Cost Allocation by Square Footage Calculator

About this calculator

Cost allocation by square footage is the standard method landlords, property managers and cost accountants use to split a shared expense — rent, utilities, property tax, janitorial or common area maintenance (CAM) — among multiple tenants or departments in proportion to the floor area each one occupies. The core ratio is simple: a unit's share equals its square footage divided by the building's total leasable or occupied square footage, multiplied by the total cost. Commercial triple-net (NNN) leases typically add a gross-up step, prorating each tenant's share of common areas — lobbies, hallways, shared restrooms — on top of their private square footage.

Property managers use this method to bill CAM charges fairly across a shopping center or office building, while corporate accountants use the same logic internally to allocate rent or utility costs to departments sharing one facility, which matters for departmental budgeting and internal cost-center reporting. Because the split is driven entirely by area rather than headcount or usage, it works best for costs that genuinely scale with space — rent, property insurance, HVAC — rather than costs that scale with people or activity.

This calculator takes the total cost, each unit's square footage and the building's total area (with an optional common-area gross-up) and returns each tenant's or department's dollar share and percentage of the total.