A triple net commercial lease agreement is an official document that is used for letting out commercial real estate. It details the rights and responsibilities of the landlord and the tenant alike. Under this lease agreement, the tenant or lessee pays all the expenses that pertain to the property.
The real estate taxes, maintenance, and building insurance are examples of these. These expenses are independent of the standard expenses which any tenant ordinary incurs. Some of these are utility expenses, monthly rent, and regular inspections.
Triple Net Lease vs. Other Leases
It goes without saying that the triple net lease is not the only one that is in existence at the moment. Indeed, there are several kinds of leases that may also deliver more or less similar degrees of satisfaction. We devote this segment to the comparison between this lease and some of the other lease agreements in place.
Triple Net Lease vs. Single Net Lease
Under the single net lease, the tenant assumes the responsibility of remitting property taxes over and above the rental payment. Other than that, all the liabilities and expenses are borne by the landlord. It is somehow cheaper to come by than the triple net lease.
Triple Net Lease vs. Double Net Lease
The double net lease entails the incurrence of the property taxes and insurance premiums by the tenant, hence the designation, double lease. For this reason, it is more expensive than the single net lease yet still more affordable than the triple net lease.
Triple Net Lease vs. Bondable Lease
A bondable lease is more comprehensive than the triple net lease. Under this contract, the tenant incurs every other expense that is associated with the real estate property as well as those that have to be incurred when rebuilding the same after a causality. This is a very expensive contract to get into.
Triple Net Lease vs. Ground Lease
The ground lease is a kind of an agreement which permits the tenant to develop some piece of property on the land on which the rental facility stands. Upon the expiry of the lease agreement, this piece of property is passed on to the property owner. Thus, it is more liberal than the standard triple net lease agreement.
Triple Net Lease vs. Gross Lease
A gross lease is perhaps the cheapest and the most common kind of lease in existence today. Under this scheme, the tenant pays a flat rental amount each period. It is the landlord who incurs all expenses involved in the process like utilities, water, taxes, and premiums. Many prefer it because it is also less restrictive than other kinds of lease agreements.
Triple Net Lease vs. Percentage Lease
Lastly comes the percentage lease. This one requires the tenant to pay a base rent and a small percentage of any revenue which arises in the course of utilizing the rental premise. Many business properties adopt this kind of approach as it is the most lucrative of all the agreements.
Pros and Cons of (NNN) Lease Agreement
- Spares the property owner from the hassles which the management of the said pieces of property entail.
- The actual rental payment to the tenant is lower than that of other leases.
- Longer-than-average lease terms on the part of the tenant.
- Good and reliable for businesses as the terms favor long-term property development.
- Comprehensive and easier to undertake when compared to the other forms of leases.
- The property owner has to cede some controls to the tenant
- Suffers severe inconveniences in case the tenant absconds his duties and responsibilities
- Quite tedious and inconveniencing for a lazy or busy tenant to undertake
How to write?
There is no better way to draft a good triple net commercial lease agreement than to make use of a template for the same. This is a document that gives step-by-step guidance on how to fill the form, draft the agreement and fulfill the required conditions.
It is great in the sense that it does provide the insight needed to do a good job. You have it for your taking if you are a newbie who has never drafted such a letter before. Moreover, the wizard also simplifies some of the difficult terms and concepts which you have to master before drafting the letter.