Lease escalation: see the whole payment path.

Identify what increases and when

Record whether the offer uses fixed dollar steps, a recurring percentage, an index reference or another mechanism. Identify the starting payment, adjustment date and cost component affected. Do not assume a base-rent increase also changes estimated operating costs by the same amount.

For fixed steps, enter the supplied schedule directly. For percentage scenarios, state whether changes compound on the previous year’s rate. For an index-linked arrangement, preserve the actual series and calculation wording as questions for document review.

Hypothetical example: a fixed annual percentage

Assume a hypothetical 5,000-square-foot unit begins at $20 base rent per square foot annually. The rate rises by 3% at the start of each subsequent year for a five-year term. Annual base payments are $100,000, $103,000, $106,090, $109,272.70 and $112,550.88.

The five-year base total is $530,913.58, compared with $500,000 at a flat rate. If additional rent is assumed constant at $6 per square foot annually, it contributes another $150,000. This scenario excludes tax, incentives, outside expenses and discounting; it does not predict future market rents.

Separate known terms from stress tests

Use the documented offer as the central schedule. Add alternative operating-cost or index assumptions only as labelled scenarios. A stress test asks what the budget would look like under a chosen input; it is not evidence that the input will occur.

Show the payment in each year, total undiscounted cost and the final-year monthly equivalent. If two proposals have different terms, avoid comparing raw totals as though the lengths matched. Use a common comparison horizon only when its assumptions are clearly disclosed.

Keep index references precise

Statistics Canada’s escalation guide highlights the importance of specifying the series, comparison periods, adjustment timing and treatment of revisions. Save the relevant table reference and the values actually used in a calculation.

For analysis, note any floor, cap or limited portion of rent that is adjusted. These features change the arithmetic and cannot be inferred from a general description such as inflation-linked. Interpretation of the contractual wording requires its own review.

Use the schedule to plan decisions

Look for years where the assumed rent path makes the budget tight. Compare those years with staffing, equipment, expansion and other committed spending. A payment schedule is especially useful for identifying when a decision needs more financial flexibility.

Keep the current proposal and scenario outputs versioned. Update the calculation when a documented offer changes, while retaining the earlier assumptions. This creates a readable record of why the preferred option changed rather than an isolated total with no explanation.

Sources and scope.

• Statistics Canada — Price Adjustment Guide for Contract Escalation ↗
• Statistics Canada — Commercial rents services price index, monthly, table 18-10-0255-01 ↗

Sources checked 12 October 2026. Numerical examples are hypothetical; figures from the official index carry their published source period.

Questions worth asking.