Property Management
A Virginia retail tenant whose lease includes a 'percentage rent clause' pays:
AA fixed rent regardless of sales
BA percentage of gross sales above a specified breakpoint, in addition to base rent✓ Correct
COnly a percentage of net profits
DNo rent until profitable
Explanation
A percentage rent clause requires a retail tenant to pay a base rent plus a percentage of gross sales above a 'natural breakpoint' (typically base rent ÷ percentage rate). It aligns landlord and tenant interests.
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Key Terms to Know
Earnest Money
A deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
Purchase AgreementA legally binding contract between a buyer and seller that outlines the terms and conditions of a real estate sale.
Option ContractA contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.
Math Concepts
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