Net Lease

A commercial lease where the tenant pays base rent plus pays for its pro rata share of some or all operating expenses related to the tenant’s occupancy of the space. Types of net leases include single net, double net, triple net, and absolute triple net. Expenses may be billed directly to the tenant, or the expenses may be paid by the landlord and reimbursed by the tenant. Net leases contrast with Gross Leases, wherein the landlord pays for all operating expenses.

Single Net (N): a net lease where the tenant pays base rent plus pays for one of the operating expense items such as common area maintenance (CAM), insurance, or property taxes

Double Net (NN): a net lease where the tenant pays base rent plus pays for property insurance and property taxes

Triple Net (NNN): a net lease where the tenant pays base rent plus pays for all operating expenses

Absolute Triple Net: a type of triple net lease where the tenant pays base rent, all operating expenses, plus pays a portion or all of the capital expenditures to maintain the condition property