Your facility budget is more than just rent. Between CAM charges, utilities, insurance, janitorial services, and amortized move-in costs, the true monthly cost of operating a school building can be 40-60% higher than the base rent alone. This checklist helps you identify every recurring facility expense so nothing catches you off guard. Use it alongside your lease terms to build a complete picture.
Base Rent
The core rental payment to the landlord.
Monthly base rent calculated (annual rate / 12)
Annual escalation rate noted and future years projected
Any free rent or abatement period identified
CAM & Operating Expenses
Common Area Maintenance and building operating costs.
Monthly CAM charges calculated
CAM cap or controllable expense limit identified
Property tax pass-through amount determined
Building insurance pass-through amount determined
Utilities
Monthly utility costs for the space.
Electric cost estimated (request utility history from landlord)
Once you have identified all your monthly facility costs, calculate your total facilities margin as a percentage of revenue:
Total facilities margin = (Debt Service + M&O) / Total Revenue
Target benchmarks:
Total facilities margin: 20-24% of recurring public revenue
Debt service alone: 14-16% of revenue
M&O alone: 6-8% of revenue
Maximum Annual Debt Service (MADS): Less than 15% of total revenue
These are industry benchmarks, not a verdict on your plan. If your numbers run above them, it is a cue to revisit space requirements, negotiate lease terms, explore alternative properties, or line up philanthropic support during enrollment growth years. To pressure-test whether a specific facility cost is sustainable inside your full revenue model, use SchoolStack Budget.
Frequently asked questions
How much more than rent does it cost to operate a school building?
The true monthly cost of operating a school building is typically 40-60% higher than base rent alone. Additional costs include NNN charges (taxes, insurance, CAM), utilities, janitorial services, maintenance, insurance, and amortized one-time costs like furniture and technology.
What is a healthy facilities margin for a school?
Target a total facilities margin of 20-24% of recurring public revenue, broken into 14-16% for debt service and 6-8% for maintenance and operations. Maximum Annual Debt Service should stay below 15% of total revenue.