When should I use area×hours instead of simple area allocation?
Choosing the right allocation method ensures tenants pay a fair share of building costs. Here is when each method works best:
Use By Area when
- All tenants have similar operating schedules (e.g., all standard office hours)
- The building is single-use (all offices, all warehouses)
- Lease contracts specify area-based cost sharing
- Costs are not usage-dependent (insurance, property tax, fixed maintenance)
Use By Area × Hours when
- Tenants have significantly different operating hours
- The building is mixed-use — a retail centre with a 24/7 gym, a bakery open from 5 AM, and offices open 9–5
- Energy and utility costs are the main driver — heating, cooling, electricity, and ventilation all scale with operating hours
- You want a fairer split that reflects actual building usage
Real-world scenarios where Area × Hours makes a big difference
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Shopping centre: A convenience store open 7 days, 16 hours vs a specialist boutique open 3 days, 6 hours — the convenience store uses heating, lighting, and ventilation far more.
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Office building with a restaurant: The restaurant operates evenings and weekends while offices close at 17:00. Area × Hours ensures the restaurant pays a larger share of after-hours electricity and HVAC costs.
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Mixed commercial building: A gym (80 h/week), a law firm (45 h/week), and a pop-up shop (15 h/week) in equal-sized units. Pure area allocation splits costs equally. Area × Hours allocates 57%, 32%, and 11% respectively.
You can use different methods for different cost types. A common setup:
- Electricity, heating, cooling → By Area × Hours (usage-driven)
- Insurance, property tax → By Area (risk-based, not usage-dependent)
- Common area maintenance → By Area (corridor cleaning is area-proportional)
- Water → Custom factors (if specific tenants use much more water)
Where to configure: Cost Allocation → select building → choose a method per cost category using the allocation buttons at the top.