Property Management

An Oklahoma commercial property manager negotiates a retail lease with a percentage rent clause. Under a percentage rent clause:

AThe tenant pays a percentage of the landlord's income as rent
BThe tenant pays a base rent plus a percentage of their gross sales above a breakpoint, tying rent to business performance✓ Correct
CRent is reduced by the tenant's operating expenses
DThe tenant pays only a percentage of market rent

Explanation

Percentage rent clauses in retail leases require tenants to pay base rent plus a percentage of gross sales exceeding a natural breakpoint (base rent ÷ percentage rate). This aligns the landlord's income with the tenant's retail performance.

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