WALT — weighted average lease term — is the average remaining lease term across a property's tenants, weighted by each tenant's share of income.
WALT — weighted average lease term — is the average remaining lease term across a property's tenants, weighted by each tenant's share of income.
Each lease's remaining term is weighted by that tenant's proportion of total rent, then averaged. A large tenant with a long lease pulls WALT up more than a small tenant with the same term.
WALT is one of the primary determinants of a commercial property's cap rate and therefore its value. A long WALT means income certainty; a short WALT means imminent re-leasing risk — vacancy, incentives, capital expenditure, and uncertainty about the new rent.
Two identical buildings with different WALTs can be worth materially different amounts.
WALT is usually calculated to the lease expiry, not to the next break or renewal right. Check which basis is being quoted — a lease with a tenant's right to break in two years but a term running eight is not eight years of certain income.
Tenant quality matters as much as term. A long lease to a weak covenant is worth less than a shorter lease to a strong one — see tenant covenant.
Last reviewed: 1 August 2026 · General information only, not legal or financial advice.
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