What is a common characteristic of net leases in commercial real estate?

In commercial real estate, net leases are characterized by the tenant taking on some, or potentially all, of the operating expenses associated with the property in addition to their base rent. This may include costs such as property taxes, insurance, and maintenance. The common types of net leases include single, double, and triple net leases, which denote different levels of expense responsibility.

The arrangement benefits landlords by reducing their financial responsibilities and giving tenants control over certain aspects of the property, such as maintenance and repairs, potentially leading to better property management. This structure is a significant departure from gross leases, where the landlord is responsible for all expenses associated with the property. Understanding this key trait of net leases is crucial for tenants and landlords in managing financial obligations and expectations within commercial real estate agreements.