What Is So Gross About My Lease?
A question I get asked fairly frequently from business owners is what does it mean for a lease to be “gross”? This is a common term in commercial real estate. It doesn’t meant that your lease smells funny, has stuff oozing out of it, or anything like that… A pretty good textbook definition is that a gross lease is one in which the landlord pays all expenses associated with the ownership of the property including maintenance, taxes, and insurance. Basically, with a gross lease a tenant pays their monthly rent and the landlord pays all associated expenses with the property. This arrangement is usually found in office buildings and buildings with many small tenants. It’s a simple way of calculating a rental rate. The “opposite” (for lack of a better word) of a gross lease is a triple net lease. What is that all about? Three nets??? Basically a textbook definition of a triple net lease is one in which the tenant pays rent to the landlord, as well as a share of the taxes, maintenance, and
