Which of the following is not a component of the default Free Rent formula in ARGUS Enterprise?

The Free Rent formula in ARGUS Enterprise typically includes components that reflect the lease structure and adjustments associated with free rent periods. The components such as CPI (Consumer Price Index), Fixed Steps, and Free Rent itself directly relate to how the rental income is structured over the lease term, including how increases in rent might be calculated over time.

The CPI component allows adjustments based on inflation, aligning rental increases with economic changes. Fixed Steps denote predefined rent increases at specified intervals. Free Rent is clearly a central element, representing periods where no rent is collected.

Operating Expenses, however, are not a part of the Free Rent formula as they pertain to costs associated with running the property rather than the rent structure. These expenses are typically treated separately in financial modeling to assess the net operating income (NOI), which influences cash flow analysis but does not directly factor into how free rent periods are calculated or represented in the rental income formula.

Therefore, the absence of Operating Expenses from the Free Rent formula aligns with the purpose of differentiating between income (i.e., rent components) and expenses, emphasizing that Operating Expenses do not influence the calculation of the Free Rent period within the lease structure.