer indicates that LB Corp will reimburse $0 for operating expenses in that year.