Is a higher WAULT always better?

Not necessarily. A higher WAULT means steadier income and lower near-term leasing risk, which suits core and long-income strategies. Value-add investors may prefer shorter terms so they can re-let and grow rent. The right level depends on the strategy.

Should I use WAULT to expiry or WAULT to break?

Quote both. WAULT to break is the more conservative figure because it assumes tenants leave at the earliest opportunity; investors and lenders focus on it. A large gap between the two signals concentration of break options.

How do I calculate WAULT for my portfolio?

Weight each lease's unexpired term by its contracted rent (or floor area), sum, and divide by the total weighting. You can use the free STREETS WAULT calculator to do it instantly.

Reference

What is a good WAULT? Benchmarks and how to read it

Q: What is a good WAULT?

There is no universal figure. Many institutional investors regard a commercial WAULT comfortably above five years as healthy and under three years as needing active leasing attention, but it is highly sector- and strategy-dependent: long-income strategies prize very long WAULTs, while value-add strategies accept shorter ones deliberately.

WAULT signals income durability, so higher is usually better - but the right level depends on sector, strategy and cycle. Here is how to judge it, with a worked example.

There is no single 'good' WAULT

WAULT — the rent-weighted average unexpired lease term — is a measure of income durability, so a higher number usually signals steadier income and lower near-term leasing risk. But the right level depends entirely on sector, strategy and where you are in the cycle.

As a rough guide, many institutional investors regard a commercial WAULT comfortably above five years as healthy, and something under three years as a portfolio that needs active leasing attention. Long-income and core strategies prize very long WAULTs; value-add strategies deliberately accept shorter ones because the plan is to re-let and grow rent. Sector matters too: hyperscale data-centre and ground leases can run decades, logistics is often long, while retail and flexible office are structurally shorter.

A worked example

Take three leases: a retail unit at CHF 250,000 rent expiring 30 Jun 2032 with a 2029 break; an office at CHF 180,000 expiring 31 Dec 2028; and a logistics unit at CHF 320,000 expiring 31 Mar 2035 with a 2030 break. Weighted by rent, that portfolio has a WAULT to expiry of about 6.3 years and a WAULT to break of about 3.2 years.

The gap between the two numbers is the story: 6.3 years looks comfortable, but if every tenant exercised its break the effective term is only 3.2 years. That is why investors and lenders look at WAULT to break, not just to expiry. Run your own leases through the free WAULT calculator to see both.

How to read it well

Always quote WAULT to break alongside WAULT to expiry, and say whether it is weighted by rent or floor area. Watch what is pulling it down — a single large lease approaching expiry can move a portfolio number sharply. And keep it current: WAULT changes every time a lease is signed, renewed or broken, which is exactly why keeping it accurate across a portfolio by hand is hard.

For the wider set of measures this sits within, see our guide to key real estate asset management metrics, or the definition in the glossary.

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