Market rent is what a commercial space would likely lease for today in an open market, on typical terms. To estimate it, collect recent leases of similar space nearby, adjust them for differences from your property, and cross-check against asking rents and the property's own leasing history.
Three ways to estimate it
- Comparable leases. Recent signed leases for similar space. The strongest evidence, because the rent is real.
- Asking rents. What owners want for vacant space now. Useful as a ceiling and a trend, but not what was signed.
- The property's own history. What new leases at this building achieved recently, if there were any.
Adjust before you average
Adjust each comparable for what makes it different from your space: size, floor or frontage, condition, location, and lease terms. Convert everything to the same basis, such as annual rent per square foot net of recoverable expenses.
A worked example (hypothetical numbers)
A 12,000 sq ft retail space. Four recent leases, in annual rent per square foot, with adjustments for location and condition:
| Comparable | Signed rent | Adjustment | Adjusted rent |
|---|---|---|---|
| 1 | 28.00 | +0.00 | 28.00 |
| 2 | 31.00 | -1.50 | 29.50 |
| 3 | 30.00 | +0.50 | 30.50 |
| 4 | 34.00 | -2.50 | 31.50 |
The average adjusted rent is 29.88. For 12,000 sq ft, that is about 358,500 a year. The four comparables are invented; in practice you would also weight the closest or most recent lease more.
Common mistakes
- Using asking rent as if it were signed rent.
- Ignoring free rent and tenant allowances.
- Mixing gross and net leases in one average.
- Using too few comparables, or only old ones.
- Applying a residential rent to commercial space, or the reverse.
What a rent estimate does not replace
It is an estimate of what the market would pay, not a guarantee of what a tenant will sign. It does not replace a broker's local knowledge or a licensed appraisal. Titleman's rent run shows the comparables behind its figure, with a median of about 16 minutes (30 days to 18 October 2026); it does not give a final price. For the comparables themselves, see what comps are.
Read next: net operating income and what an automated valuation model is.
Common questions
What is market rent? The rent a property would likely achieve if it were offered for lease today in an open market, on typical terms. It differs from contract rent, which is what a tenant pays under a lease signed earlier, possibly in a different market.
What is the best way to estimate market rent? Use recent leases of similar space nearby, adjusted for size, condition, location and lease terms, then cross-check with asking rents and with what the property's own recent leases achieved. No single source is enough.
Why do lease terms matter as much as the rent figure? A rent of 30 per square foot with a long free-rent period and a large tenant allowance is worth less than 28 with none. Compare rents on the same basis, such as net effective rent, or the numbers do not line up.
How long does a Titleman rent run take? Titleman measured a median of about 16 minutes for a rent run over the 30 days to 18 October 2026. The run shows the comparables used, so you can check which ones drive the figure.
Published by Titleman, which makes the AI engine mentioned on this page. Written by the Titleman team with AI assistance. Updated 19 October 2026.