Property Management
What is the difference between 'gross lease' and 'triple net lease' from a landlord's perspective?
AA. There is no financial difference between the two lease types
BB. In a gross lease, the landlord pays operating expenses; in a triple net lease, the tenant pays taxes, insurance, and maintenance✓ Correct
CC. Gross leases are for residential; triple net leases are for commercial only
DD. Triple net leases have higher base rents than gross leases
Explanation
In a gross lease, the landlord collects one rent payment and pays all operating expenses (taxes, insurance, maintenance). In a triple net (NNN) lease, the tenant pays base rent plus taxes, insurance, and maintenance. Triple net leases provide more predictable net income for the landlord but lower gross rents.
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