A triple net lease, also referred to as a “triple N” or “NNN”, refers to a commercial lease agreement where the tenant is responsible for three additional payments in addition to rent: building maintenance, building insurance, and property taxes. In this circumstance, the landlord does not pay real estate taxes, building insurance, or for any common area maintenance expenses, also referred to as “CAM” expenses. Because of this, the rent price is generally much lower for the tenant.

Triple Net Lease vs. Gross Lease

The opposite of a triple net lease is a gross lease. A gross lease is a commercial lease agreement where the landlord pays for all three: building maintenance, property taxes, property insurance. In the case of a gross lease, the landlord can charge a higher rent to the tenant in this situation to help offset these costs incurred by the landlord. It is important to consider whether or not a triple net lease or a gross lease is the better plan for you. For example, if the landlord’s property is in good condition then there may be less anticipated maintenance so the tenant might benefit from lower rent and lower maintenance costs. However, if the property is in need of costly repairs then the landlord might benefit from the costs being incurred by the tenant.

Greenberg & Company

Greenberg & Company is a commercial real estate firm operating in the Houston, Texas area for over 40 years. The Greenberg team is made up of highly skilled and professional real estate agents and real estate brokers who are knowledgeable about the Houston area and in buying, selling, and leasing services. Greenberg’s Property Management Company in Houston also provides commercial real estate management services. Contact us today to discuss the types of lease terms available and what might best suit your circumstances.