A Triple Net Lease (“NNN”) is one where the Landlord receives the same net amount of rent each month, no matter what the expenses are. NNN’s are typically commercial real estate leases. Residential leases, on the other hand, are typically gross leases which cover all expenses. 

In a NNN lease, the tenants, in addition to paying fixed rent, so much per square foot, also pay their pro rata share of operating expenses on the property. Such expenses include real estate taxes (N), insurance (N), and Common Area Maintenance (N) or “CAM”. CAM usually includes landscaping, snow removal, repairs to the mechanical systems, and a management fee. Consequently, despite the fixed base rent aspect of the lease, the tenants overall rent will fluctuate each year.

There are many important nuances to these types of leases. It’s very tricky stuff. Proper drafting can save a client a considerable amount of money. Whether you are a landlord or tenant, we can help you cap your exposure when negotiating a contract that you
will be paying on for a long time.