RUBS

RUBS allows landlords to bill back utility costs (water, trash, sometimes electricity) to tenants on a property that has master metering rather than individual meters. Allocation is based on unit square footage, number of occupants, or a flat split. RUBS can add $50-$150 per unit per month to effective rent, reducing the owner's utility burden and improving NOI. At a 7.5% cap rate, $100/unit RUBS on a 12-unit property adds $16,000 NOI and $213,000 in value. RUBS implementation is a standard forced-appreciation lever in value-add multifamily deals that are often acquired via seller financing.