Triple Net Lease

A Triple Net (NNN) lease is a commercial lease structure in which the tenant is responsible for paying base rent plus the three major operating expenses: property taxes, building insurance, and maintenance costs. This arrangement shifts most of the property’s operating risk and expense variability from the landlord to the tenant.

NNN leases are commonly used in retail, industrial, and single-tenant commercial properties. They are favored by investors for their predictable, passive income stream and minimal management responsibilities. The trade-off is that base rents in NNN leases are typically lower than in gross leases, where the landlord covers operating expenses.