When starting or expanding a business, one of the most important decisions to make is choosing the right commercial lease. A commercial lease is a legal agreement between a landlord and a tenant, outlining the terms and conditions of renting a commercial property. There are several types of commercial leases available, and each has its own advantages and disadvantages:
A gross lease is also known as a full-service lease. It is a type of commercial lease in which the landlord covers all the operating expenses, such as utilities, maintenance, and property taxes. In this type of lease, the tenant pays a fixed amount of rent each month, and the landlord takes care of all the expenses related to the property. This type of lease is most commonly used in office buildings, where the landlord provides various services like security, janitorial, and maintenance.
In a net lease, the tenant is responsible for paying some or all of the operating expenses in addition to the base rent. There are three types of net leases: single, double, and triple net leases. In a single net lease, the tenant pays the base rent plus property taxes. In a double net lease, the tenant pays the base rent plus property taxes and insurance. In a triple net lease, the tenant pays the base rent plus property taxes, insurance, and maintenance.
In a percentage lease, the tenant pays a percentage of their sales in addition to the base rent. This type of lease is most commonly used in retail spaces, where the landlord shares in the tenant’s profits. The percentage rate is usually negotiated before signing the lease agreement.
Modified Gross Lease
A modified gross lease is a hybrid of a gross lease and a net lease. In this type of lease, the tenant pays a base rent that includes some of the operating expenses, and the landlord covers the rest. The tenant may be responsible for some additional expenses, such as utilities or janitorial services.
In a ground lease, the tenant leases the land from the landlord and is responsible for constructing the building. The landlord retains ownership of the land and typically charges a lower rent than in other types of leases. This type of lease is commonly used for long-term leases of 50 years or more.
Choosing the right type of commercial lease can have a significant impact on your business’s success. RealDealDocs enables you to read through a variety of commercial leases which have already been successfully implemented.
Here are several commercial leases currently available in the RealDealDocs database:
Industrial Space Lease (Gross) for VIASYSTEMS GROUP INC, Viasystems Corporation
Triple Net Lease Agreement for KONA GOLD SOLUTIONS, INC., 3090 S Hwy 14, LLC, Goldleaf Distribution, LLC
Standard Lease (Multiple Tenant – Tenant Pays Its Percentage Share Of Operating Expenses, Real Property Taxes And Insurance Costs – No Base Year)
Ground Lease for CUBIC CORP /DE/, Bankers Commercial Corporation, Cubic Corporation