What is the difference between a “Triple Net” lease and a “Gross” lease?
TThe abbreviated answer to this question is: surprisingly little. But as they say, “The Devil’s in the Details.” At the most basic analysis the differences appear to be rather stark: under a triple-net lease the tenant pays for all property taxes, property insurance and property maintenance directly. With a gross lease the landlord pays for these items. The first instinct of every tenant then is to opt for a gross lease. But just because a landlord is paying for these expenses directly does not mean you are getting a better deal: you can bet that every penny of those expenses has been incorporated into the higher gross rental rate you will be paying. What is the biggest single risk to a gross lease? In our experience it concerns the difference in motivation to perform necessary maintenance during the life of a lease. Even if a landlord is generally cooperative, how can you assure that they will provide you the timely service you require when an emergency occurs? Consider a water main b
