ContractsIntermediateArizona Exam

In an Arizona commercial lease, a 'gross lease' means:

AThe tenant pays base rent plus operating expenses
BThe landlord pays all property operating expenses and the tenant pays a fixed rent amountCorrect
CThe lease is based on a percentage of the tenant's gross sales
DThe tenant pays utilities only

Why The landlord pays all property operating expenses and the tenant pays a fixed rent amount Is Correct

Answer B: The landlord pays all property operating expenses and the tenant pays a fixed rent amount

In a gross lease, the tenant pays a fixed rent and the landlord pays all operating expenses including taxes, insurance, and maintenance. It simplifies budgeting for the tenant.

Exam Tip: Contracts

Contract questions frequently test the essential elements required for a valid contract. Remember: competent parties, mutual consent, lawful object, and sufficient consideration. Watch for void vs. voidable distinctions.

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