Operating Expense (Noun)
Meaning
The expense of maintaining property (e.g., paying property taxes and utilities and insurance); it does not include depreciation or the cost of financing or income taxes.
Classification
Nouns denoting possession and transfer of possession.
Examples
- The company's operating expense for the building was substantial, covering property taxes, insurance, and maintenance costs.
- To determine the operating expense, the landlord included the costs of utilities, repairs, and property management fees.
- The annual operating expense for the office building was approximately $100,000, not including mortgage payments or depreciation.
- Property owners must factor in operating expenses, such as insurance premiums and utility bills, when calculating their net operating income.
- The property manager estimated that the operating expense for the new complex would be higher than usual due to its advanced security systems and energy-efficient features.