---
title: "Operating expense cap — Class A Atlas glossary"
description: "Annual cap on the tenant's share of building operating expenses."
canonical: https://classa.info/glossary/opex-cap
pageType: glossary
lastUpdated: 2026-04-01T00:00:00.000Z
license: "CC BY 4.0 with attribution to Class A Atlas (https://classa.info)."
---

> Annual cap on the tenant's share of building operating expenses.

## TL;DR

- Annual cap on the tenant's share of building operating expenses.
- Caps prevent runaway opex pass-throughs in inflationary environments.

# Operating expense cap

*Leasing · US, EU*

## Short definition

Annual cap on the tenant's share of building operating expenses.

## Full definition

Caps prevent runaway opex pass-throughs in inflationary environments. Most aggressive structure: cumulative compound cap (e.g., 4% per annum, compounded). Most landlord-friendly: non-cumulative annual cap.

## Why this matters for Class A leasing

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

## 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.

---

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