Industrial Scenario

In this example 2 warehouse properties are being compared in Pleasanton, California.

In the particular case, after the alternatives were compared, the difference was calculated using LseMod's Calculate Totals command. Dynamically linked, if a change is made to one property, the Management Summary is automatically updated.

LseMod is a decision analysis tool! A number of metrics can be used to reach a decision. They include:
  • First year cost,
  • Net present value,
  • Total cost,
  • Other Factors such as number of dock high doors, clear height, and
  • Other (aka for political reasons).

The classic approach is to make an economic decision based on the Net Present Value of the Occupancy Cost. Sometimes the decision may be based on the Total Cost or the First Year Cost which is typically highest since it includes one-time costs.

In our experience, the Other Factors such as number of dock high doors, clear height, etc. are as important as Costs, and LseMod let's you compare these factors side-by-side! (See Mgmt Summary sheet)

Then again, the decision may be political such as location relative to senior management's home.

LseMod quantifies each of the different parameters outlined above on the Management Summary (Mgmt Summary sheet) and even if the least cost solution is not selected, management knows the relative cost differential for whichever property is selected.

Taking the analysis a step further, LseMod compares the total occupancy cost. More than "just comparing rent", occupancy cost includes expenses like moving, construction, racks, consultants, security systems, etc.

Of course, you can just do the minimum since the ONLY required fields are rent, square footage, and lease term.