You’ve decided you want to lease a space for your business, và your realtor presents you with a lease amount that says NNN. What does NNN mean? How is it different from another option called a gross lease? Is one better than the other? Let’s look at the difference, because it’s is always good know what you are talking about before you actually compare.An NNN lease is the most common type of commercial lease and is commonly called a triple net lease. On an NNN lease, tenants pay additional expenses in addition lớn the lease fee, to lớn the landlord or lessor. The NNN fees includes property taxes, property insurance và common area maintenance for a building (CAM). How is this figured? The landlord uses the amount of annual costs and divides it by the total number of rental square footage in the building. The landlord includes the totals for property taxes, insurance, maintenance và common area upkeep và then divides the sum by 12 khổng lồ arrive at a monthly cost.For example, if a Cedar Rapids commercial real estate lease is quoted as $14 NNN. This means that in addition to lớn the $14 square foot yearly rate you are also responsible for paying the taxes, insurance, & common area maintenance fees. In this example assume the taxes are $7 square foot per year, the property insurance is $0.40 per year và the CAM is $3.00 square foot per year. Based on those numbers your total yearly rent would be $24.40 per square foot per year. If you are leasing 4,000 square foot your yearly rent would be $97,600 or $8,133.33 monthly rent.So, what is gross lease? Gross rate or full-service rate includes everything; taxes, insurance, maintenance, in the total lease rate. This means you will pay one lump sum for rent, from which the landlord pays his expenses. On the gross lease, the landlord pays all or most expenses associated with the property. This includes taxes, insurance, and common area maintenance out of the rents received from tenants and could also include the utilities and janitorial services. You are responsible for paying your own property insurance và taxes on a gross lease.So which type of lease agreement is most beneficial khổng lồ you, the tenant? Well this is up khổng lồ the individual, & there are pluses khổng lồ both.An NNN lease allows you lớn make changes on your own usage which will save you money on the amount you’re charged, for example on your utilities. Usually the monthly rent on an NNN lease is lower than a gross lease, but with an NNN lease you has a higher level of responsibility for the building itself.Gross rate lease can beneficial to lớn as well because it’s much easier lớn budget your expenses for the year without worrying about unexpected building expenses. For example, this winter, the cost of snow removal is going to be much higher than in previous years and would not be passed on lớn you. The landlord assumes all responsibility for the building & costs associated with it, allowing you to concentrate on growing your business.The most important rule of commercial leases is for tenants to lớn read their leases carefully và clarify with the landlord exactly what expenses they are responsible for. At the over of the day, it’s a matter of what you’re comfortable with – making a mix monthly payment or paying only for what you use.
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Check out the information clip below where Craig và Jason giới thiệu some helpful information on the NNN lease.