When considering commercial properties for your new office, you should find out the type of commercial lease being offered. This is because the type of lease will determine how your rent will be calculated and any other obligations under it.
Generally, there are four distinct types of leases, which are:
In this case, the tenant pays basic rent. The property owner covers all operating expenses for the commercial property, including maintenance, utilities, real property taxes and landlord insurance.
Triple net lease
For this net lease, the building occupant has to pay for some expenses of the property in addition to the gross rental. These expenses include property taxes, landlord’s insurance, and maintenance and upkeep costs.
Absolute net lease
The tenant is responsible for all maintenance and real estate operating costs of the property.
Modified gross lease
For a modified gross lease agreement, tenants pay the rent plus a portion of the incurred operating expenses. How these expenses are calculated, and split varies depending on the lease terms.