O&M: Operating and Maintenance Expenses in Commercial Real Estate

What is O&M in Commercial Real Estate?

O&M refers to operating and maintenance expenses, such as property and liability insurance premiums, utility installation charges and deposits, maintenance equipment, purchase of office equipment and furniture, congregate items, advertising expenses, management fees, etc. The O&M can account for up to 50% of a building's lifecycle costs. Instituting a rigorous O&M program not only greatly reduces work site risk and unplanned expenses due to operational faults, but also increases the longevity of real estate assets. 

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