Leases on commercial properties fall into three main categories - triple net, gross and full service.

Triple net or NNN leases refer to the fact that the tenant pays its proportinate share of the landlord's expenses. The expenses are: (1) property taxes, (2) insurance and (3) common area maintenance (CAM), which may include landscaping, cleaning, parking lot sweeping or plowing, and utilities for commom areas. In a multi-tenant building, the costs are divided among the tenants based on the proportion of the total space the tenant occupies.

A gross lease is one in which the tenant pays just the rent and does not pick up landlord's costs.

A full service lease is one in which the tenant's rent covers the utilities that the tenant uses and often includes janitorial service. The tenant does not pay any of the landlord's expenses.

Leases frequently fall into variations of these three main types. For example, the lease might call for the tenant to pay a share of the CAM charges but not taxes or insurance. Or a full service lease may exclude janitorial services. These variations are why leases are sometimes called modified gross or modified full service or double net instead of triple net.

With the exception of full service leases, the tenant always pays for its own utilities. Also, in every cas the tenant always provides its own liability insurance and insurance on its personal property.

Because there are so many variations, it is always a good idea to check exactly what charges the tenant is expected to pay.

To see the properties we have for lease or for sale, please check our web site at www.modesto-commercial.com To contact me please email at rlroaks@prucommercialre.com or call 209-758-3147.

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