A
A negotiated sales threshold above which a tenant begins paying percentage rent, set below the natural breakpoint rather than calculated from it.
An artificial breakpoint is a negotiated sales threshold above which a tenant begins paying percentage rent. Unlike a natural breakpoint, it is not calculated directly from minimum rent and the percentage rent rate — the amount is specifically stated or negotiated in the lease.
If a lease establishes an artificial breakpoint of $2 million and percentage rent of 5%, percentage rent generally becomes applicable to eligible sales above $2 million, subject to the lease terms.
Teams need to validate the breakpoint, applicable sales definition, exclusions, reporting periods and percentage rate before calculating rent.
REAL
REAL extracts and structures this field from your documents so your team can act on it — no manual abstraction required.