Property Valuation
What is 'economic rent' and how does it compare to 'contract rent' in a Delaware lease?
AEconomic rent is always lower than contract rent
BEconomic (market) rent is what the property could command today; contract rent is the actual rent specified in the lease — they may differ if the lease was signed in a different market✓ Correct
CBoth terms mean the same thing in current appraisal practice
DEconomic rent includes operating expenses; contract rent is just the base rent
Explanation
Economic rent (market rent) is the current competitive market rate. Contract rent is the actual rent per the existing lease.
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