Portfolio Strategy Advisor

Analysis: 2026-2028 = 80% of portfolio expires (concentration risk)

Expiry Cliff

Definition: Concentration of lease expiries in a single year or short period.

Red Flag Threshold: >30% of SF expiring in one year

Risk:

• Multiple vacancies simultaneously
• Limited re-leasing capacity
• Market timing risk (downturn = high vacancy)
• Cash flow disruption
• Property value decline

Mitigation: Stagger lease maturities, prioritize early renewals

Renewal Priority Scoring

Factors:

1. Tenant Quality (credit strength)
2. Rent vs. Market (above/below market)
3. Space Suitability (tenant fit for space)
4. Lease Expiry (urgency)
5. Strategic Value (anchor, synergy)

Scoring Matrix:

Factor              | Weight | Score (1-5) | Weighted
--------------------+--------+-------------+---------
Tenant Credit       | 30%    | 4           | 1.2
Market Rent Gap     | 25%    | 3           | 0.75
Strategic Value     | 20%    | 5           | 1.0
Expiry Urgency      | 15%    | 2           | 0.3
Space Fit           | 10%    | 4           | 0.4
--------------------+--------+-------------+---------
Total               | 100%   |             | 3.65

Priority Tier: HIGH (score > 3.5)

Vacancy Forecasting

Assumptions:

• Historical retention rate (e.g., 70%)
• Market conditions (improving/declining)
• Re-leasing timeline (6-12 months)
• New tenant concessions (TI, free rent)

Forecast:

2025 Expiries: 50,000 sf
Expected Renewals (70%): 35,000 sf
Expected Vacancies: 15,000 sf
Downtime: 9 months average
Revenue Loss: 15,000 sf × $15/sf × 0.75 years = $168,750

Methodology

Step 1: Build Rollover Schedule

Extract from lease abstracts:

• Tenant name
• Suite/unit
• Rentable area (SF)
• Current rent ($/SF)
• Lease expiry date
• Renewal options (Y/N, notice deadline)

Create timeline (by year or quarter)

Step 2: Identify Expiry Cliffs

Calculate annual SF expiring:

Year | SF Expiring | % of Total

Red Flag: Any year > 30% of portfolio

Action: Prioritize early renewal negotiations for cliff years

Step 3: Score Renewal Priorities

For each expiring lease, assess:

1. Tenant credit quality
2. In-place rent vs. market rent
3. Strategic importance
4. Likelihood of renewal
5. Time to expiry

Assign priority tier: High / Medium / Low

Step 4: Develop Renewal Strategy

High Priority:

• Engage 18-24 months before expiry
• Offer attractive renewal terms (market or slightly below)
• Minimize downtime risk

Medium Priority:

• Engage 12 months before expiry
• Market terms
• Re-lease if tenant declines

Low Priority:

• Engage 6-9 months before expiry
• Above-market renewal terms or re-lease
• Opportunity to upgrade tenant mix

Step 5: Forecast Vacancy & Revenue

Assumptions:

• Renewal rate by priority tier
• Downtime for non-renewals
• Market rent for new leases
• Concessions for new tenants

Forecast cash flows for next 3-5 years

Key Metrics

Weighted Average Lease Term (WALT)

Formula:

WALT = Σ (Remaining Lease Term × Annual Rent) ÷ Total Annual Rent

Example:
Tenant A: 3 years remaining, $100K/year → 3 × $100K = 300
Tenant B: 5 years remaining, $200K/year → 5 × $200K = 1,000
Total Annual Rent: $300K
WALT = (300 + 1,000) ÷ 300 = 4.33 years

Interpretation:

• WALT > 5 years: Stable cash flow
• WALT 3-5 years: Moderate stability
• WALT < 3 years: High rollover risk

Retention Rate

Formula:

Retention Rate = Renewed SF ÷ Expiring SF

Example:
2024 Expiries: 50,000 SF
Renewals: 35,000 SF
Retention: 35,000 ÷ 50,000 = 70%

Benchmarks:

• Office: 60-70%
• Industrial: 70-80%

Expiry Concentration Index

Formula:

ECI = (SF Expiring in Peak Year) ÷ Total Portfolio SF

Example:
Peak year expiries: 100,000 SF
Total portfolio: 250,000 SF
ECI = 100,000 ÷ 250,000 = 40%

Risk Levels:

• <20%: Low risk (well-staggered)
• 20-30%: Moderate risk

• 30%: High risk (expiry cliff)

Red Flags

Expiry Cliff Risk

40%+ of SF expiring in one year:

• Mass vacancy risk
• Action: Accelerate renewal negotiations, offer concessions to retain

Low WALT (<3 years)

Insufficient lease term remaining:

• Refinancing challenge (lenders want WALT > 5 years)
• Property valuation risk
• Action: Extend lease terms proactively

Below-Market Rent Concentration

50%+ of tenants paying below market:

• Mark-to-market opportunity BUT renewal risk
• Tenants may vacate if pushed to market
• Action: Gradual rent increases, stagger renewals

Weak Tenant Credit Concentration

30%+ of rent from C/D credit tenants:

• Default risk
• Action: Diversify tenant mix, require guarantees

Integration with Slash Commands

This skill is automatically loaded when:

• User mentions: portfolio, rollover, expiry cliff, renewal priority, vacancy forecast
• Commands invoked: /rollover-analysis
• Reading files: Portfolio lease schedules, rent rolls

Related Commands:

• /rollover-analysis <portfolio-data-path> - Analyze lease expiry timeline and renewal priorities
• /renewal-economics <current-lease-path> - Renewal vs. relocation NPV for individual leases

Examples

Example 1: Industrial Portfolio Rollover Analysis

Portfolio: 5 industrial buildings, 500,000 SF total, 25 tenants

Rollover Schedule:

Year | Expiring Leases | SF      | % Total | Cumulative
-----+-----------------+---------+---------+------------
2025 | 3 tenants       | 75,000  | 15%     | 15%
2026 | 8 tenants       | 200,000 | 40%     | 55%  ← CLIFF
2027 | 5 tenants       | 100,000 | 20%     | 75%
2028 | 4 tenants       | 75,000  | 15%     | 90%
2029+| 5 tenants       | 50,000  | 10%     | 100%

Analysis:

EXPIRY CLIFF IDENTIFIED