What do all the different lease types mean?
asked 2011-12-30 11:41:13 -0500
Can someone explain the difference between net leases and full service leases?
asked 2011-12-30 11:41:13 -0500
Can someone explain the difference between net leases and full service leases?
answered 2011-12-30 18:14:33 -0500
The different lease types define the responsibilities of the landlord and the tenant. A full service or gross lease puts most of the operating expenses and responsibility on the landlord while a net lease puts the responsibility on the tenant. Here are some descriptions of the different types of net leases:
Single Net Lease – A single net lease is a net lease where the tenant agrees to pay a monthly lump sum base rent as well as the property taxes. The landlord is responsible for all other operating expenses of the premises.
Double Net Lease (NN) – A double net lease is a net lease where the tenant agrees to pay a monthly lump sum base rent as well as the property taxes and the property insurance. The landlord is responsible for all other operating expenses of the premises.
Triple Net Lease (NNN) – A Triple net lease is a net lease where the tenant agrees to pay a monthly lump sum base rent as well as the property taxes, the property insurance, and the maintenance. Under a triple net lease there are a few legal defenses which may relieve a tenant of his responsibilities. For example, a triple net lease may relieve the tenant of his responsibility if the property is subject to an eminent domain proceeding.
Absolute Triple Net Lease (Bond Lease) – An absolute triple net lease is a net lease where the tenant agrees to pay a monthly lump sum base rent as well as the property taxes, the property insurance, and the maintenance. Under an absolute triple net lease there are no legal defenses if a tenant fails to meet his responsibilities.
answered 2011-12-30 18:53:09 -0500
Here are a few more definitions.
Full Service Rent
An all-inclusive rental rate that includes operating expenses and real estate taxes for the first year. The tenant is generally still responsible for any increase in operating expenses over the base year amount.
Gross Lease
A lease in which the tenant pays a flat sum for rent out of which the landlord must pay all expenses such as taxes, insurance, maintenance, utilities, etc.
A modified gross lease or modified net lease is a hybrid of a gross and net lease.
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Asked: 2011-12-30 11:41:13 -0500
Seen: 94 times
Last updated: Dec 30 '11
