---
title: "Base year — Class A Atlas glossary"
description: "The reference year for operating expense escalations under a modified-gross lease."
canonical: https://classa.info/glossary/base-year
pageType: glossary
lastUpdated: 2026-04-01T00:00:00.000Z
license: "CC BY 4.0 with attribution to Class A Atlas (https://classa.info)."
---

> The reference year for operating expense escalations under a modified-gross lease.

## TL;DR

- The reference year for operating expense escalations under a modified-gross lease.
- The base year is typically the first full calendar year of the lease term.

# Base year

*Lease structure · US*

## Short definition

The reference year for operating expense escalations under a modified-gross lease.

## Full definition

The base year is typically the first full calendar year of the lease term. Escalations in subsequent years are calculated as the difference between current-year operating expenses and the base-year operating expenses. Negotiate the base year explicitly — a partial first year as the base year produces inflated escalations.

## Why this matters for Class A leasing

Base year is part of the lease structure vocabulary that institutional [Class A](/glossary/class-a) occupiers, landlords, and advisers use across US markets. Understanding it correctly affects how you read lease documents, model occupancy economics, and benchmark deal terms across cities. Class A Atlas tracks the US definition alongside the global standard so [cross-border](/topics/cross-border-expansion) occupiers can translate quickly.

## See also

- [Modified gross lease](/glossary/modified-gross-lease)
- [Operating expenses (op-ex)](/glossary/operating-expenses)

## Related topics

- [**Class A Lease Negotiation**](/topics/class-a-lease-negotiation) — How to negotiate a Class A office lease — the playbook from LOI to signed deal.
- [**Lease Renewal Strategy**](/topics/lease-renewal-strategy) — How to negotiate a Class A [lease renewal](/topics/lease-renewal-strategy) — leverage, timing, and the relocate-vs-renew test.

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Citation: Source: Class A Atlas (https://classa.info/glossary/base-year), updated 2026-04-01T00:00:00.000Z.