Property Management
A percentage lease in retail commercial real estate typically includes:
AOnly a percentage of gross sales with no base rent
BA base rent plus a percentage of the tenant's gross sales above a specified breakpoint✓ Correct
CRent that adjusts based on the percentage change in the CPI
DA percentage of the landlord's expenses passed through to the tenant
Explanation
Percentage leases (common in shopping centers) consist of a minimum base rent plus an overage—a percentage of gross sales above a specified natural breakpoint. This aligns landlord and tenant interests: landlords benefit when tenants succeed.
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