7.8.4 Estimate of Operating Expenses by Units of Comparison

A. Items of expense shown under each comparable and the expense items applicable to the subject proposal must be expressed as suitable unit of comparison–such as expense per unit per annum (PUPA), and expense per square foot of net rentable area per annum (PSFPA), or percent of effective gross income. The expense comparables and units selected must be as similar as possible to the subject project and units as they relate to the subject location, structural type, number of bedrooms, and average unit size.

B. For consistency purposes, expense components must be expressed in the same units of comparison so that the expenses for the subject proposal can be totaled. In cases where the unit of comparison for a specific component is different from the basic unit of comparison for the other expense items, this different unit of comparison must be explained in the expense narrative. The dollar amount of the expense item can afterwards be converted to the same unit of comparison selected for the other expense components. Additional documentation must be submitted, as needed, for all component estimates that are not self-explanatory.