Triple Net Office (NNN) Lease Agreement (OLA)

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A Triple Net Office (NNN) Lease Agreement (OLA) is an OLA agreement where the office tenant is responsible for paying all property taxes (real estate taxes), building insurance expenses, and maintenance expenses (on top of any normal OLA fees).

  • Context:
    • It can indicate that the tenant is responsible for common area maintenance (CAM) fees, such as landscaping and cleaning of shared spaces.
    • It can require the tenant to pay property taxes, including any increases that may occur during the lease term.
    • It can include the tenant's obligation to obtain and maintain insurance coverage for the building.
    • It can specify that the tenant is responsible for repairs and maintenance of the leased space, including structural repairs and maintenance of HVAC systems.
    • ...
  • Example(s):
  • Counter-Example(s):
    • a Double Net Lease (NN): The tenant is responsible for property taxes and building insurance, but not for maintenance and repairs of the building structure and common areas. These are typically the landlord's responsibility.
    • a Single Net Lease (N): The tenant pays property taxes along with the base rent. Building insurance and maintenance costs are typically the landlord's responsibility.
    • a Gross Lease (Full Service Lease): The tenant pays a single, lump sum rent, and the landlord pays for all the property expenses, including taxes, insurance, and maintenance. Utilities and janitorial services may also be included.
    • A Full Service Office Lease Agreement where the landlord covers all property expenses, including taxes, insurance, and maintenance.
    • a Modified Gross Lease: A middle ground between a gross lease and a net lease. The tenant and landlord negotiate which expenses each party will cover. This can vary significantly depending on the agreement.
    • a Percentage Lease: Common in retail, especially in malls. The tenant pays a base rent plus a percentage of their revenue. The landlord may cover most property expenses.
  • See: Office Lease Agreement Article, Office Lease Agreement Clause, Office Lease Agreement Provision.


References

2023