What does a tenant pay in a net lease?

What does a tenant pay in a net lease?

• A. Only a fixed rent
• B. A percentage of the property value
• C. Fixed rent plus property costs
• D. Nothing beyond the initial payment

Answer: (C)

In a net lease, the tenant is responsible for paying a fixed rent amount along with additional property-related costs. These costs typically include expenses such as property taxes, insurance, and maintenance fees. This arrangement differs from a gross lease, where the landlord covers these additional costs. By paying both the fixed rent and property costs, the tenant assumes a portion of the operational expenses associated with the property, which is why option C accurately describes the tenant's financial obligations in a net lease scenario.

In a net lease, the tenant is responsible for paying a fixed rent amount along with additional property-related costs. These costs typically include expenses such as property taxes, insurance, and maintenance fees. This arrangement differs from a gross lease, where the landlord covers these additional costs. By paying both the fixed rent and property costs, the tenant assumes a portion of the operational expenses associated with the property, which is why option C accurately describes the tenant's financial obligations in a net lease scenario.