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What is Triple Net in a Lease

What is Triple Net in a Lease

When buying a business with real estate attached, you may want to know the terms.
The most important terms are whether it’s a sale or lease.
Assuming it’s a lease, you want to know price and length, but other terms are quite important to such as restrictions, covenants, easements, etc. that can affect the lease.
Triple net is a term you hear.
Triple net means the tenant pays all the expenses associated with the property including insurance, taxes, and maintenance.
This may include deductibles and upkeep.
The rents on a triple net are typically higher.
A single net lease requires tenants to pay property taxes in addition to rent, and a double net lease typically tacks on property insurance.
If you are considering purchasing a commercial property as a landlord then you probably prefer triple net, because it means the costs are passed on and there’s less risk. Quite naturally, the rents are higher so this will affect demand.
If you are a tenant, triple net means everything is included in the price per month and means your costs may be higher for the monthly. You also might have to pay other expenses for deductibles and maintenance.
There are pros and cons of this when considering it from the landlord and tenant perspective. In the unlikely event of default, you might want to consult with an attorney who can walk you through the practical concepts besides what is in the lease.

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