There are 3 types of commercial leases: Gross Lease (Full-Service Lease), Net Lease, and Modified Gross Lease, with Triple Net Lease and Modified Gross Lease being the most common.
Gross Lease (Full-Service Lease)
- All Inclusive
- Landlord pays for most all expenses on the property, including:
- Taxes
- Insurance
- Maintenance
- Excess utility consumption is sometimes charged back to tenant
- Tenant pays their own insurance and taxes
Net Lease
- All Inclusive
- Tenant pays a pro-rated payment of certain expenses, including:
- Real Estate Taxes
- Property Insurance Taxes
- Common Area Maintenance items (CAMS), such as:
- Janitorial Services
- Property Management Fees
- Sewer
- Water
- Trash Collection
- Landscaping
- Parking Lots
- Fire Sprinklers
- Any Commonly Shared Area or Service
- Click below to read more about the 3 variations of the net lease:
Net Lease
- All Inclusive
- Tenant pays a pro-rated payment of certain expenses, including:
- Real Estate Taxes
- Property Insurance Taxes
- Common Area Maintenance items (CAMS), such as:
- Janitorial Services
- Property Management Fees
- Sewer
- Water
- Trash Collection
- Landscaping
- Parking Lots
- Fire Sprinklers
- Any Commonly Shared Area or Service
- Click below to read more about the 3 variations of the net lease:
Modified Gross Lease
- Rent is requested in one lump sum and includes:
- Property Taxes
- Insurance
- CAMS
- Tenant pays the costs of janitorial services and utilities
- Tenant pays fixed amounts for certain services on top of rent for the actual lease space
- Gross Up: If the building is less than 90-95% occupied, then expenses are still calculated for the tenants pro-rated share of operating expenses
