Example
A retail tenant leases 2,000 square feet at $24 per square foot a year, $48,000 in base rent. The building’s taxes, insurance and common-area maintenance add $8 per square foot, so the tenant’s total cost is $64,000 a year, about $5,333 a month. If the property taxes rise, the tenant pays the increase, not the landlord.
In a lease it looks like…
In addition to Base Rent, Tenant shall pay its pro rata share of Real Estate Taxes, Insurance Premiums and Common Area Maintenance costs, estimated at $8.00 per square foot per year, payable monthly and reconciled annually.
Good to know
Net leases come as single, double and triple, depending on how many of the three costs pass to the tenant, and the labels are used loosely, so the lease’s expense clause is what counts. Home rentals are almost never triple net.
Plain English, not legal advice. Last reviewed September 29, 2026.