Net Lease Agreements
Modified Gross Rents – Commercial tenancy agreement in which the tenant bears part of the property-related costs. In this tenancy agreement, the tenant pays the basic rent plus a share of the property tax (i.e. part of the total bill based on the tenant`s share of the space rented); The owner pays for all other construction costs. The tenant also pays for benefits and services. From the tenant`s point of view, the net tenancy generally offers a lower rental price than a comparable gross rental agreement. This also applies if you take into account taxes and other additional expenses — because the tenant accepts a higher level of risk, the trade-off is that the lessor accepts a little less income in exchange for consistency. Net leasing is the most common for commercial real estate occupied by a single tenant, although it is not unheard of in situations where there are few tenants in a building. Warehouses, independent retail buildings, entertainment venues and medical buildings are examples of types of real estate that typically use net leasing. A triple net rental agreement (Triple-Net or NNN) is a rental agreement for a property by which the tenant or the taker agrees to pay all property taxes, real estate insurance and maintenance payments (the three „networks“) on the property in addition to the normal costs to be provided under the agreement (rent, incidental costs etc.). In the case of such a tenancy agreement, the tenant or tenant is responsible for all costs related to the repair and maintenance of a common space (also known as CAM – Common Area Maintenance). CAM fees are usually negotiated in advance in the form of a dollar-set amount per square metre. Like net individual rentals, homeowners should have given them the additional payments so that they can pay them to the municipality and the insurance.
Even if the tenant`s tenancy agreement includes these payments, the landlord`s name appears on the tax and insurance bill, which means that he is ultimately responsible for it. By charging these fees directly from the tenant, the landlord can avoid problems related to late or missed payments from tenants, which could result in additional costs. If an agent participated in the rental we developed, they must also present items in the „Agent Signature“ and „Print Name“ lines in the final signing area.