Which of the following is NOT typically included in Operating Expenses?

Operating expenses are the costs required to run and maintain a property on an ongoing basis. These typically include costs such as utilities, real estate taxes, and insurance. However, depreciation costs are typically excluded from operating expenses.

Depreciation is an accounting method used to allocate the cost of a tangible asset over its useful life. It reflects the wear and tear on the property, but it does not involve an actual outlay of cash in the period it is recorded. Therefore, it is not considered an operating expense, which represents actual cash flow associated with the day-to-day operations of the property. This distinction is critical in understanding how expenses are categorized in property management and accounting.