Consider the following 3 leases for the next 3 years with a 12% discount rate. Lease #1; Flat gross rent is $61/sqft. Owner pays operating expenses which are $12 in first year and increase $2/year thereafter Lease #2; Indexed gross rent is $59/sqft in first year, goes up 8% per year to match inflation. Owner pays operating expenses which are $11 in first year and increase $3/year thereafter. Lease #3, Flat gross lease of $57.50 with expense stop. Operating expenses are $11.50/sqft in first year and an increase $2/year. However, owner's expense is limited to $13/year with tenant paying the difference