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Lease glossary

Gross lease

A gross lease is a lease in which the tenant pays one fixed rent and the landlord pays the property’s operating costs, such as taxes, insurance and maintenance, out of it. Most apartment and house leases are gross leases, sometimes with utilities billed separately.

Also called full-service lease

Example

An office tenant pays $3,000 a month under a full-service gross lease, and the landlord covers taxes, insurance, cleaning and utilities. If the building’s taxes rise $6,000 next year, the landlord absorbs it, unless the lease is a modified gross lease that passes increases over a base year on to the tenant.

In a lease it looks like…

Tenant shall pay monthly rent of $3,000, which includes Tenant’s share of real estate taxes, insurance and common area maintenance. Landlord shall pay all operating expenses of the building except utilities separately metered to the premises.

Good to know

Because the landlord carries the cost risk, gross rents are usually quoted higher than net rents for the same space. When comparing offers, compare the total yearly cost, not the rent line, and check which utilities the rent includes.

Plain English, not legal advice. Last reviewed September 29, 2026.